The Renewable Fuels Association (RFA) expressed its strong support for an amendment to the Senate transportation bill offered by Senator Debbie Stabenow (D-Mich.) in a letter to Senate leadership.

Writing to Majority Leader Harry Reid and Minority Leader Mitch McConnell, RFA President and CEO Bob Dinneen wrote, “On behalf of America’s ethanol industry, the Renewable Fuels Association (RFA) is writing to voice our support for the Stabenow amendment (#1812) to the pending transportation bill.  The Stabenow amendment includes three very important tax incentive extensions that will encourage investment in new biofuel technologies and infrastructure that will lower gasoline price and provide consumers choice at the pump.”

Specifically, the Stabenow amendment would provide for the extension of two critical tax incentives for the advanced and cellulosic ethanol industry -- the Cellulosic Biofuels Producer Tax Credit (PTC) and the Accelerated Depreciation Allowance for Cellulosic Biofuel Plant Property – as well as extending the Alternative Fuel Infrastructure Tax Credit that helps gasoline retailers install blender pumps and other ethanol fueling infrastructure.  These policies are vital to the ongoing development of the domestic ethanol industry and commercialization of the advanced and cellulosic ethanol industry. 

The entire RFA letter is as follows:

Dear Majority Leader Reid and Minority Leader McConnell:

On behalf of America’s ethanol industry, the Renewable Fuels Association (RFA) is writing to voice our support for the Stabenow amendment (#1812) to the pending transportation bill.  The Stabenow amendment includes three very important tax incentive extensions that will encourage investment in new biofuel technologies and infrastructure that will lower gasoline price and provide consumers choice at the pump.

Specifically, the Stabenow amendment would provide for the extension of two critical tax incentives for the advanced and cellulosic ethanol industry -- the Cellulosic Biofuels Producer Tax Credit (PTC) and the Accelerated Depreciation Allowance for Cellulosic Biofuel Plant Property – as well as extending the Alternative Fuel Infrastructure Tax Credit that helps gasoline retailers install blender pumps and other ethanol fueling infrastructure.  These policies are vital to the ongoing development of the domestic ethanol industry and commercialization of the advanced and cellulosic ethanol industry. 

The U.S renewable fuels industry is already an American success story.  Domestic ethanol production is helping to employ, either directly or indirectly, more than 400,000 Americans while reducing our dependence on imported by 485 million barrels a year.  

With gas prices soaring, it is increasingly important to diversify U.S. motor fuel markets with viable and competitive alternatives to gasoline, such as ethanol produced from wide range of feedstocks that will offer American consumers a choice at the gas pump.  In fact, ethanol today is helping keep gas prices significantly lower than they otherwise would be.  Ethanol is a cheaper motor fuel than gasoline today and is reducing our dependence on imported oil, thus putting downward pressure of world oil markets.  A study from the University of Wisconsin and Iowa State University concluded that in 2010, the use of 13 billion gallons of ethanol kept gasoline prices $0.89 lower than they otherwise would have been – a savings of some $800 for the average American family.

Yesterday, President Obama laid out an ambitious goal of demonstrating the efficacy of alternative fuels in 10-15 communities across the nation.  Extending the Alternative Fuel Infrastructure Tax Credit would not only help achieve the President and the nation’s goal of increased reliance on domestic alternative fuels, but would build upon the 3,000 gas stations that today offer an ethanol blend above 10 percent. 

Continuing its evolution, the advanced and cellulosic biofuels industry is now in the process of building new plants, helping drive innovation at existing production facilities with emerging technologies, and introducing new product streams that will allow the renewable fuels sector to become more profitable, diversified and efficient.  Over the last several years, the advanced ethanol industry has vastly increased the efficiency and reduced the cost of producing ethanol from new sources of biomass – including but not limited to municipal solid waste, agricultural waste, energy crops and grasses, and sustainably harvested wood resources.

Stable public policy has helped advanced and cellulosic ethanol companies attract several billion dollars in investments.  Much of that money was invested with the expectation that Congress would continue policies that would bring these promising technologies to commercialization.  The PTC and accelerated depreciation allowance provide investment certainty in a high‐risk marketplace largely supply‐ and price‐controlled by OPEC.  Allowing the PTC and accelerated depreciation allowance to expire runs counter to the goals set forth by Congress to foster the development of advanced biofuels under the RFS.

To protect our nation’s energy interests, we ask that you support the Stabenow amendment (#1812).

Sincerely,

Bob Dinneen

President and CEO