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Press Release - Grassley Urges the President to Continue Support for Renewable Fuels

By:
Date:
Location: Washington, DC


GRASSLEY URGES THE PRESIDENT TO CONTINUE SUPPORT FOR RENEWABLE FUELS

Sen. Chuck Grassley sent a letter to President Bush asking him to continue his support for the renewable fuel industry.

Grassley said that recent news reports have indicated that the Administration is planning to propose a new package of energy policies early in the new year. Grassley, who is a leading advocate for renewable energy and author of several tax incentives for alternative energy, is strongly opposed to any proposals that would negatively impact the growth of renewable fuels, including reducing the tax incentive or lifting the tariff on imported ethanol.

"We are on our way to developing a clean, reliable homegrown energy supply from America's Midwest, rather than relying on oil from the volatile Middle East," Grassley said. "Now is absolutely the wrong time to consider removing or modifying the existing incentives for the renewable fuels industry."

Here is a copy of Grassley's letter.

December 6, 2006

The Honorable George W. Bush
President of the United States
The White House
1600 Pennsylvania Avenue, NW
Washington, D.C. 20500

Dear President Bush:

Recent news reports have indicated that your Administration is planning to propose a new package of energy policies early in the new year. I write to you today to express my strong opposition to any proposals that would negatively impact the growth of renewable fuels, including reducing the tax incentive or lifting the tariff on imported ethanol.

Mr. President, under your leadership and the leadership of this Republican Congress, we have put in place and maintained supportive polices and incentives that have led to an extraordinary growth in the production of renewable fuels. With your guidance, Congress enacted a strong Renewable Fuels Standard that will ensure the use of 7.5 billion gallons of ethanol annually by 2012. We've maintained a tariff on imported ethanol that prevents our nation from becoming dependent on foreign ethanol or subsidizing ethanol produced in foreign countries. Perhaps most important, we improved and extended the ethanol tax incentive.

Each of these polices has contributed to the expansion and strong growth of the alternative fuels industry. But we are at a critical time. The outstanding growth in the production of ethanol is primarily a recent occurrence. The industry continues to need the certainty of these existing policies to grow and expand. And, if we are to be successful in the development of commercial cellulosic ethanol production, each of these policies must be maintained and extended, not lifted or eliminated.

Today, there are 109 ethanol facilities with the capacity to produce more than 5.2 billion gallons annually. Because of the policies put in place in recent years, there are currently 53 ethanol facilities and seven expansions under construction. We are on our way to developing a clean, reliable homegrown energy supply from America's Midwest, rather than relying on oil from the volatile Middle East. Now is absolutely the wrong time to consider or propose removing or modifying the existing incentives for the renewable fuels industry.

Earlier this year you stated, "The federal government has got a role to play to encourage new industries that will help this nation diversify away from oil. And so we're strongly committed to corn-based ethanol produced in America." A few months ago you clearly understood the need to protect our domestic ethanol industry so that they can get a foothold and succeed. I hope you still recognize the virtue in helping America's farmers and ranchers reduce our dependence on foreign oil.

I'm calling for you and your Administration to unequivocally reject any proposals to reduce or repeal the ethanol tax incentive and import tariff. Rather than eliminate the very policies that have worked to expand the industry, we should be working together to promote policies that will increase the production of alternative fuels, ensure their efficient transportation and provide for their broad consumer use.

Through a cooperative effort, we can take action to put America on a permanent path to energy independence. I hope I can count on you to work with me to support our nation's growing renewable fuels industry, and craft common sense polices to further encourage its development and growth.

Thank you for your consideration.

Sincerely,

Charles E. Grassley
United States Senator

cc: Mike Johanns, Secretary of Agriculture
Samuel Bodman, Secretary of Energy
Henry Paulson, Secretary of the Treasury
Rob Portman, Director, Office of Management and Budget

http://grassley.senate.gov/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=5225&Month=12&Year=2006

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