Moving the Ethanol Industry Forward
Moving the Ethanol Industry Forward. I’m Greg Martin with today’s Line On Agriculture.
The ethanol industry has been under fire recently. An amendment by Senator Tom Coburn to immediately eliminate the Volumetric Ethanol Excise Tax Credit was stopped from moving to a final vote in the Senate on Tuesday by a vote of 40 to 59. Renewable Fuels Association President and CEO Bob Dinneen believes that the Senate is interested in a more rational transition for ethanol policy to assure continued evolution of the industry.
DINNEEN: That indeed has been tee’d up with a commitment by the majority leader for a vote on Coburn again in a couple of weeks and a vote on an alternative and that’s what we’ve been angling for all year so we welcome this opportunity.
The industry is supporting the alternative proposed this week by two Senators. The Ethanol Reform and Deficit Reduction Act would still end the tax incentive this year while at the same time helping the industry move forward. Dinneen says the legislation would provide tax incentives for infrastructure - such as blender pumps - and for cellulosic biofuels development as well as a variable safety-net determined by the price of oil.
DINNEEN: It’s a fiscally responsible approach that would recognize that at $100 a barrel oil you don’t need the taxpayer to provide an additional incentive to a gasoline marketer to blend ethanol into his gasoline when the marketplace is already providing incentive enough. But would also recognize that if we’re looking at $40 a barrel oil or $50 a barrel oil, let’s make sure that gasoline marketer can continue to offer domestic renewable fuels cost effectively. It’s a type of thing that I think is very fiscally responsible and makes sense as an insurance that the investment that the taxpayer has already made in this industry is protected.
Dinneen says - unlike other industries - the ethanol industry is being proactive in the effort to reduce the federal deficit.
DINNEEN: The ethanol industry, I am proud to say, has been responsible. We’ve stepped up and we’ve said we recognize that the market has changed, we recognize that the industry has grown. We recognize that the public policy has evolved and we can indeed; we should take a look at these policies and revamp them to reflect current realities. I would challenge again any other energy industry to do the same because the nations fiscal situation is such that we all need to be at the table.
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