Congress plots U.S. energy future

By Jerry W. Kram | October 06, 2008
Energy prices remained high on Congress' list of priorities as the current session winded toward a conclusion. However, the Wall Street financial crisis has delayed consideration of new energy legislation to sometime after Election Day.

With time to consider new legislation shrinking, the House of Representatives approved House Resolution 6899, the Comprehensive American Energy Security and Consumer Protection Act. While mainly focused on oil production, the bill has several titles dealing with alternative energy, including cellulosic ethanol. The bill passed the house in mid-September by a vote of 236 to 189.

Meanwhile, a bipartisan group of 20 senators led by Sens. Kent Conrad, D-N.D., and Saxby Chambliss, R-Ga., launched its own compromise energy bill called the New Energy Reform Act, also known as New ERA, before the financial crisis peaked. In a joint statement, Conrad and Chambliss said, "Unfortunately, with the fiscal crisis unfolding, time to debate a comprehensive energy policy is not available. Instead, we will share our plan with our colleagues and ask that the New ERA bill be among the first orders of business when Congress reconvenes."

The Senate Agriculture Committee has also been active in trying to move ethanol legislation over the past several months. The committee held a field hearing in Omaha, Neb., titled "Food, Feed and Fuel Production." Jeff Lautt, executive vice president of Poet LLC, spoke in favor of the ethanol industry and told senators that the choice between food, feed and fuel was not one or the other. "Food or fuel is not a choice we have to make," he said. "It can be both, and it will be both if we have the will to do so."

Lautt listed five positions that would help support the production of corn- based ethanol and ease the introduction of cellulosic ethanol into the marketplace. First, Congress should allow higher-level ethanol blends for use in automobiles rather than the 10 percent standard now in place. He also called for all new automobiles to be flexible-fuel vehicles (FFVs), saying that the cost of converting existing models to FFVs is minimal and there was no reason to delay it any further. He also called for the installation of blender pumps at filling stations to give consumers access to higher-level ethanol blends, increased funding for research and development of cellulosic ethanol, and the continuation of the tariff on imported ethanol to ensure that U.S.-based solutions will continue to be developed.

Sen. Tom Harkin, D-Iowa, chaired the Omaha hearing and has sponsored several pieces of legislation to aid the ethanol industry in the past. With Sen. Richard Lugar, R-Ind., he introduced legislation aimed at giving ethanol producers access to lower-cost transportation via pipelines by giving pipeline owners the same tax benefits they receive for moving petroleum products. Harkin and Lugar subsequently introduced legislation to expand the availability of FFVs to American consumers by requiring half of all light-duty vehicles manufactured for sale in America to be FFVs by 2011, increasing to 90 percent by 2013. These bills are unlikely to be considered in the waning days of the current Congress but could be incorporated into future legislation when the 111th Congress convenes in January.