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Lugar Rural Energy Amendment Passed by Senate Agriculture Committee

Press Release

Location: Washington, DC

Sen. Dick Lugar (R-IN) commended Agricultural Committee adoption of the rural energy amendment he offered with Senator Kent Conrad (D-ND) in today's farm bill markup.

"Rural energy means more jobs and more income for Hoosiers, and it means more energy security for all Americans," Lugar said. "Rural Americans take pride in the contribution they are making to improved national security through domestic energy production."

"Private investment in biomass and renewable energy boosts farm income while also bringing new hope for economic development and increased tax bases for rural communities. It is better to invest at home than to continue to send roughly a billion dollars per day overseas to pay for foreign oil."

The Conrad-Lugar Amendment, which passed by voice vote, included legislation authored by Lugar to enable rural families, farms, and small businesses to save money on their energy bills. That bill, the Rural Energy Savings Program Act (RESPA) offered with Senator Jeff Merkley (D-OR), is backed by the Indiana Statewide Association of Rural Electric Cooperatives.

"Farm Bill energy programs focus on next generation research, development, and demonstration of technologies and practices to enable private investment in rural America," Lugar said. "They also serve an important education component to show farmers and ranchers how today's technologies can save money in their areas."

The Conrad-Lugar Amendment was fully paid for through spending reductions in the farm bill, and it included four critical policy improvements (listed below). The final amendment was based on Conrad-Lugar text co-sponsored by Senators Harkin (D-IA), Thune (R-SD), Nelson(D-NE), Hoeven (R-ND), Bennet (D-CO), Grassley (R-IA), Brown (D-OH), Klobuchar (D-MN), and Casey (D-PA).

Summary of the Conrad-Lugar Amendment:

Provided $800 million over 5 years in funding for rural energy, which was fully paid for by reductions elsewhere in the bill:

9002 Biobased Markets, $3 million per year.
9003 Biorefinery Assistance, $100m in 2013, $58m in 2014, and $58m in 2015.
9006 Biodiesel Education, $1m per year.
9007 Rural Energy for America Program, $48.2m per year.
9008 Biomass Research and Development, $26m per year.
9011 Biomass Crop Assistance, $38.6m per year (of which no more than 50% can be used for "CHST" purposes).

Policy Improvements:

Authorized the Rural Energy Savings Program to allow rural electric cooperatives to provide customers with low-interest loans for energy efficiency upgrades, to be paid back on monthly electric bills. (Merkley-Lugar S.2216)
Includes a Lugar-authored definition of "biobased manufacturing" to increase oversight of the Section 9003 Biorefinery Assistance Program, and places a cap of $25m on the share of funding available for those purposes.
Revised the Biomass Crop Assistance Program to improve functionality and reduce cost. These changes reflect improved regulations at the USDA, codifying "Project Area" and putting limitations on funding through Collection, Storage, Harvest, and Transportation (CHST).
Improved the Rural Energy for America Program (REAP) by removing requirements that farmers install a second meter for onsite power generation to save costs to farmers.

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