INTRODUCTION OF THE RENEWABLE FUELS AND ENERGY INDEPENDENCE PROMOTION ACT
Mr. HULSHOF. Mr. Speaker, today, my colleague Earl Pomeroy of North Dakota and I are introducing the Renewable Fuels and Energy Independence Promotion Act. We are joined by a bipartisan group of original cosponsors, a complete list of which follows this statement.
Rising fuel prices have again focused the public's attention on our nation's energy situation. Gas is at or near $3 a gallon across the country. We are importing over 60% of the oil we use, and this number is expected to grow to over 70% by 2025. In addition to our own increased domestic demand for energy, there is instability in oil-producing areas of the world, and demand for petroleum from China and India will continue to apply upward pressures on the price of oil.
Perhaps the one point in the energy debate that garners agreement from both sides of the aisle is that federal policy should strive to reduce our dependence on foreign oil. And though there may be ideological differences about how to achieve this end, there is broad, bipartisan consensus that domestically produced renewable fuels must play an integral role in a plan to promote energy independence.
Consistent with this common sense premise, we are introducing the Renewable Fuels and Energy Independence Promotion Act. This legislation will provide a permanent extension of the Tax Code's primary renewable fuels tax incentives for ethanol and biodiesel. The idea is to provide a single legislative vehicle for members to show their support of renewable tax incentives and to support a policy that sees a public good in reducing our dependence on foreign oil by boosting our energy independence.
If renewable fuels are to displace significant amounts of petroleum as transportation fuel, we must take bold, aggressive steps to achieve this end. History has demonstrated that the federal ethanol tax incentive has accomplished exactly what it is designed to do--promote the production and use of alcohol fuels. The numbers don't lie:
According to the Renewable Fuels Association, the United States produced 175 gallons of alcohol fuels in the year 1980. Today, we have an industry with a 4.817 billion gallon production capacity, and another 2.122 billion gallons of production capacity is currently under construction.
These numbers prove the tax incentive is working. Previous Congresses and Presidents--both Republican and Democrat--have recognized the benefits from replacing petroleum products with domestically produced renewable fuels. Long-term, consistent, and bipartisan support of ethanol tax incentives have yielded positive results that are helping reduce our dependence on foreign oil. As production increases and new technologies--such as cellulosic ethanol production--are perfected, renewable fuels will play an even greater role in our economy. History has shown us that the tax incentive works, and a long-term commitment to a federal policy that supports renewable fuels will help provide stability and promote growth for those working to expand the use of ethanol in the United States.
Congress should also strongly support efforts to promote biodiesel. Biodiesel is a clean-burning, renewable fuel that can be produced from a variety of feedstocks, including soybeans. It can be blended with diesel fuel and burned in conventional diesel engines without modification to the engine.
From a policy perspective, biodiesel shares many of the positive characteristics of ethanol. It is environmentally friendly and produced from renewable sources. Its production helps promote economic growth and opportunities in value-added agriculture. And most importantly, expanded use of biodiesel will help make America more energy independent by displacing petroleum products with a renewable fuel source.
Though there are distinct differences between biodiesel and ethanol, the situation facing the biodiesel industry today resembles the challenges facing ethanol industry upon its inception. I think we can replicate ethanol's success with biodiesel. If federal policy can increase demand and spur the development of the infrastructure required to utilize biodiesel, the nation as a whole will reap the benefits.
The current tax incentive took effect in 2005, and is currently set to expire after 2008. And though things are going well for the industry, and the market is beginning to embrace the fuel, there is more work that must be done. Federal policy should create an atmosphere that rewards entrepreneurs for investing their time and resources to build the production facilities and distribution systems needed to bring biodiesel to market. Providing certainty to the markets and to the industry will help further this progress, and federal policy can help provide this certainty through a long-term extension of the biodiesel tax incentive.
Mr. Speaker, I hope my colleagues will join me in supporting a strong federal commitment to the development of renewable fuels.
Original Cosponsors, Renewable Fuels and Energy Independence Promotion Act: Pomery, Nussle, Peterson, Shimkus, Terry, Boswell, Osborne, Emanuel, Moran (KS), Salazar, Moore (KS), and Herseth.