Mr. President, when we talk about moving toward energy independence in this country, we are really speaking to the issue of reducing America's dangerous dependence on imported oil. Our addiction to…
Mr. President, when we talk about moving toward energy independence in this country, we are really speaking to the issue of reducing America's dangerous dependence on imported oil. Our addiction to oil is most acute in the U.S. transportation sector where a stunning ninety-seven percent of our fuel comes from petroleum--97 percent. In the electricity sector we have largely turned away from oil but not so in transportation.
Fortunately a growing percentage of transportation energy is now coming from clean, domestically-produced renewable fuels like ethanol and biodiesel. With the nearly 8-billion-gallon Renewable Fuels Standard now the law of the land, renewable fuels will supply 5 percent of the energy for our passenger vehicles by 2012, perhaps more. These home-grown, environmentally friendly alternatives made from corn, soybeans and other sources of biomass are helping to improve air quality, reduce greenhouse gas emissions and enhance the rural economy while substantially reducing dependence on foreign oil.
The best part of this trend is that the health, community, and domestic security benefits of renewable fuels come with the bonus of price savings at the pump. Ethanol prices in this country can be as much as 70 cents a gallon less than regular gasoline. Drivers in my State of Iowa are saving as much as 10 cents a gallon on E10--a blend of just 10 percent ethanol and 90 percent gasoline. This is a savings of about $100 a year for a typical family.
A report earlier this year by the Consumer Federation of America found that consumers throughout our country would experience similar savings if all refiners offered E10. That is a significant savings in all regions of the country. Now, consider the savings if ethanol and other renewable fuels were blended not at 10 percent, but at 85 percent or more. That $100 a year savings turns into hundreds of dollars each year for a typical family.
Unfortunately, right now only about two percent of vehicles on the road in the United States can use ethanol blends of 85 percent--what we call E85. It turns out standard gasoline engines aren't designed for the different fuel to oxygen ratio.
The good news is, manufacturing a new vehicle to run on E85 or other clean alternative fuel blends is simple--the manufacturer adds a fuel sensor and modifies the engine calibration and fuel line to allow the vehicle to run on gasoline or a combination of gas and alternative fuels.
Right now, these ``flex-fuel'' vehicles cost at most an additional $100 or so to produce. Some cost estimates are as low as $50. Many auto manufacturers offer them to customers at no additional cost. But few Americans are even aware of the option.
At a time of record-high gas prices and continued instability in the Middle East and other oil-producing countries of the world, I believe that all Americans deserve the option to choose the fuel they put in their car.
In Brazil, all new vehicles on the road are expected to be flex-fuel- ready by 2008--meaning every new vehicle owner will have the choice to fill up with gasoline, ethanol, or a combination of the two. If the Brazilians can do it, why can't we?
That's why today Mr. Lugar, Mr. Obama and I are introducing the Fuel Security and Consumer Choice Act to require that automobile manufacturers equip a growing percentage of new vehicles sold in the U.S. for flexible fuel operation. Mr. Lugar is a leader in promoting research and development into the conversion of cellulosic biomass into useable fuels. Mr. Obama is a leader in promoting renewable fuels and in particular E85.
Starting eighteen months after the bill's enactment, manufacturers will be required to equip 10 percent of their cars and light trucks with flex-fuel vehicle, FFV, capability. This is a modest proposal. Several manufacturers are close to meeting or beating this requirement already.
Each model year thereafter, the requirement increases 10 percentage points, so in the second year the manufacturers would have to make at least 20 percent of their vehicles FFVs, and so on, until in about ten years' time 100 percent of new vehicles sold in the United States are flex fuel. I recognize that we could be more aggressive in our timetable, but I believe we've struck the right balance here in pushing and prodding.
In addition, the bill allows auto manufacturers to bank and trade FFV credits toward meeting the requirements. In other words, if one company produced more than its required percentage of FFV vehicles in a given year, it could trade or sell extra credits earned to another company that would then use them to meet the bill's requirements. Credits would have a three-year window if banked or traded. This banking and trading provision is similar to others in law, in the RFS for example, making it that much easier for companies to meet statutory obligations at the lowest possible cost.
