Congress is Back – What You Should Know
With August recess in the rearview mirror and last bit of sand tumbling from our flip-flops, we’re all turning our attention away from sunny beaches and back to Washington. The ethanol debate has seen its fair share of twists and turns over the past year, and it’s okay if you missed some of them during vacation. So, to prepare for the final legislative push of 2011, here’s a quick recap of everything you need to know.
With August recess in the rearview mirror and last bit of sand tumbling from our flip-flops, we’re all turning our attention away from sunny beaches and back to Washington. The ethanol debate has seen its fair share of twists and turns over the past year, and it’s okay if you missed some of them during vacation. So, to prepare for the final legislative push of 2011, here’s a quick recap of everything you need to know.
Three Key Milestones
1. Senate Says “No More” – On June 16th the Senate passed an amendment by an overwhelming margin of 73 - 27 to end the ethanol tax credit and import tariff established in 1980. This bi-partisan vote sent a strong signal that it’s time to reform U.S. ethanol policy and develop a global market for clean energy.
2. Ethanol Producers Say “We Don’t Need It” – After 30 years of government support, even experts within the industry agree that ethanol producers are prepared for life without the subsidies. Here’s what some of them are saying:
- On the survival of the subsidies in a blog post entitled VEETC is Dead. Get Over It: “[It] will take more than a miracle – it will take someone who actually wants to renew it. And, frankly, no one does at this point.” (Ken Colombini, Director of Communications for the National Corn Growers Association)
- "The industry is preparing for the elimination of the ethanol tax incentive in 2012… The market has changed; we will be just fine without it." (Bob Dinneen, President and CEO of the Renewable Fuels Association)
- “If the credit would have been eliminated, for example, 15 years ago, it would have been a death blow to the ethanol industry. Today, that's not the case.” (Brian Jennings, Executive Vice President for the Sioux Falls-based American Coalition for Ethanol)
- Directly referencing the tax credit: "The industry wouldn't have happened without it, but we're in a different position today." (Tom Buis, President of Growth Energy)
- "We believe that the [ethanol] industry can stand on its own." Later noted the tax credit was “a target on our back since the beginning of this company. We feel like we can be competitive with gasoline going forward." (Todd Becker, CEO of Omaha-based Green Plains Renewable Energy — the country's fourth-largest ethanol producer)
3. Ethanol Left Out of Debt Deal – During the heat of the debate over the debt limit crisis, a bipartisan trio of Senators unveiled a compromise plan that would have ended the ethanol tax credit and import tariff mid-year, applied most of the $2 billion saved to deficit reduction and directed the remaining funds to support advanced biofuels and alternative fueling infrastructure. Senator’s Diane Feinstein (D-CA), Amy Klobuchar (D-MN) and John Tune (R-SD) worked tirelessly to build their compromise into the final debt limit agreement. In the end, however, the compromise was left out of the final plan. Senator Feinstein concluded, "I feel terrible because I think it was a good agreement and should have been enacted."
The Endgame
The general sentiment around the country and on Capitol Hill is that time and interest are running thin for any legislation action to extend the tax credit or the tariff beyond their December 31st, 2011 expiration date. And while this is the best chance in 30 years to eliminate these unnecessary subsidies, there's still work to be done to secure victory with this important initiative.
Brazil ended government subsidies for ethanol more than a decade ago and eliminated its ethanol tariff early last year. It’s time for America to do the same. UNICA believes that everyone wins in an open market because renewable fuels will be produced at a higher quality and lower cost when businesses are allowed to compete.
But to make it a reality, we need your help! Congress still needs to hear from clean energy advocates like you. Tell them stay the course for these last four months and let the unfair and unnecessary subsidies expire on December 31st, 2011. The time has come to end the $6 billion annual taxpayer handouts and lower fuel prices giving us access to cleaner, more affordable renewable fuels like sugarcane ethanol.
