End of ethanol tax credit seen boosting gas price

Des Moines Register
6:42 PM, Dec. 6, 2011
Written by DAN PILLER

The ethanol tax break expires at the end of the year; drivers will pay 4 cents more, an industry leader says.

The price of a gallon of gasoline will rise by about 4 cents per gallon after the tax credit for ethanol blending ends Jan. 1, chief executive officer Jeff Broin of Poet said Tuesday.

Broin noted that the presence of cheaper ethanol blended with gasoline lowers the pump cost to the consumer by 17 cents per gallon. This week Iowa’s average price for gasoline has been $3.18 per gallon, but most convenience stores in the Des Moines area have sold for $2.99 per gallon.

E85, or 85 percent ethanol, will rise by about 40 cents per gallon, Broin said. E85 has enjoyed a record year for sales in Iowa, and the fuel has tended to sell as much as 75 cents per gallon under the price of the 10 percent ethanol blend.

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