Bipartisan, Bicameral Legislation Introduced to Address Ethanol Mandate Concerns
May 26, 2011

Contacts:

Matt Dempsey, Inhofe-EPW 202-224-9797

Kathryn Burns, Snowe 202-224 1304.

Travis Considine, Bilbray 202-641-0548

Frederick Hill, Issa 202-225-0037

Anne Hughes, Moran 202-225-3472

Cole Perryman, Boren 202-225-2701

Bipartisan, Bicameral Legislation Introduced to Address Ethanol Mandate Concerns

Link to Fuel Feedstock Freedom Act 

Washington, D.C.-Sen. James Inhofe (R-OK), Ranking Member on the Senate Committee on Environment and Public Works, along with Senator Olympia Snowe (R-ME), and Congressmen Bilbray (R-CA), Dan Boren (D-OK), Darrell Issa (R-CA), and Jim Moran (D-VA) today introduced bipartisan, bicameral legislation, which allows for a more sensible implementation of corn-ethanol policy while encouraging greater competition in the pursuit of advanced biofuels. The bill, The Fuel Feedstock Freedom Act (S. 1085), gives individual States the option not to participate in the corn ethanol portion of the Renewable Fuel Standard (RFS).  It also expands the cellulosic biofuel carve-out to include algae and any non-ethanol renewable fuel derived from renewable biomass. This new feedstock-neutral definition will encourage the use of renewable feedstocks such as algae, while promoting the production of drop-in fuels, which are both engine friendly and can be readily blended and transported in the nation's existing distribution infrastructure.

Senator Inhofe: "I am pleased to introduce this bill which allows fuel markets to respond to consumer demand for ethanol free gasoline where it exists.  The ethanol portion of the RFS has been a top concern in my home state of Oklahoma: ethanol decreases fuel economy and in some instances can cause engine damage.  This bill provides a common-sense solution.  With strong bipartisan, bicameral support, I hope the Fuel Feedstock Freedom Act will have a good chance of success, and I look forward to joining my colleagues as we work to pass this bill."

Senator Snowe: "While I strongly support cost-effective methods to reduce our dependence on foreign oil, our policies must reflect the practical geographical restrictions of federal corn-ethanol mandates as well as the opportunities for advanced biofuels.  I appreciate Ranking Member Inhofe's leadership in ensuring that the states are also involved in energy decisions that significantly affect fuel consumers throughout the country and I look forward to working with my colleagues to improve the Renewable Fuel Standard by passing this legislation into law."  

Rep. Bilbray: "This bi-partisan bill will allow states to get out from under a crushing federal mandate that pollutes our environment and picks our pockets at the gas pump and grocery store. Rather than government picking winners and losers, this legislation allows our most promising clean fuel technologies of today and tomorrow to participate in the Renewable Fuel Standard."

Rep. Issa: "Taxpayers have paid billions for the federal government's fixation on corn-based energy. And what have we to show for it? Higher prices at the grocery store. This legislation provides states with the flexibility to opt out of government's inefficient, costly ethanol mandate without being penalized. It's a solution long overdue, and its necessity is yet another reminder that the American people, not the federal government, are in the best position to decide which energy solutions work best for them."

Rep. Moran: "The ethanol industry has long benefited from favorable tax treatment, an import tariff and most recently a renewable fuel mandate. The federal government plays a critical role in developing cleaner, alternative sources of energy, but the corn-based ethanol mandate in the 2005 and 2007 energy bills went too far. This bill offers a reasonable state-based option to pull back while promoting the growing field of advanced biofuels."

Rep. Boren: "I am honored to join Senators Inhofe and Snowe, and my colleagues in the U.S. House, to introduce this legislation.  It is a responsible and reasonable solution that provides the states with a greater role in determining how they meet the renewable fuel standard.  I look forward to working with each of them to pass this legislation."

Fuel Feedstock Freedom Act: Section Analysis

Section 1.  Broadens eligibility of the Cellulosic Biofuels Carve Out.  The bill redefines "Cellulosic Biofuels" as "Next Generation Biofuels."  The previously defined "Cellulosic Biofuel" carve out is expanded to include any non-ethanol renewable fuel derived from renewable biomass as well as ethanol derived from algae.  This new feedstock neutral definition maintains the same volumetric and environmental performance requirements as currently applied to cellulosic biofuels.

Section 2. 

Allows State Option of Non-participation.  The bill allows a State the choice to not participate in the corn ethanol portion of the Renewable Fuel Standard mandate.  If a State's legislature passes a bill in which the state elects to not participate in the corn ethanol portion of the RFS, and this bill is signed into law by the Governor, the EPA would then reduce the national volumetric mandate of corn ethanol by the percentage which reflects the national gasoline consumption that is attributable to that State.   This option of non-participation would only apply to the corn portion of the RFS and would not affect any of the volumetric requirements for advanced biofuels.

Generates Credits to Hold Fuel Sales Harmless.  To mitigate disincentives caused by the corn portion of the RFS mandate toward providing clear gasoline in nonparticipating States, this bill allows for the generation of credits to hold harmless the delivery of clear gasoline in nonparticipating States.  The EPA Administrator would provide for the generation of credits for all gasoline (regardless of whether the gasoline is blended) provided through fuel terminals in the nonparticipating State to be calculated as though the gasoline were blended with the maximum allowable ethanol content of gasoline allowed in that State.  These credits would then be available to be applied toward the volumetric requirements of the corn portion of the RFS. 

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