Bill Summary – FastDemocracy

Senate File 2418 - Introduced
                                  SENATE FILE 2418
                                  BY COMMITTEE ON APPROPRIATIONS
                                  (SUCCESSOR TO SSB 3187)
                            A BILL FOR
An Act relating to renewable fuel infrastructure, including by
  providing for a financing program, and including effective
  date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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    Section 1. Section 159A.14, subsection 1, paragraph
 a, subparagraph (1), Code 2024, is amended by striking the
 subparagraph and inserting in lieu thereof the following:
    (1) (a) Except as provided in this subparagraph, the
 ethanol infrastructure shall have the capacity to store and
 dispense E-85 gasoline.
    (b) (i) If the ethanol infrastructure is not used to store
 and dispense E-85 gasoline, it must have the capacity to store
 and dispense ethanol blended gasoline classified as E-15 or
 higher.
    (ii) This subparagraph division is repealed January 1,
 2026.
    (c) (i) If the ethanol infrastructure is not used to store
 and dispense E-85 gasoline, it must have the capacity to store
 and dispense ethanol blended gasoline classified as E-40 or
 higher.
    (ii) This subparagraph division shall be implemented
 beginning January 1, 2026.
    (iii) This subparagraph division is repealed July 1, 2030.
    (d) The ethanol infrastructure may store, blend, and
 dispense ethanol or ethanol blended gasoline from a motor
 fuel blender pump. The ethanol infrastructure must at least
 include a motor fuel blender pump that dispenses different
 classifications of ethanol blended gasoline, if it allows E-85
 gasoline to be dispensed at all times that the blender pump is
 operating.
    Sec. 2. Section 455G.30, Code 2024, is amended by adding the
 following new subsections:
    NEW SUBSECTION. 4A. “Dispenser breakaway” means the part
 of gasoline storage and dispensing infrastructure that acts to
 immediately stop the flow of motor fuel from its storage system
 to its dispenser in the event that its dispensing hose or
 associated hanging infrastructure becomes detached, including
 when a vehicle pulls away from the dispenser while its nozzle
 is attached to the vehicle.
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    NEW SUBSECTION. 4B. “E-85 gasoline” means the same as
 defined in section 214A.1.
    NEW SUBSECTION. 8. “Shear valve” means the part of gasoline
 storage and dispensing infrastructure that acts to immediately
 stop the flow of motor fuel from its storage system to its
 dispenser in the event of an emergency hazard, including but
 not limited to a vehicle impacting the dispenser or a fire.
    Sec. 3. Section 455G.31, subsection 2, Code 2024, is amended
 to read as follows:
    2. Subject to section 455G.32, a retail dealer may use
 gasoline storage and dispensing infrastructure to store and
 dispense ethanol blended gasoline classified as E-9 or higher
 if the department under this subchapter, or the director of the
 department of inspections, appeals, and licensing under chapter
 101, determines that the gasoline infrastructure is compatible
 with the classification of ethanol blended gasoline being used.
    Sec. 4. Section 455G.32, Code 2024, is amended to read as
 follows:
    455G.32 E-85 gasoline Ethanol blended gasoline —— compatible
 infrastructure —— compliance requirement.
    1. A retail dealer shall not install, replace, or convert
 gasoline storage and dispensing infrastructure used to store
 and dispense ethanol blended gasoline classified as E-15 or
 higher, unless the installed, replaced, or converted gasoline
 infrastructure, that includes all parts prior to the point
 where the dispenser breakaway ends, is capable of storing
 and dispensing ethanol blended gasoline classified as E-85
 gasoline.
    2. a. Notwithstanding subsection 1, a retail dealer
 may install, replace, or convert any part of the gasoline
 infrastructure beginning at a point where the shear valve ends
 and continuing until the point where the dispenser breakaway
 ends that is incompatible with E-85 gasoline. However, that
 part of the gasoline infrastructure must be compatible with the
 following:
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    (1) (a) Ethanol blended gasoline classified as E-15 or
 higher.
