Study: Iowa biofuel economy declined in 2015 due to reduced RFS levels

Ethanol remains as one of the important elements keeping the economy of the US State of Iowa afloat, despite it taking a slight hit in 2015, a new study has found.

According to a research published by the Iowa Renewable Fuels Association (IRFA), the decline is due to the reductions ethanol faced in the federal Renewable Fuel Standard (RFS).

The study, authored by John Urbanchuk of ABF Economics and commissioned by the IRFA, found that in 2015 the renewable fuels industry in Iowa supported nearly 43,000 jobs throughout the entire Iowa economy, generated almost $2.3 billion (€2bn) in household income, and accounted for about $4.6 billion, or 3.5%, of Iowa GDP.

“We have been disappointed by the Environmental Protection Agency (EPA)’s unwillingness to restore a robust RFS. This study shows how important renewable fuels are for the future of our Iowa economy,” said Iowa Governor Terry Branstad. 

Iowa is the US leader in renewable fuels production with 43 ethanol refineries capable of producing 4 billion gallons annually, including nearly 55 million gallons of annual cellulosic ethanol production capacity.

In addition, Iowa has 12 biodiesel facilities with the capacity to produce nearly 315 million gallons annually.

“While Iowa’s ethanol and biodiesel industries continue to power the state’s economy, it’s disappointing that those impacts took a small step backwards last year,” stated IRFA executive director Monte Shaw.

“When the EPA reduced the statutory RFS levels, it reduced our ability to grow ethanol and biodiesel production, to grow forward-looking investments into new technologies, to grow farm income, and to grow Iowa jobs,” Shaw said.

The IRFA was formed in 2002 to represent Iowa’s liquid renewable fuels industry.

The trade group fosters the development and growth of the renewable fuels industry in Iowa through education, promotion, legislation, and infrastructure development.