Finally, the bill would leave intact the corporate average fuel economy (CAFE) credits for FFV production. However, the bill would change the way the credits are calculated for vehicles produced above the required percentages. Rather than keeping the assumption that the vehicle runs 50 percent of the time on fuel like E85, which isn't an appropriate figure since most don't run yet on E85, we phase-down the assumed use from 50 percent in the first model year the requirement applies to 30 percent in the second year, 10 percent the third year, and 0 percent thereafter. This should still spur interest among automakers in the early years of the requirement to go beyond the minimum FFV production levels outlined in the bill to get the extra credits. And in the meantime the FFV requirement is kicking in and the ramp up of FFVs won't dilute or weaken CAFE.
This bill will give American consumers true choice in fuel selection for the first time. Drivers will have the option to choose low-price, high-performance E85, or another fuel. My firm belief is that consumers will choose to buy home-grown renewable fuels that directly reduce oil dependence rather than buy traditional fossil fuels often derived from unstable regimes around the globe.
Now, I don't doubt some automobile manufacturers will complain that this requirement is unduly onerous, that it will hurt the industry somehow. Well, I heard the same thing back in 1989 when I proposed another revolutionary idea: closed captioning for TV sets. Industry was in an uproar when I suggested that the hearing impaired should have access to television programming on the public airwaves. The industry said closed captioning would bankrupt it and drive the price of televisions through the roof.
But then, an amazing thing happened. Electronics manufacturers realized that they could reach a broad range of new audiences, including not just the hearing impaired, but also the learning disabled, and immigrants for whom English is a second language. Sales for several companies reached an all-time high, and with implementation across the electronics industry, the cost of the closed captioning chip dropped dramatically to less than a dollar a set.
I have no doubt that vehicle manufacturers will discover similar unexpected efficiencies and benefits with flex fuel vehicles. As more Americans discover the savings from flexible fuels, the more they will seek them out. What better way to boost car sales than to market the fuel cost savings that flexible fuel vehicles offer? Any very small additional cost of the flex-fuel vehicle will be more than offset by the price benefits drivers will achieve from a flexible fuel supply over time, not to mention the tremendous energy security benefits for our Nation.
The country will benefit from cleaner air, reduced greenhouse gas emissions, reduced dependence on foreign oil, and an enhanced rural economy. Simply, put, this is a low-cost measure with a tremendous payoff.
It is already well-established that federal auto standards for the benefit of our Nation are an appropriate policy option. It's also important to note that auto manufacturers already comply
with literally dozens of other requirements having to do with the make- up, design, and performance of their vehicles. Making an FFV is a lot cheaper than putting in air bags, or many other components.
Agriculture and renewable fuels producers are ready to provide the fuel. Automobile manufacturers have the technology to do it. Given the country's great energy and security challenges, all sectors must do their part to chart a path toward energy independence: government, individual citizens, energy companies, and yes, auto manufacturers.
I'm grateful that this legislation has been endorsed by a wide array of renewable fuel, agriculture, clean energy and security organizations, including the Renewable Fuels Association, American Coalition for Ethanol, Alliance to Save Energy, Set America Free, and National Corn Growers Association.
In closing I want to recognize Mr. Lugar and Mr. Obama for co- sponsoring this legislation with me today. Mr. Lugar and I have teamed up many times over the years, most recently to enact the national Renewable Fuels Standard, which we did as part of the comprehensive energy bill. This bill builds upon the RFS, to guarantee that renewable fuels which are being produced in ever greater abundance can find a home in just about any vehicle on the market a few short years from now. I am thankful for his leadership on this and so many other important energy security issues. I am also grateful to Mr. Obama for his leadership.
I hope we can rapidly enact this legislation.
Mr. President, today, I am introducing the School Energy Crisis Relief Act. This bill would authorize the Secretary of Energy to award School Energy Grants to the poorest school districts in each State. I am pleased that Senators Schumer, Clinton, and Bingaman have joined me in sponsoring this bill.
With cold weather setting in, people all across the country are worried about the sky-high cost of energy. Americans are feeling pain at the pump, and they are feeling even more pain at home, with home- heating costs expected to rise as much as 70 percent above last year's levels.
