Congressional leaders short-listed biofuels for coronavirus relief. Iowa’s renewable fuels industry was the first to receive federal CARES Act funds, to help offset the impact of COVID-19.
Governor Kim Reynolds (R-IA) on Tuesday allocated roughly 100-million of one-point-two-five-billion dollars of federal CARES Act relief funds for a range of agricultural programs. Two of seven programs support Iowa’s renewable fuels industry.
“I believe this is the first time any state has taken the funds and done some direct assistance for biofuels producers, which is one of the programs,” Iowa Renewable Fuels Association executive director Monte Shaw says. “A little over $15 million will go into that, and that is going to be a lifeline for Iowa’s ethanol and biodiesel plants to continue to get through this difficult time.”
Renewable fuels production rates are on a path of recovery. Ten- to 15-percent of the state’s biofuels capacity is not being utilized, according to Shaw. He adds, “It is almost impossible to maintain any profitability in this situation,” which is why his industry is grateful to Governor Reynolds.
“You have these plants running a little bit under where they could, and anytime there’s any sign of profitability or different demand, all of the different plants go chase it. So until we can get demand and supply in much more of an equilibrium, it’s going to be very difficult,” Shaw says.
Governor Reynolds also provide support for small fuel retailers. The Renewable Fuel Retail Recovery Program offers funding to expand retail fueling infrastructure for higher blend renewable fuels.
“There’s about seven-million dollars that has been put into an infrastructure program for retailers to add infrastructure that would allow them to sell higher blends – E15 and higher on the ethanol side, B11 and higher on the biodiesel side. Retailers can use these grants to put in any equipment they need to offer these more attractive fuels,” Shaw says.