Statements On Introduced Bills And Joint Resolutions

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - January 18, 2007)

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By Mr. THUNE (for himself, Mr. SALAZAR, and Mr. HAGEL):

S. 331. A bill to provide grants from moneys collected from violations of the corporate average fuel economy program to be used to expand infrastructure necessary to increase the availability of alternative fuels; to the Committee on Energy and Natural Resources.

Mr. THUNE. Mr. President, I rise today along with my colleague from Colorado, Senator Salazar, regarding S. 331, the Alternative Energy Refueling Systems Act of 2007. The bill is a very straightforward measure that seeks to increase the number of alternative refueling stations across our country, something that I hope the full Senate will support later this year.

Today, there are over 9 million alternative fuel automobiles on the road in America. However, while automakers have pledged to produce an increasing number of these vehicles, there is a serious shortfall in the number of gas stations to support these vehicles. For instance, while there are more than 6 million flex-fuel vehicles on the road today which can run on E-85 or gasoline, less than 1 percent of all gas stations in this country offer E-85 fuel. Clearly, more must be done to increase the availability of alternative fuels at the retail level.

The Alternative Energy Refueling Systems Act would authorize the Department of Energy, through the existing Clean Cities Program, to provide grants to gas station owners who will install alternative refueling systems. These grants would greatly assist in expanding the availability of alternative fuels such as E-85, which is a mix of 15 percent gasoline and 85 percent ethanol, or biodiesel, natural gas, compressed natural gas, hydrogen, or liquefied petroleum gas.

Under this legislation, gas station owners who wish to install a new alternative fuel tank would be reimbursed for up to 30 percent of the cost, not exceeding $30,000, of expenses related to the purchase and installation of a new alternative refueling system. Keep in mind that subject to an annual appropriations, funding for these grants would come from a portion of the penalties that are collected annually from auto manufacturers who violate the Corporate Average Fuel Economy, or CAFE standards, most of which are foreign automakers.

I have to say the cost to install a pump like this generally runs somewhere from $30,000 to $40,000 to about $200,000, depending on where you are in the country. So obviously, it is a big investment for a lot of these filling station owners. But the fact is, they need to have an incentive and some assistance to make sure we are closing the gap that exists in this country between the production of renewable energy--a lot of ethanol production is going on in the country. In my State alone we have 11 plants currently operating, 5 more under construction, and we will be, by 2008, at 1 billion gallons annually of ethanol in South Dakota alone. So when you add to that the ethanol that is produced in other areas of the Midwest, we have a lot of production out there, and I think we have a big market growing. We have a renewable fuels standard that requires that we use 7.5 billion gallons annually by the year 2012, which, frankly, I think we will eclipse way before that time. Because at the current rate of production, we are going to blow by that in a very short time.

But that being said, there is a requirement out there that a market develop for this. We have a lot of consumers around the country who would like to have access to renewable energy who believe for a lot of reasons, as I do, that it makes sense to lessen our dependence upon foreign sources of energy, to become more energy secure. It cleans up the environment and, obviously, in my part of the country, it is very good for American agriculture. But what we are missing in that distribution system is the retail level. We have the production, we have the demand, we have a renewable fuels standard, we have a market, but we don't have a way of joining those. Because of the costs associated with installing some of these pumps, a lot of filling station owners are reluctant to do so. What this would do is provide up to $30,000 or 30 percent of the cost not to exceed $30,000 toward that end. So we think this is a very commonsense approach to doing something that we really need to be doing in America today, and that is moving away from our dependence upon the oil industry for our energy.

I wanted to tell my colleagues a little bit about who supports this piece of legislation. We have a number of businesses, agricultural and alternative energy groups, including General Motors, Ford Motors, Daimler Chrysler--all the big domestic automakers--Wal-Mart, the Petroleum Marketers Association of America, the National Ethanol Vehicle Coalition, the National Association of Fleet Administrators, the Renewable Fuels Association, the National Biodiesel Board, the National Corn Growers Association, the American Soybean Association, the American Coalition for Ethanol, and the National Association of Truck Stop Operators.

So up and down the so-called food chain, from the production, the corn growers, the manufacturers of vehicles in this country, those who are involved at the retail level with getting fuel out there--filling stations, convenience stores--all the agricultural organizations, as I said, the ethanol industry, are all very much supportive of this particular piece of legislation.

A measure very similar to this overwhelmingly passed in the House of Representatives by a vote of 355 to 9 back on July 4 of 2006. Unfortunately, the Senate was unable to consider our companion measure before adjourning last year.

So Senator Salazar and I wholeheartedly believe this is a commonsense measure that will significantly increase the number of alternative refueling stations nationwide. As I said earlier, it accomplishes a lot of objectives that are important from a policy standpoint, a national security standpoint, energy security standpoint, and an environmental standpoint. This, to me, is a win-win, and I hope the Senate will act on it before this year is out. Hopefully, we will start to consider very seriously in the weeks and months ahead energy legislation and another farm bill, which I hope will have a very robust energy title included in it. It is high time we did something substantial to lessen or to close this gap we have and this problem that needs to be addressed in terms of our ability to continue to grow the renewable fuels industry in this country, home-grown energy, energy that we get on an annual basis.

We raise a corn crop every year in South Dakota, as they do in Iowa, Minnesota, and Nebraska and in other States across this country which are all starting to realize the benefits of ethanol production and what it means to their agricultural economy. So this is a good piece of legislation that makes sense in so many ways. I hope the very clear logic of it will help us prevail in getting it passed in the Senate this year.

This legislation is cosponsored by Senator Hagel of Nebraska and Senator Conrad of North Dakota. I again put this bill before the Senate, and I look forward to its consideration.

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