Mr. President, I thank the Chair for giving me this brief opportunity to speak about the renewable fuels provisions in the Energy bill. I thank my colleagues, Senators Frist and Reid, for their leadership, and Senators Lugar, Harkin,…
Mr. President, I thank the Chair for giving me this brief opportunity to speak about the renewable fuels provisions in the Energy bill. I thank my colleagues, Senators Frist and Reid, for their leadership, and Senators Lugar, Harkin, Talent, and so many others for their efforts in developing this important legislation.
I am here today to support the renewable fuels provision in the Senate Energy bill. This legislation is one of the pillars for economic development for rural America, one segment of the population that lagged behind in the economic surge of the 1990s, yet a segment positioned to play such an integral role in fueling our Nation.
It is rare when legislation benefits all. It is rare when legislation creates only winners. It is clear that the production and use of renewable fuels is a win/win situation--a win for farmers from rural communities, a win for consumers, and a win for the environment. That is why as Governor of Nebraska, I invited other Governors interested in creating a group devoted to the promotion and increased use of ethanol to join me in Nebraska. In September of 1991, we met, and the Governors' Ethanol Coalition emerged. Membership in the coalition doubled from 9 to 19 States during the first year, and now stands at 30 States, with international representatives from Brazil, Canada, Mexico, Sweden, and Thailand--30 States, red and blue States.
First, I mentioned this legislation is a win for farmers in rural communities. Three years ago, we completed the farm bill which at the time was characterized as one very important part of the economic revitalization plan for rural America. Economic stimulus can come in many forms and the production of renewable fuels is certainly a viable option for rural America, especially--and candidly--in my State of Nebraska.
It is as simple as this: Demand for corn to create ethanol raises prices for corn. Demand for sorghum to create ethanol raises prices for sorghum. Demand for soybeans to create biodiesel raises prices for soybeans. Added to the important feature of farm profitability is the idea that increased grain prices result in less assistance to producers under the farm bill in the form of loan deficiency payments and countercyclical payments--yes, less government assistance. Merging the realities of agricultural economics and farm policy into energy legislation is the type of responsible legislation the voters sent us here to enact.
I am unabashedly proud of what my home State has accomplished in this area. Within the State of Nebraska, 11 ethanol plants currently produce 523 million gallons of ethanol per year or 12 percent of the Nation's total. The benefits of the ethanol program in Nebraska don't just involve grain producers. It involves investment in industry, the creation of jobs related to plant construction, operation, and maintenance. It includes permanent jobs at the ethanol facilities and stimulates the economic engines in small rural communities. In Nebraska alone, more than 270 million bushels of corn and grain sorghum is processed at the plants annually. These economic benefits and others have increased each year during the past decade due to plant expansion, employment increases, and additional capital investment.
Next, a win for consumers: A study released by the Consumer Federation of America points out that motorists could be saving as much as 8 cents per gallon of gasoline at the pump if oil refiners would blend more ethanol into their gasoline supplies.
I ask unanimous consent to print in the Record a copy of the Consumer Federation of America Report.
The recent decline in ethanol prices, coupled with surging pump prices for gasoline, have created a market dynamic in which increased ethanol use could help curtail record high gas prices. Consumers in many parts of the country where ethanol can be delivered to existing storage and terminal facilities are not receiving lower cost supplies and are paying as much as 8 cents a gallon more at the pump than they would if oil refiners purchased ethanol to blend. Blending high-priced gasoline with more modestly priced ethanol results in a more affordable final product. By using ethanol, oil refiners have an opportunity to pass along real savings to consumers during this period of high gasoline prices.
The Consumer Federation of America cites several reasons for the dramatic increase in gasoline prices, including tight crude oil inventories, inadequate oil refinery capacity, lack of competition, and the oil industry's increasing market power. In contrast to gasoline prices, ethanol prices have actually fallen during the past 6 months.
As an example, the price of ethanol on the Chicago spot market hit $1.82 per gallon in November 2004 but averaged about $1.18 per gallon last month. At these prices, why don't oil companies blend more ethanol to lower consumer prices? We have an opportunity to see that consumers benefit from cleaner burning, affordable, and domestically produced fuel.
Finally, a win for the environment: For environmental and health concerns, the Nation decided to clean up the fuels which have powered America for nearly a century. The Clean Air Act identified numerous areas of the country which must reduce or eliminate their pollution levels. Those areas have been meeting the challenges of the Clean Air Act through changing the gasoline and diesel fuels used, either year- round or seasonally. Studies show ethanol reduces emissions of carbon monoxide and hydrocarbons by 20 percent, and particulates by 40 percent in 1990 and newer vehicles. In 2001 alone, ethanol reportedly reduced greenhouse gas emissions by 3.6 million tons or the equivalent of removing more than 520,000 vehicles from the road.
Now and through the next several years, cleaner and cleaner fuels such as ethanol, natural gas, propane, and biodiesel will be used in cars, trucks, and buses. Today's key issue is to determine which alternatives will extend or replace gasoline and diesel fuel to reduce pollution.
We need to be working hard to craft a comprehensive rural development plan that will spur investment in agribusiness and promote economic activity in the agricultural sector. This Energy bill, and the renewable fuels standard contained within, is an important part of such a rural development plan and is key to reversing the realities of outmigration in the rural areas.
If passed, this fuels language will establish a 4.0-billion-gallon renewable fuels standard in 2006, growing every year until it reaches 8 billion gallons by 2012. This is a responsible approach to meeting the demands of an ever-increasing demand for fuel sources. Additional benefits to this legislation include the displacement of foreign supplies of crude oil, reduction in the U.S. trade deficit, and the creation of tens of thousands of jobs throughout the United States.
It is quite apparent that increased use of ethanol will do much to boost a struggling U.S. agricultural economy and at the same time will help establish a more sound national energy policy.
A choice for renewable fuels is a choice for America, its energy consumers, its farmers, and its environment. It will help us to reverse our 100-year-old reliance on fossil fuels, a more pressing concern than ever given the unrest in the Middle East and increased competition for energy from growing economies throughout the world.
If each State were to produce 10 percent of its own domestic renewable fuel as Nebraska does, America will have turned the corner away from dependence on foreign sources of energy. When you take a hard look at the facts, you will see that this legislation is nothing but beneficial for America.
The Fuels Security Act is balanced, comprehensive, and is the result of the dedication of so many, especially Senator Lugar and Senator Harkin.
Now I ask my colleagues to join me in promoting new opportunities for the technologies that will put our Nation and our world's transportation fuels on solid, sustainable, environmentally enhancing ground. We owe it to our country now and to future generations to pass this legislation.
Mr. President, I yield the floor and I suggest the absence of a quorum.