Missouri governor proposes tax credits for E85 or hybrid use; incentives for E85 station conversion

In Missouri, Gov. Matt Blunt announced a series of tax incentive proposals designed to promote biofuels. The governor proposed $2 million in tax incentives for gas station owners converting to E85, and tax credits for consumers who buy E85 or a hybrid vehicle.

Missouri’s E10 mandate took effect January 1st. With the new law, Missouri joins Minnesota and Hawaii as the only states mandating E10. Most Missouri stations switched months previously, and the transition as reported to be smooth.

Missouri has a unique feature in its ethanol mandate allowing fuel retailers to switch back to unblended gasoline if the price of ethanol exceeds the price of gas. There are concerns that, if the price of ethanol drops below gas and retailers again sell E10, that they will have co-mingled fuels in their tanks that would bring them below the minimum blending requirement.

On the production side, Missourian ethanol plant development has slowed to a standstill, according to the state’s Department of Natural Resources. After boom conditions in recent years, no new plants have submitted new or revised permit applications since July, and of three plants that had previously received construction permits, none have proceeded to begin construction.

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