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Michigan lawmakers consider tax credit on sales of ethanol gas blends

Fill 'er up?
(photo by Steve Carmody/Michigan Radio)
Fill 'er up?

Michigan agriculture leaders are pushing legislation to encourage gas station owners to sell more ethanol-gasoline blended fuels.

The state Senate agriculture committee heard testimony Thursday on a proposed tax credit on sales of E15 (15% ethanol) and E85 (85% ethanol) fuel.

As proposed, retailers would get a 5 cent tax credit on each sale of a gallon of E15 fuel and an 8.5 cent tax credit per gallon of E85.

Industry supporters like Bob Thompson, president of the Michigan Farmers Union, say the tax credit would encourage gas station owners to expand the number of ethanol fuel gas pumps.

“Statewide availability of E15 across Michigan would drive demand for an additional 78 million bushels of corn annually, boosting incomes for our family farmers,” Thompson told senators during the committee hearing.

Environmentalists are concerned increasing use of ethanol fuels would negatively affect air and water quality in Michigan.

Megan Tinsley is with the Michigan Environmental Council. She shared her concerns with the senators that the increased use of ethanol fuels would negatively affect air quality.

“We do have areas of Michigan that are sometimes in non-attainment for ozone,” Tinsley testified, “Increasing the ethanol in the fuel supply and adding to that smog and ozone formation could present air quality threats.”

Environmentalists are also concerned that growing more corn for ethanol will increase can also lead to water quality problems.

The Senate committee is expected to continue reviewing the proposal.

Copyright 2022 Michigan Radio. To see more, visit Michigan Radio.

Steve Carmody has been a reporter for Michigan Radio since 2005. Steve previously worked at public radio and television stations in Florida, Oklahoma and Kentucky, and also has extensive experience in commercial broadcasting. During his two and a half decades in broadcasting, Steve has won numerous awards, including accolades from the Associated Press and Radio and Television News Directors Association. Away from the broadcast booth, Steve is an avid reader and movie fanatic. Q&A