Iowa’s biofuel industry had another record breaking year for production of both ethanol and biodiesel. In 2016, 43 ethanol plants produced 4.1 billion gallons, a slight increase from 2015 of 4 billion gallons. The most significant driver of demand was the Renewable Fuel Standard (RFS).
“Setting another annual ethanol production record is a testament to the efficiency and hard work of Iowa’s ethanol plants,” said Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw. “However, Iowa has the resources, both in corn and plant capabilities, to do much more. In order to unlock this wealth of untapped potential, we need to move beyond E10 and ensure that all consumers have access to higher blends of ethanol at the pump, like E15. The federal government needs to break down regulatory barriers to higher blends that serve no purpose other than to protect petroleum.”
On the biodiesel front, production also hit a record with 297 million gallons, an increase from 242 million gallons in 2015. According to IRFA, the increase was a result of policy certainty at the federal level in the form of the RFS, as well as the biodiesel tax incentive. Other drivers of demand for biodiesel were state policies specific to higher biodiesel blends including Iowa’s B11 excise tax differential.
“This record-busting year speaks volumes of the hard work and strength of Iowa’s biodiesel producers,” said Shaw. “Iowa is home to some of the most efficient biodiesel plants in the world and they took advantage of strong demand in 2016. As we turn the calendar forward to 2017, we unfortunately turn back to the policy uncertainty of prior years. The federal biodiesel tax credit expires on December 31st, and we don’t know for sure whether or when it will be reinstated in 2017. Regardless of the pending challenges of 2017, Iowa plants are well-positioned to remain number one in biodiesel production.”
Shaw added that for 2017 the organization’s top policy priority is securing funding for the Iowa Renewable Fuels Infrastructure Program to enable more retails to install the proper equipment to offer higher blends of ethanol and biodiesel.