The Fuel Choice Coalition—a unified voice of Iowa fuel distributors, retailers, wholesalers, and transportation groups—responded to the new amendment released on the proposed government fuel mandate in the Iowa legislature.
“There’s no way around it: The current version of this bill will result in Iowa consumers paying substantially more at the pump for gasoline and diesel,” added FUELIowa President and CEO Ronald N. Langston. “Any Iowan who wants to fill their tank with non-ethanol gasoline will pay upwards of over 50 cents more per gallon at the pump—if you own a pickup, that means over $12 more per fill and nearly $10 more per fill for a minivan driver. This bill does the opposite of creating a healthy marketplace, and I urge legislators to reject this amendment at the door.”
The amendment released for House Study Bill 185 bans the sale of ethanol-free 87 octane, or “regular” unleaded gasoline in Iowa, which consumers commonly select for a wide range of uses. Therefore, 91 octane or higher, or “premium” gasoline, would be the only ethanol-free gas available in the state. According to AAA, as of April 1, 2021, the average price of premium gas in Iowa is $3.318—over 53 cents higher than the average price of $2.783 for regular gasoline.
The amendment at large imposes more sweeping restrictions on the fuel industry, placing key business decisions solely into the hands of the government, eliminating consumer choice and the ability for the retail fuel industry to determine which fuels they can sell. The increased requirements also mean that the government would have the sole authority over which labels go on the pumps and where they may be located, along with additional civil penalties if retailers designate that certain fuels are alcohol-free.
Notably, agricultural and “off-road” fuel uses are exempted from the mandates this legislation imposes directly on the retail fuel industry, small businesses, and consumers. The retail fuel industry and related small businesses will be forced to abide by marketing practices designed by the Iowa Department of Agriculture, including strict requirements on product labeling and the placement of the labels on pumps.
“This proposed amendment is a blatant use of overregulation in order to pick winners and losers in the marketplace—when that happens, consumers lose,” stated Drew Klein, State Director for Americans for Prosperity – Iowa. “This is a mandate through-and-through that rejects free-market principles and is the wrong road for Iowa to take. Our state’s small and rural businesses thrive because of the choices and access they provide customers—we should not be forcing them to raise prices just to keep their doors open.”
Along with these restrictions, the amendment includes zero new funding from the Renewable Fuel Infrastructure Program (RFIP) to help businesses meet these strict infrastructure upgrades. The Fuel Choice Coalition estimates the proposed fuel mandate will cost businesses at least $1 billion to upgrade Iowa’s infrastructure to meet the mandate’s requirements. This amendment amplifies the economic impact of the bill and would cause consumer prices to increase dramatically.
“This amendment raises prices on anyone needing 91 octane and eliminates 87 octane ethanol-free fuel,” stated Jodi Right, State Legislative Officer for A.B.A.T.E. of Iowa. “Restricting options while simultaneously raising fuel prices is the wrong choice. This has long lines, fewer pumps, and inconvenience written all over it, and motorcyclists across our state are not going to be happy about it.”
The Fuel Choice Coalition is opposed to this amendment and the fuel mandate, and has urged concerned Iowans to contact their legislators through the Fuel Choice Coalition Action Center.