Renewable Fuels Impact on the Iowa Economy 2020
Contribution of the Renewable Fuels Industry to the Economy of Iowa
By John Urbanchuk, Managing Partner, ABF Economics
March 11, 2020
Prepared for the Iowa Renewable Fuels Association
With 4.2 billion gallons of ethanol production and 342 million gallons of biodiesel production in 2019, Iowa continues to be the nation’s biofuels leader. Hampered by demand destruction due to rampant Renewable Fuel Standard (RFS) refinery exemptions, production for both fuels went down in 2019 from the previous year’s records. This is the first-ever year-on-year reduction of Iowa ethanol production. Despite this, renewable fuels continue to make a significant contribution to the Iowa economy. Further potential exists for Iowa biofuel production to benefit job creation, household earnings, and petroleum displacement but uncertainty around the RFS and trade can impede the industry’s ability to capitalize on this potential.
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Renewable Fuels Continue to Drive Iowa Forward
Based on its size and scope, the renewable fuels industry has the following impacts on Iowa’s economy:
- Accounts for more than $5.0 billion, or about 3%, of Iowa GDP;
- Generates over $2.4 billion of income for Iowa households; and
- Supports more than 48,000 jobs through the entire Iowa economy.
*Includes agriculture, investment in R&D, and exports