Democratic News

Not to overwhelm you today with e-mails, but we thought this letter from 29 Senators to the GOP leaders of the energy conference is worth sharing: October 17, 2003 Dear Senator Domenici and Congressman Tauzin: We write to reiterate that the Renewable Fuels Standard, the volumetric ethanol excise tax credits, and the biodiesel excise tax credit contained in the Senate energy bill are critically important to growth of the renewable fuels industry in our states, and to urge you to oppose any effort to weaken these important provisions or eliminate them from the final conference bill. As you know, we have been working for the past several years to encourage predictable growth in the ethanol industry through the enactment of a Renewable Fuels Standard. By setting realistic annual production targets for the next ten years, the Senate language will encourage investment in new farmer and investor-owned ethanol plants that will boost production, stimulate rural economic activity and foster greater competition in the ethanol industry. USDA estimates that the Senate language will raise corn prices 50 cents per bushel, generate 214,000 new jobs throughout the country, and increase the U.S. Gross Domestic Product by $156 million annually by 2012. The Senate RFS language has been thoroughly vetted by all interested parties. It has been reported by the Senate Environment and Public Works Committee on two separate occasions, and has passed the Senate as part of larger energy legislation both last year and this year. We believe it is critical that the final RFS language mirror what the Senate has supported. Making it easier for states not to participate in the RFS, as the House language does, will create uncertainty in the marketplace, thereby destabilizing prices and discouraging growth in the industry. We will not support increasing loopholes for states to opt-out of the newly created RFS schedule or eliminating the winter/summer balance requirement. Further, we believe that any final energy deal must include the Senate=s volumetric ethanol tax credit. Twenty-five years ago, Congress created the excise tax exemption for ethanol to encourage the increased production and use of this domestically grown renewable fuel. While this incentive has been extremely beneficial for the ethanol industry, it has also reduced the amount of funds that go to the Highway Trust Fund each year. The Senate provision corrects this anomaly, providing an additional $4 billion to the Highway Trust Fund each year while enhancing the delivery of renewable fuels in the marketplace by continuing the excise tax for ethanol. Additionally, we believe that a tax incentive should be extended to biodiesel, which enjoys no major federal subsidies as do all other major fuels. As you know, the biodiesel excise tax credit is modeled after the ethanol excise tax credit established in the bill and does not affect the Highway Trust Fund in any way. Additionally, biodiesel works in any diesel engine without modification and has similar horsepower, torque and BTU content as petroleum-based diesel, while offering higher octane and reducing potential cancer causing compounds by 80 to 90 percent. The Senate version of the tax package contains important provisions to incentivize the use of biodiesel. Inclusion of this provision is critical for the continued growth and viability of the biodiesel industry and would lead to an estimated 500 million gallons of additional biodiesel used annually nationwide. Biodiesel is a phenomenal fuel and any forward-looking and comprehensive energy package should include incentives for its use. Any attempts to undermine the effect of these provisions would be a perversion of their policy intent and a devastating blow to the economy of rural America. We look forward to working with you to ensure that this does not occur. [Signed] Sen. Coleman Sen. Daschle Sen. Baucus Sen. Bond Sen. Brownback Sen. Bunning Sen. Burns Sen. Carper Sen. Conrad Sen. Crapo Sen. Dayton Sen. Dole Sen. Dorgan Sen. Durbin Sen. Hagel Sen. Harkin Sen. Johnson Sen. Lincoln Sen. McConnell Sen. Murkowski Sen. Ben Nelson Sen. Pryor Sen. Roberts Sen. Smith Sen. Stabenow Sen. Talent Sen. Voinovich Sen. Stevens Sen. DeWine