Minnesota Biodiesel Laws and Incentives

State Laws and Regulations

Regional Biofuels Promotion Plan

Minnesota has joined Indiana, Iowa, Kansas, Michigan, Ohio, South Dakota, and Wisconsin in adopting the Energy Security and Climate Stewardship Platform Plan (Platform) (PDF 2 MB), which establishes shared goals for the Midwest region, including increased biofuels production and use. Specifically, the Platform sets the following goals:

• Produce commercially available cellulosic ethanol and other low-carbon fuels in the region by 2012;
• Increase E85 availability at retail fueling stations in the region to 15% of stations by 2015, 20% by 2020, and 33% of all fueling stations in the region by 2025;
• Reduce the amount of fossil fuel that is used in the production of biofuels by 50% by 2025;
• By 2025, at least 50% of all transportation fuels consumed by the Midwest will be from regionally produced biofuels and other low-carbon transportation fuels.

The Platform also establishes a regional biofuels corridor program. The program directs state transportation, agriculture, and regulatory officials to develop a system of coordinated signage across the region for biofuels and advanced transportation fuels and to collaborate to create regional E85 corridors. The program requires standardized fuel product coding at fueling stations as well as increased education for retailers about converting existing fueling infrastructure to dispense E85. The state transportation, agriculture, and regulatory officials are required to report their corridor implementation plans to the Midwest Governors Association by April 1, 2008.

Biodiesel Definition

Biodiesel is defined as a renewable, biodegradable, mono alkyl ester combustible liquid fuel that is derived from agricultural plant oils or animal fats and that meets American Society for Testing and Materials (ASTM) specification D6751-07. (Reference Senate File 1193, 2007, and Minnesota Statutes 239.761 and 296A.01)

Alternative Fuel Use Requirement

State agencies are required to take all reasonable actions necessary to strengthen the infrastructure for increasing the availability and use of E85 and biodiesel throughout the state. Employees using state vehicles are expected to use E85 fuel when operating flexible fuel vehicles, whenever E85 is reasonably available. The state's SmartFleet Committee is directed to develop a plan to facilitate the use of E85 and biodiesel in state vehicles, including actively pursuing the establishment of additional E85 refueling facilities at public retail outlets throughout the state. (Reference Executive Order 06-03, 2006)

Biodiesel Blend Mandate

All diesel fuel sold or offered for sale in the state for use in internal combustion engines must contain at least 2% biodiesel fuel by volume. (Reference Minnesota Statutes 239.77 and 239.75)

Biodiesel Task Force

To help reach the state's eight million gallon biodiesel production capacity goal and ensure a smooth introduction of biodiesel into the marketplace, a Biodiesel Task Force was established in March 2003 to help promote and educate possible biodiesel developers, marketers, consumers, and manufacturers. The 10-member task force advises the Minnesota Department of Agriculture on methods to increase production and use of biodiesel in Minnesota.

Alternative Fuel Use and Alternative Fuel Vehicle (AFV) Acquisition Requirements

State agencies are required to use alternative fuels (B20-B100 biodiesel blends, compressed or liquefied natural gas, E70-E100 ethanol blends, hydrogen, or liquefied petroleum gas) in state motor vehicles if the clean fuels are reasonably available at similar costs to other fuels and are compatible with the intended use of the motor vehicle. Additionally, state agencies are required to purchase alternative fuel vehicles, which include those capable of being powered by the fuels listed above or motor vehicles powered by electricity or by a combination of electricity and liquid fuel, if such a motor vehicle is reasonably available at similar costs to other vehicles and if the vehicle is capable of carrying out the purpose for which it is purchased. (Reference Minnesota Statutes 16C.135)

State Agency Energy Plan and Vehicle Acquisition Priorities

Using 2005 as a baseline, the state is required to achieve a 25% and 50% reduction in the use of gasoline for state agency owned on-road vehicles by 2010 and 2015, respectively. Additionally, the state is required to achieve a 10% and 25% reduction in the use of petroleum-based diesel fuel for state owned on-road vehicles by 2010 and 2015, respectively. To meet these goals, each state agency will, whenever legally, technically, and economically feasible, ensure that at least 75% of new on-road vehicles purchased use alternative fuels (B20-B100 biodiesel blends, compressed or liquefied natural gas, E70-E100 ethanol blends, hydrogen, or liquefied petroleum gas). Alternatively, each state agency must ensure that at least 75% of purchases of new on-road vehicles have fuel economy ratings that exceed 30 miles per gallon (mpg) for city usage or 35 mpg for highway usage, including but not limited to hybrid electric and hydrogen vehicles. (Reference Executive Order 04-10, 2004, and Minnesota Statutes 16C.137)

State Agency Emissions Reduction Requirement

Each state department must seek to reduce air pollution by implementing two or more of the actions outlined in Executive Order 04-08 whenever legally, technically, and economically feasible, subject to the specific needs of the department and responsible management of agency finances. The actions include the purchase or lease of the most fuel-efficient and least polluting vehicles that meet the operational needs of the state department, and refueling state-operated vehicles with the cleanest fuel available. (Reference Executive Order 04-08, 2004)