Growth Energy Voices Support for Ohio Tax Credit for Higher Biofuel Blends

(Growth Energy/Ethanol Producer Magazine) Growth Energy, the nation's largest biofuels trade association, submitted testimony today to the Ohio House of Representatives and its Ways and Means Committee voicing support for House Bill 324, which would provide a tax credit to incentivize fuel retailers to sell more bioethanol blends like E15 (made with 15 percent bioethanol) and E85 (made with 51-85 percent bioethanol).

"This credit is important as retailers in Ohio continue to build out the market and invest in additional infrastructure to install these ethanol blends," said Growth Energy in its written testimony. "Ethanol blends such as E15 and E85 provide environmental benefits, boost Ohio's farmers and biofuel producers, and give consumers more affordable choices at the pump."

E15, sometimes branded Unleaded 88 (UNL88), is a fuel made of gasoline and 15% bioethanol. It’s approved for all cars model year 2001 and newer, which represents more than 95% of the vehicle miles traveled on the road today and more than nine out of 10 cars on the road. To date, consumers have now driven more than 90 billion miles on E15, and retailers have conducted millions of transactions with this fuel. Ohio currently has 144 retail locations selling E15, and 256 locations selling E85. The state is also home to seven biorefineries--five of which are Growth Energy members.

Read Growth Energy's full testimony here and learn more about the bill here. READ MORE

Excerpt from Daily Reporter: The legislative effort to promote the sale of high- ethanol fuel statewide has been resurrected by a pair of Republican lawmakers in the Ohio House of Representatives.

Reps. Riordan McClain and Roy Klopfenstein recently introduced a bill to authorize a nonrefundable tax credit to gas stations for the sale of high-ethanol gasoline.

“Despite the fact that Ohio is one of the nation’s largest ethanol producers, there are very few pumps dispensing E15 in the state,” McClain said of the fuel, which is marketed to consumers as Unleaded 88. “Despite being in the top few of both corn and ethanol production, we lag in the lower half of consumer availability for E15. … In my hometown of Upper Sandusky, where you can’t drive two miles without seeing corn growing in the summer, we have one station that offers E15.”

He said by comparison, Pennsylvania has four times as many E15 fueling locations with roughly the same population as the Buckeye State.

“Less than 2 percent of gas stations nationwide offer E15,” however, McClain added.

A co-owner of a Henry County gas station, American Freedom Energy, told members of the Ways and Means Committee that his business’ decision to sell high-blend ethanol had to be negotiated when the company began selling fuel under a brand.

“A condition of our agreement was that we remove our E15 and higher ethanol blends,” Glenn Badenhop said. “As true believers that ethanol and alternative fuels were American Freedom Energy’s future, and having seen firsthand how important these fuels are to our rural economy and the economy of the entire state of Ohio, we were not willing to give up our option of consumer choice.”

He said both parties ultimately settled on an agreement that benefitted consumers as well as both businesses.

Klopfenstein explained that the fuel is on average three to 10 cents cheaper per gallon than traditional fuel and is a viable option for nine out of 10 cars.

“Unfortunately, most of the fuel produced in Ohio is exported to other states, as only 60 stations in Ohio offer it compared to more than 2,300 stations nationwide that offer this fuel,” the Haviland lawmaker said. “It is our hope by offering this temporary tax credit that this legislation will expand the availability of bioethanol to Ohioans by incentivizing the fuel industry to add this cost saving option across the state.”

House Bill 324 would authorize the nonrefundable income tax and commercial activity tax credit for the retail sale of the fuel for a five-year period or once awarded tax credits total $10 million — whichever occurs first.

McClain said he didn’t want detractors to confuse the measure as a government subsidy manipulating the free market.

“This legislation moves us in the direction of a free market where consumers have access to this product,” he said. “E15 is not a new product, but since its entry into the market, its availability has been suppressed.”

The federal government approved E15 gasoline, which contains 15 percent ethanol, in 2011, and the U.S. Environmental Protection Agency has approved the fuel for use in all cars, trucks and SUVS made in 2001 or later, testimony provided. READ MORE