    (b) This subparagraph is repealed January 1, 2026.
    (2) (a) Ethanol blended gasoline classified as E-40 or
 higher.
    (b) This subparagraph shall be implemented beginning
 January 1, 2026.
    b. This subsection is repealed July 1, 2030.
    2. 3. The gasoline infrastructure must be all of the
 following:
    a. Listed as compatible for use with ethanol blended
 gasoline classified for that part of the gasoline
 infrastructure as E-85 provided in subsection 1 by an
 independent testing laboratory or as approved by the
 manufacturer.
    b. Approved by the department or state fire marshal the
 director of the department of inspections, appeals, and
 licensing subject to conditions determined necessary by the
 department or state fire marshal the director of the department
 of inspections, appeals, and licensing. The department
 or state fire marshal the director of the department of
 inspections, appeals, and licensing may waive the requirement
 in paragraph “a” upon satisfaction that a substitute
 requirement serves the same purpose.
    Sec. 5. Section 455G.33, subsection 2, paragraph b, Code
 2024, is amended to read as follows:
    b. Approved by the department, or director of the department
 of inspections, appeals, and licensing under chapter 101,
 subject to conditions determined necessary by the department
 or director of the department of inspections, appeals, and
 licensing. The department or director of the department of
 inspections, appeals, and licensing may waive the requirement
 in paragraph “a” upon satisfaction that a substitute
 requirement serves the same purpose.
    Sec. 6. APPLICATIONS FOR FINANCIAL INCENTIVES. This
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  Act does not require the renewable fuel infrastructure board
  established in section 159A.13 to reconsider or reapprove a
  decision made prior to the effective date of this Act for
  an award of financial incentives under the renewable fuel
  infrastructure program for retail motor fuel sites established
  in section 159A.14.
     Sec. 7. EFFECTIVE DATE. This Act, being deemed of immediate
  importance, takes effect upon enactment.
                            EXPLANATION
         The inclusion of this explanation does not constitute agreement with
          the explanation’s substance by the members of the general assembly.
    BACKGROUND —— GENERAL. This bill provides for the use
 of infrastructure used to store and dispense ethanol blended
 gasoline owned by a retail dealer of motor fuel (retail
 dealer) who sells gasoline on a retail basis from a permanent
 geographic location referred to as a retail motor fuel site
 (retail site) (Code section 214A.1).
    BACKGROUND —— TERMINOLOGY. Ethanol blended gasoline refers
 to a formulation of gasoline blended with ethyl alcohol that
 meets fuel standards adopted by the department of agriculture
 and land stewardship (DALS) (Code sections 214A.1 and 214A.2)
 in accordance with ASTM international specifications and the
 federal Clean Air Act Amendments of 1990 (42 U.S.C. §7661)
 administered by the United States environmental protection
 agency (EPA). Classifications of ethanol blended gasoline
 are generally determined by the volume percent of ethanol
 and designated as E-xx where “xx” stands in for the volume
 percent of ethanol. There are three principal types of ethanol
 blended gasoline referred to commonly as E-10 formulated with
 9 or 10 percent ethanol by volume, E-15 formulated with 15
 percent ethanol by volume, and the highest classification E-85
 formulated with between 68 to 83 percent ethanol by volume
 (Code section 214A.1). Generally, the use of E-15 during
 summer months is allowed only by waiver issued by the EPA.
    BACKGROUND —— E-15 ACCESS STANDARD. Beginning July 1, 2023,
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 a retail dealer is required to comply with an E-15 access
 standard that requires a retail dealer to advertise for sale
 and sell E-15 from a minimum number of qualifying gasoline
 dispensers, commonly described as pumps, located at the retail
 dealer’s retail site (Code chapter 214A, subchapter III).
