A coalition of retailers, producers, equipment manufacturers have formed the Coalition for E85 with the stated purpose of protecting consumer access to 85% ethanol blends.
According to the coalition, if the current tax credit for ethanol expires at the end of the year and is not renewed, Flex Fuel vehicle (FFV) drivers could end up paying up to 38 cents more per gallon for E85. This increase they say will force many small businesses that have invested more than $100 million in E85 infrastructure to close their pumps.
“E85 is not only an alternative fuel, it is our nation’s most widely adopted alternative fuel,” said Matt Horton, CEO of Propel Fuels, one of the lead members of the Coalition for E85. “If we are to make a meaningful dent in our dependency on foreign oil, we must expand E85 infrastructure and ensure this fuel has fair tax treatment.”
The coalition wants the Internal Revenue Service to recognize that E85, is not an additive, but a true alternative fuel like natural gas or propane. They note that E85 also provides a platform for advanced biofuels and can be made from non-food sources such as farming byproducts, algae biomass and household waste. Currently other alternative fuels such as compressed natural gas, propane and hydrogen receive a $0.50 per gallon tax credit as part of the Alternative Fuel Credit. The Coalition believes E85 should be included in this group.
Coalition member Todd Garner, CEO of Protec Fuels, says if the current tax credit for ethanol goes away permanently, the impacts on the price and availability of E85 will be dramatic. “We must not abandon E85 this close to self-sustainability,” he said. “We hope retailers, producers, auto makers, and others concerned about the future of E85 will stand up and fight with us.”
The Coalition for E85 currently includes Propel Fuels, Protec, Clean Fuels Development Coalition, ethanol industry associations, pump and tank companies, and individual E85 retailers.