Noem Introduces Ethanol Compromise

Press Release

U.S. Representative Kristi Noem (R-SD) will introduce a compromise bill today that would end the $.45/gallon Volumetric Ethanol Excise Tax Credit (VEETC) for ethanol on July 1st, 2011 and use the available funds for deficit reduction as well as ethanol delivery infrastructure.

Some ethanol opponents are pushing a plan to end the tax credits for ethanol immediately, despite the fact that these same tax credits that were extended at the end of last year with the support of the House, Senate and White House in a bipartisan manner.

"I am as concerned about our deficit as any other member of Congress, but we cannot hang the ethanol industry out to dry with such a drastic policy change, so quickly with so little debate. I am working with colleagues here in the House on a proposal that I hope can earn the support of both deficit hawks and farm state Members of Congress who support ethanol," said Noem.

Specifically, the proposal would end VEETC early on July 1, 2011, which is currently set to expire at the end of 2011. This would free up approximately $2.5 billion, of which $1.3 billion would go to deficit reduction and $1.2 billion to ethanol infrastructure and incentives for next-generation cellulosic biofuels over the next few years.

"The ethanol industry is maturing. My proposal reflects those changes. The greatest hurdle facing ethanol today is getting the product in front of consumers. That is why we focus federal policy on that specific need. This proposal is part of an "all of the above' American energy approach that supports farmers and helps create jobs across rural America," said Noem.

Rep. Rick Berg (R-ND) and Rep. Aaron Schock (R-IL) will cosponsor the bill.

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