 There are two access standards. In order to comply with the
 general E-15 access standard, the retail dealer must dispense
 E-15 from one qualifying gasoline dispenser if there is only
 one such dispenser located at the retail site or from at least
 50 percent of all qualifying dispensers if there is more than
 one such dispenser located at the retail site. In order to
 comply with the alternative E-15 access standard, the retail
 dealer cannot install, replace, or convert a gasoline storage
 tank at the retail site on or after July 1, 2023, and the retail
 dealer must advertise for sale and sell E-15 from at least one
 qualifying dispenser on and after January 1, 2026. Once the
 retail dealer no longer complies with the alternative E-15
 access standard (e.g., by installing a new tank), the retail
 dealer must comply with the general E-15 access standard. An
 exemption exists for small retail motor fuel sites in operation
 prior to January 1, 2023 (Code section 214A.36).
    BACKGROUND —— INFRASTRUCTURE PROGRAM FOR RETAIL MOTOR FUEL
 SITES. Under the renewable fuel infrastructure program for
 retail motor fuel sites (financing program), an eligible retail
 dealer may be awarded moneys on a cost-share basis by the
 renewable fuel infrastructure board (RFIB) and DALS to assist
 in improving the retail dealer’s retail site by installing,
 replacing, or converting infrastructure (new infrastructure) to
 be used to store, blend, or dispense ethanol blended gasoline
 in compliance with the general E-15 access standard (Code
 section 159A.14). Thus, the financing program could be used
 to upgrade infrastructure that had been used to store and
 dispense E-0 or E-10. However, the new infrastructure must
 have the capacity of storing and dispensing either E-85 only or
 a variety of classifications ranging from E-15 to E-85 as part
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 of a blender pump system.
    BACKGROUND —— NEW INSTALLATION OF GASOLINE INFRASTRUCTURE.
 Generally, the department of natural resources regulates
 infrastructure used to store and pump motor fuel stored in
 underground tanks, including ethanol blended gasoline, located
 at a retail site. The department of inspections, appeals, and
 licensing regulates infrastructure used to store motor fuel in
 aboveground tanks and aboveground equipment used to dispense
 motor fuel. A retail dealer at such a retail site who uses
 infrastructure compatible with E-15 must install, replace, or
 convert that infrastructure with new infrastructure that is
 compatible with E-85 (Code section 455G.32).
    BILL’S PROVISIONS —— INFRASTRUCTURE PROGRAM FOR RETAIL
 MOTOR FUEL SITES. The bill provides a transition period for
 infrastructure supported by an award of cost-share moneys
 under the financing program. Until January 1, 2026, the new
 infrastructure must be compatible with E-15; from January
 1, 2026, until July 1, 2030, the new infrastructure must be
 compatible with ethanol blended gasoline classified as E-40;
 and on and after July 1, 2030, the new infrastructure must be
 compatible with E-85. The bill’s provisions do not affect
 decisions regarding financing by the RFIB made prior to the
 bill’s effective date.
    BILL’S PROVISIONS —— NEW INSTALLATION OF GASOLINE
 INFRASTRUCTURE. The bill recognizes a dispenser breakaway
 which is that part of the infrastructure that acts to
 immediately stop the flow of motor fuel from its storage system
 to its dispenser in the event that its dispensing hose or
 associated hanging infrastructure becomes detached. The bill
 provides that the E-85 compatibility requirement exists for
 all parts of the infrastructure prior to the point where the
 dispenser breakaway ends. Otherwise, a similar transition
 period exists to the other parts of the infrastructure except
 for that part extending from the shear valve through to the
 dispenser breakaway. Until January 1, 2026, those parts must
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 be compatible with E-15; from January 1, 2026, until July 1,
 2030, those parts must be compatible with E-40; and on and
 after July 1, 2030, those parts must be compatible with E-85.
    BILL’S PROVISIONS —— EFFECTIVE DATE. The bill takes effect
 upon enactment.
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Statutes affected: 
Introduced: 159A.14, 455G.30, 455G.31, 455G.32, 455G.33