Report shows 70% of Iowa’s on-road diesel fuel contains biodiesel

In Iowa, a report released by the Iowa Department of Revenue shows biodiesel-blended fuel represented 69.9 percent of the total reported sales of on-road diesel last year in Iowa. Furthermore, blends of 11 – 20 percent biodiesel (B11 – B20) made up most of those sales.

Iowa fuel retailers reported selling 636.9 million gallons of taxable diesel fuel in the 2019 Retailers Fuel Gallons Annual Report. Of that, blends of one-to-ten-percent biodiesel (B1-B10) equaled 76.5 million gallons. Blends of B11-B19 sold equaled 291.2 million gallons, and B20 or higher blend diesel sold equaled 77.4 million gallons.

Combined, blends of B11 or higher made up 57.8 percent of total on-road diesel sales in 2019. That’s up from 47.4 percent in 2018.

Sales of off-road gallons of biodiesel blends also rose in 2019, according to the report. About 200.7 million gallons of dyed (non-taxed) diesel fuel were sold, including 49.9 million biodiesel-blended gallons (about 25 percent). The agriculture and construction industries are the biggest users of off-road fuel.

When combining on-and-off-road fuel sales, biodiesel-blended gallons accounted for 59.1 percent of diesel gallons sold by reporting retailers.

Iowa Biodiesel Board leaders pointed to the state’s strong policies as key to the successful increase in biodiesel usage statewide.

“These milestones at the retail level show that Iowa’s progressive biofuels policies are working as intended to increase production and consumption of biodiesel,” said Grant Kimberley, IBB executive director.

Those policies include a Fuel Tax Differential, which amounts to a 3-cent per gallon reduction in the cost of fuel tax for blends of B11 or higher. However, the successful provision will sunset this summer without legislative action, Kimberley noted.

Before the legislature broke due to the coronavirus outbreak, bills that would extend the sunset to June 2026 were eligible for debate on the floor of both the House and Senate.

“Our members are urging their legislators to prioritize this legislation when we get through the coronavirus crisis and the session resumes,” Kimberley said. “We believe the fuel tax differential is vital to maintaining Iowa retailers’ competitiveness against other surrounding states that provide biofuel incentives.”

Additionally, Governor Kim Reynolds has requested $5 million annually for biodiesel and ethanol infrastructure, a request supported by IBB, Kimberley said. The Iowa Renewable Fuels Infrastructure Program helps upgrade petroleum equipment to grow renewable fuel availability in Iowa.