Chair Putnam, Vice Chair Kupec, and Members of the Committee:
Growth Energy is the nation’s largest association of biofuel producers, representing 97 U.S. plants that each year produce more than 9.5 billion gallons of cleaner-burning, renewable fuel, including eight biorefineries in Minnesota. We also represent 128 businesses—including twelve associate members in Minnesota—associated with the production process; and tens of thousands of biofuel supporters around the country. Together, we remain committed to bringing better and more affordable choices at the fuel pump to consumers, helping our country diversify our energy portfolio in order to grow more energy jobs, sustaining family farms, and driving down the costs of transportation fuels for consumers with a lower carbon fuel.
Today, 98 percent of all gasoline sold in the U.S. contains 10 percent bioethanol. E15, a fuel containing up to 15 percent bioethanol, is now available at more than 4,700 retail locations in 34 states around the country.
E15 is approved for all 2001 and newer vehicles, more than 96 percent of all light duty vehicles on the road today. Most vehicles require a minimum octane rating of 87. Bioethanol, with an octane rating of 113, helps meet that in modern cars. Bioethanol is a cleaner, renewable, and cost-effective alternative to toxic chemicals like lead and MTBE. Consumers have now driven more than 205 billion miles on E15, and retailers have conducted millions of transactions with this fuel. There have been no adverse reports of fuel quality experienced with E15 since first being approved 13 years ago.
Growth Energy strongly supports Senate File 4263, which would provide an important incentive for higher bioethanol fuel blends. Specifically, this legislation would provide a 5 cent per gallon incentive to fuel retailers for every gallon of E15 sold. This incentive will
help Minnesota retailers continue to build out the market and invest in additional infrastructure to offer higher bioethanol blends of fuel.
Increased E15 access also give consumers more affordable choices at the pump. Earlier this year, drivers in Minnesota saw as much as 52 cents per gallon in savings when compared to E10. Providing a 5 cent per gallon incentive to offer higher bioethanol blend helps hardworking Minnesotans save on fuel costs without any impact to the state’s fuel tax revenue.
These economic benefits of increased E15 availability to Minnesota consumers could be even more pronounced as the price of oil increases if the current instability in the Middle East and Iran’s actions to disrupt the global energy market continues.
This incentive will also help Minnesota bioethanol producers and corn growers. At a time when American farmers are facing a 25% decrease in farm incomes, Minnesota corn growers can benefit from the increased demand for their crop.
When considering the consumer savings, the benefits to the agriculture and bioethanol industries, and noting no impact on Minnesota’s fuel tax revenue, the proposed incentive doesn’t affect the state’s bottom line. Several Midwestern states have successfully implemented similar incentives for higher bioethanol blends. As more states consider incentives, Minnesota should ensure its product made from Minnesota-grown corn benefits in-state drivers and saves them at the pump.
Given our experience with retailers around the country offering E15, we are happy to assist the committee with technical questions as they consider this important legislation. We look forward to working with you to finalize this important benefit for Minnesota drivers,
fuel retailers and farmers. Thank you in advance for your consideration.