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Congressman Joe Donnelly's Pump Act Included in House-Approved Energy Legislation

Press Release

Location: Plymouth, IN


Donnelly discusses legislation that promotes renewable fuels at Family Express in Plymouth

(Plymouth, IN) - Last week, the House passed two pieces of comprehensive energy legislation that aim to increase America's use of renewable fuels. Those bills—H.R. 3221, The New Direction for Energy Independence, National Security, and Consumer Protection Act and H.R. 2776, The Renewable Energy and Conservation Tax Act of 2007— passed with Congressman Joe Donnelly's support.

"With places like Family Express offering consumers ethanol-based E-85, our nation is taking another step toward an energy independent future," Donnelly said. "It is my hope that these bills will accelerate the use of clean domestic renewable energy sources amongst consumers and corporations alike."

The first, H.R. 3221, The New Direction for Energy Independence, National Security, and Consumer Protection Act passed the House by a vote of 241 to 172 and included a key provision of H.R. 2505, The Promoting Use of Mixed Petroleum (PUMP) Act that Donnelly introduced at the end of May. This part of the bill would amend the Petroleum Marketing Practices Act to explicitly prohibit an oil company from restricting the right of a franchisee to install qualified alternative fuel vehicle refueling equipment, such as E-85 pumps.

While there are a number of reasons why ethanol has yet to mature on the market, a significant contributing factor is that many of the big oil companies use a variety of strategies to make it difficult for their franchised gas stations to offer ethanol. For example, the standard contract issued by many big oil companies prevents franchisees from purchasing fuel from anyone other than the franchise supplier. Since many suppliers do not sell E-85, the stations within that franchise cannot either.

Companies that do supply E-85 often prohibit the sale of the alternative under the main canopy; require E-85 prices to be displayed on separate signs; and prohibit gas stations from accepting franchise credit cards for the purchase of E-85.

"When faced with the possibility of losing profit to the competition, big oil companies have sought to eliminate the competition by prohibiting franchisees from selling alternative fuels," Donnelly said. "These tactics not only limit consumer choice, but also protect big oil profits and reinforce our dependence on non-renewable fuel sources. In passing H.R. 3221, the House took a crucial step in expanding the availability of E-85 so more Americans can take advantage of this clean fuel made from corn grown right here in Indiana."

The other, H.R. 2776, The Renewable Energy and Conservation Tax Act of 2007, passed the House by a vote of 221 to 189 andincluded the other key provision of Donnelly's PUMP Act that would expand the Alternative Fuel Infrastructure Tax Credit. Currently, the federal government offers an Alternative Fuel Infrastructure Tax Credit in order to encourage further investment in E-85 infrastructure. Under the current credit, gas station owners can claim 30 percent of the costs of installing or retrofitting alternative refueling property (i.e., E-85 pumps) up to $30,000. However, the provision in H.R. 2776 would expand this tax credit to allow gas station owners to claim 50 percent of the cost of alternative refueling property up to $50,000.

"We need to give gas station owners a reason to install the equipment necessary to sell E-85," Donnelly said. "I'm pleased that my colleagues on the Ways and Means Committee recognized that by expanding the Alternative Fuel Infrastructure Tax Credit, more gas station owners are likely to put in the equipment to dispense E-85. Alternative energy sources are critical for decreasing our dependence on foreign oil and creating jobs right here in Indiana. My legislation would make it easier for gas stations, and ultimately the consumer, to invest in our security, our environment, and our communities."

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