Stuck in a Foreign Oil Barrel

Published in CSP Daily News

Mich. Dems offer ethanol legislation package

LANSING, Mich. -- Michigan House Democrats yesterday unveiled a multi-bill legislative package aimed at driving down the cost of diesel fuel and gasoline by decreasing U.S. dependence on foreign fuel.

They were scheduled Tuesday to lay out the details of their six-bill package at news conferences in Lansing, Bay City, Port Huron and Petoskey, Mich.

We need to take serious steps to relieve the pain at the pump we're all feeling, said State Representative John Espinoza (D), a lead sponsor of the legislation. We're in the middle [image-nocss] of the biggest run-up in oil and gasoline prices we've ever seen. It's time to take action to address the problem and ensure our long-term energy needs are met.

State Rep. Gary McDowell (D), another leader in the effort to find long-range solutions to rising gasoline prices, expressed concern over the toll higher prices are taking on small businesses and the overall economy. Relying on foreign oil is bad for consumers, bad for the environment and bad for our wallets, he said. Right now, consumers are stuck in a foreign oil barrel, and we're heading over the edge of the falls. We need to develop the fuels of the future right here in Michigan.


The multi-bill legislative package includes:

Giving tax credits for gas retailers and blenders who purchase special equipment for biodiesel and ethanol products to encourage investment in the fuels of the future. Promoting the use of alternative fuels by encouraging the state fleet to use biodiesel fuel, E-85 vehiclesthose with an 85% blendor American-made hybrids and encouraging local governments to do the same. Creating a commission to promote the research and use of ethanol, biodiesel and other renewable fuels. Requiring that all gasoline sold in Michigan consists of 10% ethanol. Establishing a B55% biodieselrequirement for diesel fuel, effective Dec. 31, 2006.

State Rep. Jeff Mayes, a ranking Democrat on the House Committee on Agriculture, highlighted the many benefits of alternative fuels across various sectors of the economy: Decreasing our dependence on foreign oil with ethanol and biodiesels is a surefire way to create jobs, fuel economic prosperity in our agriculture community and bring price relief at the pump. It's also better for our air, land and water.

Promoting the production of alternative fuels also has additional economic benefits for Michigan farmers, they said. Biodiesel is made from soybeans and ethanol is made from corn, both major agricultural commodities in the state. A third source of energy that is also produced in Michigan is sugar, which can be converted to an alcohol-based fuel blend that is more efficient and more environmentally friendly, they said.

Three Michigan companies already are planning to build biodiesel plants, and 40% of corn grown in the Thumb goes to an ethanol plant in Caro.

State Rep. Dudley Spade (D), who also is sponsoring a bill in the package, predicted the legislation, if passed, will lead to more Michigan jobs by opening doors of opportunity in emerging fields. These fields include using existing technology to produce and use more biodiesel and ethanol, the development of technology to allow vehicles to use a higher percentage of biofuels and the exploration of alternative fuel options such as fuel cells. With our auto manufacturing expertise and sizable agricultural economy, Michigan is a natural place to expand fuel options for existing and future vehicles, he said. We can and should be the world leader in developing alternative and renewable energy sources.

State Rep. Kathleen Law (D), a research scientist and long-time advocate for renewable fuels, said, Developing the homegrown fuels of the future will create jobs, clean the environment and help break our dependence on foreign oil.

Under their proposal, Michigan in 2007 would join two statesMinnesota and Montanathat require much of the gasoline sold within their borders to include 10% ethanol, said Dan Farough, spokesperson for House Democrats, according to an Associated Press report. Hawaii will have a similar requirement in 2006, he said.

Two gas stations in Michiganin Dimondale and Rochester Hillssell fuel that is 85% ethanol and 15% gasoline, or E85, according to the National Ethanol Vehicle Coalition ( www.e85fuel.com) website. The number of stations offering alternative fuel could grow in the coming years because three Michigan companies are planning to build biodiesel plants, Farough said.

Democrats also want to promote the use of alternative fuel vehicles by encouraging Governor Jennifer Granholm to use E85 fuel or hybridspowered by gasoline and electricitymade by American auto companies in the state's fleet of vehicles.

Jason Brewer, a spokesperson for Republican House Speaker Craig DeRoche, said the speaker will review the Democratic bills when they are officially introduced. He pointed out that State Rep. Neal Nitz (R) already has introduced legislation that would require diesel fuel sold in the state to have at least 2% biodiesel.

Brewer criticized House Democrats for introducing the alternative fuel package after voting in June to close loopholes in the tax structure that now limit taxes on low-producing oil wells and change the way oil and gas royalty incomes are taxed. The changes were not approved by the full House, where Republicans have a 58 to 52 majority. The Democrats' proposal might seem more credible if they had not voted to increase taxes on domestic energy producers by $7 million, Brewer said.