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    Producers Want Ethanol in Iowa's Gasoline

    Governor backs an E10 mandate for the state

    DES MOINES -- Ethanol producers in Iowa plan to ask the state legislature to pass a bill requiring all gasoline sold to contain at least 10 percent ethanol, according to a report in the Des Moines Register.

    Thirty-one states use a higher percentage of ethanol than Iowa, despite Iowa being the largest ethanol producer in the country. Motorists are able to buy non-ethanol-blended gasoline at most retail stations.

    Gov. Chet Culver called an E10 mandate is a "step in the right direction." However, opponents are ready to fight the proposal, according to the report.

    "If an ethanol mandate is imposed in Iowa, it will cause gas prices to rise," said Dawn Carlson, president of the 1,500-member Petroleum Marketers and Convenience Stores of Iowa. Critics maintain states with mandates, such as Minnesota, have higher fuel prices.

    State Sen. Jack Kibbie will back a bill requiring 10-percent ethanol blends for highway use.

    "People in Iowa like ethanol, they just don't like to be told what to do," Kibbie told the newspaper. "People need to understand that without ethanol, corn and farmland would be worth about half as much as they are today."

    Monte Shaw, executive vice president of the Iowa Renewable Fuels Association, said the percentage of fuel sold in Iowa blended with ethanol is less than 75 percent, while the percentage of ethanol-blended gasoline now averages 80 percent in the rest of the nation. "Iowa is lagging behind the rest of the country in ethanol use," Shaw said at the Iowa Renewable Fuels Association annual meeting, the newspaper reported.

    Carlson disputed that, saying "figures from the Iowa Department of Revenue show that ethanol usage is really more than 80 percent."

    Approximately 100 million gallons of ethanol are sold in Iowa. That would increase to about 140 million gallons if a state mandate passed, Shaw told the newspaper.

    Iowa is the nation's largest producer of ethanol, with about 3.2 billion gallons produced at 39 ethanol production plants in 2009. Most of the ethanol produced in Iowa is sent out of state.

    Twelve states have passed mandates in varying forms, ranging from tax credits to blend percentages of 2 percent to10 percent, the current limit under federal regulations, or percentages of total use in the state, the newspaper reported.

    In 2009, the Iowa Senate approved a bill requiring all diesel fuel sold in the state to contain 5 percent biodiesel, made primarily from soybean oil. The bill did not make it to the House floor for debate.

    The ethanol industry is waiting for a decision from the Environmental Protection Agency to increase the blend of ethanol in unleaded gasoline from 10 percent to 15 percent. An increase could add another 7 billion gallons to the annual demand for ethanol, the newspaper reported.

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