Chairman Smith,
Development Vitality is the world’s largest affiliation of biofuel producers, representing 97 U.S. crops that every 12 months produce greater than 9.5 billion gallons of cleaner-burning, renewable gas, together with 5 of Kanas’ twelve biorefineries. We additionally characterize 123 companies—together with six affiliate members in Kansas—related to the manufacturing course of; and tens of hundreds of biofuel supporters across the nation. Collectively, we stay dedicated to bringing higher and extra inexpensive decisions on the gas pump to shoppers, serving to our nation diversify our vitality portfolio as a way to develop extra vitality jobs, sustaining household farms, and driving down the prices of transportation fuels for shoppers.
Right this moment, 98 % of all gasoline bought within the U.S. comprises 10 % bioethanol. E15, a gas containing as much as 15 % bioethanol, is now obtainable at greater than 3,700 retail areas in 33 states, and better bioethanol blends resembling E85 can be found at practically 6,000 websites across the nation. In Kansas, there are 72 retail areas promoting E15 and 90 areas promoting E85.
E15 is authorized for all 2001 and newer autos, greater than 96 % of all gentle responsibility autos on the street as we speak. Most autos require a minimal octane score of 87. Bioethanol, with an octane score of 113, helps meet that in fashionable automobiles. Bioethanol is a cleaner, renewable, and cost-effective various to poisonous chemical compounds like lead and MTBE. Customers have now pushed greater than 140 billion miles on E15, and retailers have performed hundreds of thousands of transactions with this gas. There have been no hostile experiences of gas high quality skilled with E15 since first being authorized 13 years in the past.
Development Vitality appreciates this chance to help Home Invoice 2012, which would offer an necessary tax credit score for bioethanol gas blends from 15 to 85 %. Particularly, this laws would offer a non-refundable 5 cent per gallon tax credit score to gas retailers for each gallon of upper bioethanol gas blends bought. This credit score is necessary as retailers in Kansas proceed to construct out the market and put money into further infrastructure to supply these greater bioethanol blends.
Bioethanol blends resembling E15 and E85 additionally give shoppers extra inexpensive decisions on the pump. Throughout the summer season of 2023, Kansans saved a median of 11 cents per gallon on E15 in comparison with E10. Offering a 5 cent per gallon tax credit score to incentivize a better bioethanol mix helps hardworking Kansans save on gas prices with none affect to the state’s gas tax income.
This credit score will even assist Kansas bioethanol producers, corn growers and sorghum producers, and livestock farmers. At a time when American farmers are dealing with a 25% lower in farm incomes, Kansas corn growers and sorghum producers can profit from the elevated demand for his or her crop. The tax credit score may end result within the buying of as a lot as 1.7 million further bushels of Kansas corn yearly to provide a further 5 million gallons of bioethanol. This elevated manufacturing in bioethanol additionally leads to the supply of a further 29 million kilos of nutrient-rich animal feed, an necessary co-product within the bioethanol manufacturing course of, for Kansas livestock farmers.
When contemplating the patron financial savings, the advantages to the agriculture and bioethanol industries, and noting no affect on Kansas’ gas tax income, the proposed retail tax credit score doesn’t have an effect on the state’s backside line. A number of Midwestern states have efficiently applied comparable tax incentives for greater bioethanol blends. As extra states contemplate incentives, Kansas ought to guarantee its product comprised of Kansas-grown corn and sorghum advantages Kansas drivers.
Given our expertise with retailers across the nation providing bioethanol blends, we’re completely happy to help the committee with technical questions as they contemplate this necessary laws. We look ahead to working with you to finalize this necessary profit for Kansas drivers, gas retailers and farmers. Thanks upfront in your consideration.