At the same time, many public school districts across the country are struggling to cope with a dramatic, unexpected surge in their energy costs. Schools are facing a double hit: they operate large fleets of buses, and they must heat large, sprawling buildings. This problem is especially acute in the West and Midwest, where many school districts cover large geographic areas, and in urban areas, which are burdened with some of the nation's oldest and often least energy-efficient buildings.
For affluent suburban districts, these unanticipated energy costs are a challenge. But for poor school districts, they are a full-blown crisis. Many school boards face a choice between paying their higher energy bills or cutting instructional staff and programs.
My bill would allow the Secretary of Energy to award grants to schools districts with the highest percentage and highest number of students eligible for Title I assistance. The grant amounts would be awarded based on the population of school-age children in the district, as well as the regional costs of transportation and heating fuel.
This is a nationwide crisis, and it calls for an urgent Federal response. School districts across the country are already implementing drastic measures in response to higher energy costs. In Kentucky, for instance, several school districts have cut back to four days of classes per week. In September, most of Georgia's schools cancelled classes for two days in an effort to conserve energy and cut costs.
In my State, the Iowa Association of School Boards estimates that, this winter, there will be $40 million shortfall in funding to cover school heating costs. Higher fuel costs for school buses could worsen the shortfall by another $8 million. And because that will come out of the fixed general fund for public education, every additional dollar spent on energy costs will come at the expense of classroom and instructional quality. For example, Charles City, IA, expects to spend $140,000 more on fuel this winter. That's enough to pay the salaries of four teachers.
According to the Iowa Association of School Boards, school districts are responding to the energy crisis by reducing staff, increasing class sizes, reducing course offerings, postponing technology purchases, or cutting Headstart transportation programs. Many school districts are lowering their thermostats to unhealthful levels. In fact, just yesterday, I heard that the school district in Ottumwa, IA, has asked parents to start sending kids to school with coats to keep them warm indoors. This is just not acceptable.
In addition, I remind my colleagues that school districts--especially high-poverty school districts--are struggling heroically to try to meet the requirements of the No Child Left Behind Act. It is penny wise and pound foolish to force these districts to cut instructional staff and classroom resources in order to pay their higher energy bills. And none of us can be comfortable with the prospect of children sitting at their school desks in coats and scarves to fight off the chill. As I said, this is just not acceptable.
The poorest school districts all across America are in desperate need of assistance with their energy costs. Low-income children deserve the opportunity to learn and achieve in classrooms that are properly heated. And we certainly don't want schools to be eliminating school days and laying off teachers because of higher energy costs. So we need to act. I urge my colleagues to support the School Energy Crisis Relief Act so we can respond to this emergency as expeditiously as possible. According to the Iowa Association of School Boards, this has led to some schools deciding to scale back after-school activities because of heating costs and to cut non-varsity sports because they lack funding necessary to take them to games. It is very troubling to me that schools have been forced to make cuts that have directly affected the educational experience of the children in their schools, in the name of rising fuel costs. For instance, some schools have had to cut back on field trips, put off buying new text books and school supplies, while reducing course offerings in fine arts and academics.
In addition, the Iowa Association of School Boards has reported that schools have cut back on staff and increased class sizes while also turning down the thermostat in the classroom. I ask, Mr. President, are we supposed to expect students to learn at a high-level when rising energy costs have put them in overcrowded, cold classrooms?
But this problem is not specific to my home State of Iowa. As the sponsor of companion legislation in the House of Representatives, Congressman Joe Baca, pointed out that some schools in Kentucky have cut back to four-day school weeks to keep their energy costs down. Recently, Georgia schools cancelled two days of classes in an attempt to keep their costs down. In Colton Joint Unified District in Congressman Baca's congressional district, the price of a gallon of diesel fuel has risen from under a dollar at one point to $2.72 a gallon increasing annual fuel costs by over $300,000.
So I have come to the floor today to introduce the School Energy Crisis Relief Act. This legislation meets the needs of struggling school districts by authorizing the Secretary of Energy to award grants to poor school districts struggling to balance skyrocketing energy costs with providing a quality education. Grants would be awarded to the poorest urban and rural school districts in each state. In Iowa alone, this means both poor rural and urban districts would be eligible to receive grants.
I ask for my colleagues support for the School Energy Crisis Relief Act and urge the Senate to work quickly to pass this crucial legislation and provide relief to those school districts in need.
