E-85 pump incentives not luring retailers

Iowa’s gas-station operators are not burning a path to take advantage of new state incentives to help install pumps that offer motorists fuel blended with 85 percent ethanol — a product they say is a slow seller due to a low number of flex-fuel vehicles.

Iowa Economic Development Board members were told today that 24 grants totaling about $650,000 have been awarded so far under a $13 million program that provides state matching funds for deploying pumps to dispense E-85 or bio-diesel fuels. The incentive program was designed to help the state eventually meet a statewide renewable fuel standard.

Dawn Carlson of the Petroleum Marketers and Convenience Stores of Iowa said there is reluctance to make a commitment of capital and space for the specialized pumps right now because of low and miscalculated demand factors.

“This legislation that was enacted this year was based on some false facts. There are not 100,000 flex-fuel vehicles in the state of Iowa, there are only 55,000 flex-fuel vehicles. So we’ve got a lot of growing to do yet before that demand for E-85 increases,” she said.

Cedar Rapids Gazette