Congressman Donnelly Introduces Legislation to Encourage Construction of Biofuels Pipelines

Press Release

Congressman Donnelly Introduces Legislation to Encourage Construction of Biofuels Pipelines

Today, Congressman Joe Donnelly introduced The Biofuels Pipeline Act to promote the construction of new biofuels pipelines. Moving biofuels through pipelines, rather than by rail or truck, would be cheaper and faster and make them more widely available to consumers.

"I am proud to introduce this common-sense legislation, which would make the transport of biofuels much easier," Donnelly said. "Building the infrastructure needed to better transport biofuels is a necessary part of developing a new energy policy for our country."

Publicly Traded Partnerships (PTPs), which construct and operate most pipelines, do not build pipelines for biofuels because the tax code actually discourages their construction. Under current law, PTPs do not pay corporate taxes if 90 percent of their revenue comes from the transportation of natural resources like oil, gas and coal. PTPs do not get the same tax benefit, however, if 10 percent or more of their revenue is generated from the transport of biofuels. Donnelly's bill would eliminate this disparity, making the same tax benefit available to PTPs regardless of whether their pipelines transport oil or biofuels.

"Because of the unique qualities of biofuels, existing pipelines are not designed to carry them. Not only does this make it harder for biofuels producers to get their product to market, but it also just doesn't make any sense to prevent companies with expertise in pipeline construction from building new infrastructure for the distribution of homegrown energy."

A companion bill, S.3291, was introduced in the Senate by Senator Tom Harkin of Iowa and Senator Richard Lugar of Indiana.

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