http://www.biodieselmagazine.com/articles/319210/iowa-road-funding-bill-passes-with-reduced-tax-rate-for-b11
Iowa road funding bill passes with reduced tax rate for B11
By The Iowa Renewable Fuels Association | February 24, 2015
The Iowa Legislature created a 3-cent per gallon differential tax rate
for B11 and higher biodiesel blends in the road funding legislation
passed Feb. 24. This provision is expected to boost the availability and
sales of cleaner-burning, locally produced biodiesel. The bill was
passed today by a vote of 28 to 21 in the Iowa Senate, and a vote of 53
to 46 in the Iowa House. It now heads to the governor’s desk to be
signed into law.
Under the legislation, diesel fuel will be taxed at a rate of 32.5 cents
per gallon. However, if diesel fuel is blended with 11 percent or more
of biodiesel, the state excise tax is reduced to only 29.5 cents per
gallon. The 3-cent per gallon differential for B11 and higher blends
will go into effect on July 1, 2015.
“The biodiesel community thanks the Iowa Legislature for its commitment
to increasing the use and availability of higher biodiesel blends,”
stated Iowa Renewable Fuels Association Policy Director Grant Menke.
“The 3-cent differential for blends containing at least 11 percent
biodiesel will be a useful tool to build upon the progress we’ve made in
cleaning up our air and supporting our economy through the use of
homegrown Iowa biodiesel. The B11 differential further demonstrates
Iowa’s policy leadership in expanding market access and consumer choice
for renewable fuels.”
“With no end in sight on the federal policy uncertainty for biodiesel, I
am grateful the Iowa Legislature took this opportunity to drive sales of
higher biodiesel blends,” stated IRFA Vice President and Western Dubuque
Biodiesel General Manager Tom Brooks. “This 3-cent differential for B11
and higher blends represents another step forward for the economic,
environmental and energy security benefits that come along with a strong
Iowa biodiesel community.”
Biodiesel is made from a wide range of feedstocks, including soybean
oil, animal fats, distillers corn oil, and used cooking oil. Iowa
produced 227 million gallons of biodiesel in 2014, roughly 16 percent of
U.S. biodiesel production for the year. According to the EPA, biodiesel
reduces greenhouse gas emissions by 57 percent to 86 percent compared
with petroleum diesel.
Iowa is the nation’s leader in renewable fuels production. Iowa has 12
biodiesel facilities with the capacity to produce nearly 315 million
gallons annually. In addition, Iowa has 43 ethanol refineries capable of
producing more than 3.8 billion gallons annually, including 22 million
gallons of annual cellulosic ethanol production capacity and one
cellulosic ethanol facility currently under construction.
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