Chairman Blessing, Vice Chair Roegner, Rating Member Smith, and members of the Committee: Thanks for the chance to offer testimony in help of Home Invoice 324 on behalf of Development Power.
My identify is Dallas Gerber, Director of State Authorities Affairs for Development Power. We’re the world’s largest affiliation of bioethanol producers, representing 97 producer vegetation, together with 5 vegetation right here in Ohio, and 119 companies related to bioethanol manufacturing. Collectively, our members produce greater than 9.5 billion gallons of cleaner-burning, reasonably priced gas. Collectively, we’re dedicated to bringing higher and extra reasonably priced decisions on the pump for shoppers, serving to our nation variety our power portfolio, creating extra power jobs, and sustaining household farms.
Producing ethanol gives a virtually threefold enhance from the power put into manufacturing with rising plant effectivity and a rising suite of coproducts. Our business merely takes the starch from the kernel of corn turning it into bioethanol, whereas the remainder of the fats, fiber, and protein continues into nutrient-rich animal feed, corn oil which is used for extra biofuel manufacturing, and carbon dioxide, which is captured for industrial meals and beverage use.
In the present day, 98 % of all gasoline offered in the USA comprises 10 % bioethanol. E15— a gas containing as much as 15% bioethanol—is accredited to be used in all automobiles mannequin yr 2001 and newer. 96% of the automobiles on the highway as we speak can run on E15. Shoppers throughout the nation have now pushed 100 billion miles on E15. There have been no opposed stories on gas high quality skilled with E15 since first being accredited in 2011.
Whereas E15 is obtainable at greater than 3,400 retail places in 33 states, Ohio is falling behind. There are solely 144 retail places promoting E15 within the state. That’s round 2 % of all stations in Ohio are promoting E15. Examine that to Minnesota which has almost 500 places promoting E15 or Wisconsin which has at the very least 350 places.
We imagine this laws would offer an essential, and non permanent, tax credit score to incentivize E15. Particularly, the invoice’s nonrefundable 5 cent per gallon tax credit score for gas retailers who supply E15 helps Ohio compete with different Midwest states which can be increasing E15 choices by related means.
Whereas Ohio ranks seventh in bioethanol manufacturing in the USA, latest information reveals it’s second to final in time period of statewide bioethanol mix charges. The one state with a decrease mix charge is Alaska, which has zero bioethanol. Merely put, Ohio is just not using an Ohio-grown product that may assist cut back gas prices for drivers. For example, on the comparatively few retailers providing E15 within the state, Ohio drivers saved a median of 16 cents per gallon through the summer time of 2023. In some cases, drivers even saved as a lot as 40 cents per gallon.
This non permanent credit score is essential to make sure retailers that Ohio’s E15 market will proceed to construct out and put money into extra infrastructure, serving to place Ohio for the long run. It gives a chance to extend the home marketplace for Ohio’s corn growers, who face the prospect of a 25% decline in farm revenue in accordance USDA forecasts. Incentivizing E15 permits Ohio-grown corn to change into reasonably priced gas for Ohio drivers, who can be saving a number of multiples of the non permanent 5 cent incentive for each gallon of E15 they buy.
The elevated utilization of ethanol additionally ends in the provision of extra nutrient-rich animal feed, an essential co-product within the bioethanol manufacturing course of, to the good thing about Ohio livestock farmers.
When the financial advantages to the buyer, and downstream advantages to the agriculture and bioethanol industries are thought of together with there being no unfavorable impression on Ohio’s gas tax income, this proposal doesn’t impression the state’s backside line. As extra states implement or think about related incentives, we imagine it’s important Ohio does the identical, thus guaranteeing a product made in Ohio utilizing corn grown in Ohio can profit Ohio shoppers with decrease costs on the pump for a few years to return.
Thanks on your time, and I might be joyful to reply any questions the committee might have.
