Feds grant $99.6M to improve access to higher ethanol blends

Kwik Trip will receive nearly $10 million in federal grants to improve access for drivers to higher blends of ethanol and to make other biofuel improvements at its gas stations in four Midwestern states including Iowa, U.S. Agriculture Secretary Tom Vilsack announced Friday as part of an effort funding 160 “clean energy” projects in 26 states.

One of those projects also includes Casey’s, which will receive over $3.5 million to make improvements at 194 stations in Iowa — 14 of them in Cedar Rapids and three in Iowa City — to install pumps for E15 and E85 fuel. The grant is in addition to $5 million Casey’s received earlier this year under the program to install 456 E15 dispensers at 111 stations in Iowa, Illinois, Minnesota, Nebraska and South Dakota.

The tranche of grants announced Friday — $99.6 million in total — is the latest in a string of federal assistance for improving nationwide access to E15 and E85 ethanol blends and B20 diesel, which blends petroleum diesel with a biofuel.

Funding for these grants came under the Inflation Reduction Act, which so far has provided $600 million to over 4,500 clean energy projects and more than $180 million for over 200 projects that increase availability of biofuels nationwide, according to the U.S. Department of Agriculture.

The most common blend of ethanol dispensed now is E10, or about a 10 percent blend. E15 offers a higher blend — 15 percent — but is less available to consumers and generally has been blocked from summer sales in many states over concerns about pollution. However, the U.S. Environmental Protection Agency has granted a waiver for E15 sales this summer, and has issued a rule allowing year-round sales in eight Midwestern states — including Iowa — beginning in 2025.

Under a state measure signed into law in 2022, Iowa gas stations must by 2026 offer the E15 blend of ethanol in at least one pump.

“I proposed the biofuels bill because Iowa farmers and renewable fuel producers are the economic backbone of our state, because Iowans and Americans deserve access to a reliable, less expensive, environmentally friendly option, and Iowans have delivered,” Gov. Kim Reynolds said when signing the bill. “And in doing so, we’ve sent a message that can’t be ignored: America’s energy is growing right here in Iowa’s fields.”

But because many gas stations do not have E15 or E85 pumps or storage tanks, government programs were begun to help subsidize the modifications. In addition to federal programs, Iowa’s Renewable Fuels Infrastructure Program has invested over $80 million while the industry has invested over $240 million in improving access to biofuels, according to the Iowa Department of Agriculture and Land Stewardship.

The U.S. Department of Energy says about 96 percent of the vehicles on U.S. roads today — or roughly 290 million — were made after 2000 and could use E15, although no motorcycle or heavier equipment like school buses ever should.

Additionally, over 22 million flex fuel vehicles — or about 8 percent of all vehicles — on U.S. roads are approved to use a much higher blend of ethanol, up to E85.

The Kwik Trip project will install 612 E15 dispensers and 151 B20 dispensers and install storage tanks at 60 fueling stations in Wisconsin, Minnesota, South Dakota and Iowa. Besides that and the Casey’s grants, projects involving Iowa will add another 66 E15 dispensers and 25 E85 dispensers and storage tanks across the state.