Iowa renewable fuels usage stalled at 7.5 percent; E85 only 0.1 percent of fuel sales from 100 pumps in half the state’s counties

In Iowa, lawmakers expressed disappointment that, two years after landmark legislation was passed in support of E85 conversion, E85 represents only 0.1 percent of Iowa fuel sales. 7.5 percent of Iowa fuel comes from renewable sources, about the same as two years ago when Gov. Vilsak signed a measure allocating $13.6 million to E85 conversion, and mandating that 25 percent of the state’s fuel usage come from renewable sources by 2020.

Lawmakers noted that E85 is available in half of Iowa’s counties, with only 100 pumps statewide, and that only 12 percent of new cars sold in Iowa last year are flex-fuel ready, mostly pickups and SUVs.

The Iowa state Renewable Fuels Association said that E85 sales increased 48 percent in the 3rd quarter of 2007, compared to the corresponding quarter in 2006. Total sales for the quarter were 941,547 gallons from 68 E85 stations. The figures, which represent 15 gallons per day per station, continue to underline a lack of appeal of E85 among drivers, although Iowa’s station owners increased E85 availability in the fourth quarter to 79 stations.

Even in Iowa, E85 is tough to find, and the general manager of the East Central Iowa Cooperative said “I don’t think flex-fuel even passes through someone’s head when they are buying a vehicle around here”. The sales manager of a Waterloo, IA Chevrolet dealership said that rising flex-fuel vehicle numbers are “mostly a coincidence”.

In Pennsylvania, fuel marketer Sheetz recorded a 50% drop in sales at pumps converted from gasoline to E85. Sheetz spent more than $150,000 last year on E85 conversion at three locations in Western Pennsylvania.

Part of the problem is a poor cost-benefit performance. A new cost-benefit analysis by researcher John Graham at the Pardee Rand Graduate School found that E85 scored the worst among all fuel options. Diesels performed the best, saving $2300 over a vehicle’s lifetime compared to regular gasoline. Hybrids were a close second, while E85 cost $1600 for fuel over vehicle lifespan. The study’s authors did not disclose the mileage standards used in the study, or the vehicles studied.

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