Iowa Renewable Fuels Association (IRFA) members are urging state lawmakers to reauthorize biofuel tax differentials before the end of this legislative session.

House File 2279 and Senate File 2403 would extend and modernize fuel tax differentials for E15 and higher ethanol blends and B11 and higher biodiesel blends, which are set to expire on June 30, 2020. With the passage of either bill, Iowa will not only continue to support renewable fuels but put millions of dollars back into the Road Use Tax Fund each year for vital infrastructure projects.

“If the legislature allows the biofuel tax differentials to expire, not only will it raise prices on consumers at the pump, it will also hurt Iowa’s farmers and biofuels producers who are suffering as a result of the COVID-19 pandemic and trade disputes,” said IRFA Policy Director Nathan Hohnstein. “Since the implementation of the current tax differential, we’ve seen biofuel blend sales increase dramatically, but with June 30th just around the corner, it is imperative the legislature take action now. Iowa cannot afford to take a step backward in promoting the use of renewable fuels.”

The tax differentials have helped E10 and B11 and higher biodiesel blends in Iowa go from niche fuels to making up 86% and 57% of sales in 2019 respectively. Because of this success, the new fuel tax differential modernizes the ethanol side of the policy by applying it to E15 and higher blends, making millions of dollars available for road and bridge repairs.