The Iowa Legislature on May 2 voted to secure another year of funding for the Iowa Renewable Fuels Infrastructure Program — a move that will spur economic activity across the state and support Iowa farmers.  

RFIP provides cost-share dollars to fuel retailers to install blender pumps and other equipment necessary to offer higher blends of ethanol and biodiesel. The Legislature passed Senate File 2414, which includes $3 million of funding for RFIP out of the Rebuild Iowa Infrastructure Fund for fiscal year 2019. The bill now goes to Gov. Kim Reynolds for her consideration. She is expected to sign it into law.

“RFIP is doing exactly what it was designed to do: Give Iowans a great return on their investment while expanding consumer choice at the pump for higher biofuel blends,” says Grant Menke, policy director for the Iowa Renewable Fuels Association. “Interest in the program remains at an all-time high, and this action by the Iowa Legislature will help continue this momentum.”

Program ran out of money
Since RFIP’s inception, every dollar of state funding for the program has resulted in $4 of private economic investment — totaling more than $138 million in private economic activity. During its third quarterly meeting of fiscal year 2018, the RFIP board awarded the remainder of all program funds to 15 projects. Some retailers were turned down for the first time in the program’s history due to the funds being exhausted.

“IRFA thanks the Iowa Legislature for its strong, bipartisan support of the RFIP,” Menke says. “We especially thank Rep. Dan Huseman and Sen. Craig Johnson — the chairs of the Transportation, Infrastructure and Capitals Appropriations Subcommittee — for prioritizing funding for the RFIP in the Rebuild Iowa Infrastructure Fund budget.”

RFIP offers cost-share grants to Iowa retailers wishing to upgrade their fueling infrastructure (pumps, tanks, etc.) to offer E15, E85 and/or biodiesel blends. Reimbursement can be up to 70% of the installation costs, up to a maximum of $50,000 per project, with a five-year commitment to sell E15, E85 or biodiesel blends. The RFIP cost-share program is managed by the Iowa Department of Agriculture and Land Stewardship. Learn more about the program online at iowaagriculture.gov/agMarketing/IRFIP.asp.

Iowa Biodiesel Board praises Legislature
The cost-share grants also help fuel distributors and retailers modernize their equipment to include fuels like biodiesel. Grant Kimberley, executive director of the Iowa Biodiesel Board, adds: “We commend the Legislature for prioritizing this IRFIP, recognizing the many benefits the program has delivered in Iowa. The program has proven itself a legislative success story, helping to increase availability of renewable fuels for Iowa consumers, driving economic growth and supporting the ag economy.”

The Iowa Department of Revenue reports that in 2017, for the second year in a row, more than half of diesel gallons sold in the state contained biodiesel. This growth is promising and shows the program’s positive effect on the fuel supply, Kimberley says, helping Iowa maintain its role as the top biodiesel-producing state in the nation. Since the program began in 2006, just over $30 million in state funding and a $5 million federal investment has helped spur an estimated $138.8 million in private investment. “That’s an incredible return on investment of about 4-to-1 for Iowa taxpayers,” he notes.

Strong commitment helps Iowa economy
“We’re proud of Iowa’s leadership position in progressive state biodiesel and renewable fuel policies, and thank the Legislature and Gov. Kim Reynolds for their strong commitment to this industry,” Kimberley says.

In 2017, Iowa’s biodiesel plants produced about 285 million gallons. A study by ABF Economics shows biodiesel activity in Iowa generated about 3,800 full-time equivalent jobs and contributed $278 million in household income that year. The Iowa Biodiesel Board is a state trade association representing the biodiesel industry. 

Iowa is the nation’s leader in renewable fuels production, with 43 ethanol refineries capable of producing nearly 4.4 billion gallons annually, including about 55 million gallons of annual cellulosic ethanol production capacity, and 12 biodiesel facilities with capacity to produce 400 million gallons annually. For more information, visit iowarfa.org.