[Congressional Record Volume 152, Number 60 (Tuesday, May 16, 2006)]
[Senate]
[Pages S4625-S4626]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HARKIN (for himself, Mr. Lugar, Mr. Johnson, Mr. Dorgan, 
        and Mr. Biden):
  S. 2817. A bill to promote renewable fuel and energy security of the 
United States, and for other purposes; to the Committee on Commerce, 
Science, and Transportation.
  Mr. HARKIN. Mr. President, high prices for gasoline, diesel fuel and 
other petroleum-based energy continue to cause pain for millions of 
people, in Iowa and all across the country. Our dependence on foreign 
oil is a clear and present danger to our national security.
  If we are serious about national security, we need a bold national 
commitment to renewable energy--a commitment on par with the Apollo 
moon-shot program in the 1960s. Today, I am pleased to be joined by my 
colleague from Indiana, Senator Lugar in proposing a major component of 
such a program--the Biofuels Security Act--a comprehensive plan to 
ramp-up ethanol and biodiesel production, and to make it available and 
usable at the pump in every State in America.
  Perhaps Senator Lugar said it best earlier this year when he 
commented that energy is the albatross around the neck of U.S. national 
security. The distinguished senior Senator from Indiana has been a 
thoughtful, prescient thinker about the national security implications 
of our addiction to foreign oil, and I am delighted to be joining with 
him, today.
  Senators Johnson, Dorgan and Biden are also original cosponsors of 
this legislation, for which I am grateful. The Senators have been 
outspoken champions of biofuels for many years now, and strong 
advocates for their home States.
  The goal of this legislation is to help restore America's energy 
security--which, in this day and age, is synonymous with national 
security. Transportation fuels, accounting for two-thirds of our oil 
imports, are the place to start this transition.
  Our plan has three key components. First, we are proposing a 
substantially higher, but achievable, renewable fuels standard or RFS, 
requiring that our Nation blend into the gasoline supply 10 billion 
gallons of renewable fuel annually by the year 2010, 30 billion gallons 
of renewable fuel annually by the year 2020 and 60 billion gallons 
annually in the year 2030. The current RFS is 7.5 billion gallons of 
renewable fuels in 2012. At the time we enacted the present RFS in last 
year's energy bill, many of us believed this was a reasonably ambitious 
schedule. However, it is now evident that biofuels growth will outpace 
this figure within the next couple of years--well in advance of the 
2012 target date. This is very good news.
  Second, our plan would make E85--the blend of gasoline and 85 percent 
ethanol--available at gas stations all across America. Major oil 
companies would be required to increase the number of E85 pumps at 
their stations by 5 percentage points annually. Within a decade, 
approximately 25 percent of gas stations nationwide would be required 
to have E85 pumps.
  The major oil companies have the financial wherewithal--and the 
ability--to provide E85 infrastructure at a growing percentage of 
gasoline stations over the next decade. This is a reasonable, 
responsible reinvestment of a fraction of their recent earnings in the 
many billions of dollars. The bottom line is that our domestic oil 
companies have a shared responsibility to help enhance our energy 
security, and this is one excellent way for them to contribute.
  Third, our plan would make flex-fuel vehicles nearly universal in the 
United States. Automakers would be required to increase the production 
of flex-fuel vehicles--capable of using both gasoline and 85 percent 
ethanol blends--by 10 percentage points annually, until nearly all new 
vehicles sold in the U.S. are flex-fuel within a decade. Our 
legislation calls for all of the auto manufacturers to produce 
increasing numbers of FFVs, rising to 100 percent of vehicles 10,000 
pounds or less over the next decade. This is eminently achievable, and 
probably easy enough to do much sooner than that.
  Recent estimates for the extra cost of manufacturing an FFV are as 
low as $30. It is a matter of modifying the engine, fuel line and 
adding a fuel sensor, which most vehicles have anyway. That is less 
expensive than many other federal requirements for the auto industry. 
Air bags are more expensive, for instance. And the bottom line is FFVs 
are being sold for the same price as regular cars.
  America's dependence on foreign oil is the source of so many of our 
problems, today. We are transferring vast amounts of wealth to regimes 
that are not friendly to our interests. We are vulnerable to price 
hikes and embargoes. Millions of petrodollars are finding their way 
into the hands of terrorists and other extremists. And we are 
accelerating the pace of global warming.
  Substituting biofuels for oil in the transportation sector won't 
solve these problems overnight, but it will make a difference, and a 
potentially dramatic one in the longer run.
  Let me mention a few eye-opening facts and figures to illustrate 
these points. The United States has less than 5 percent of the world's 
population, but we consume 25 percent of the world's oil. If crude oil 
prices remain above $60 a barrel this year, we will spend well over 
$300 billion on oil imports. Projections indicate that, over the next 
25 years, world demand for energy will grow by 50 percent. All of this 
growth in energy use, of course, contributes to dangerously rising 
levels of greenhouse gas emissions.
  The reality is that gasoline is much more costly than most Americans 
realize, even at $3 a gallon. According to a recent study entitled the 
``The Hidden Cost of Oil,'' gas really costs more than $10 a gallon. 
This is because of all the costs we don't factor into its price at the 
pump, including wars, other military expenses, subsidies, and so on.
  There is no question that the ambitious goals set forth in this bill 
are achievable.
  Several decades ago, Brazil committed itself to a similar course. 
Renewable fuels have played a big part in Brazil's achieving energy 
independence. Currently, ethanol production in

[[Page S4626]]

the U.S. is increasing by 25 percent annually. If we sustain that rate 
of increase, we will be able to reach the aggressive renewable fuels 
standard in the Harkin-Lugar plan. In fact, we will be able to beat it.
  For example, Brazil, years ago directed that all gasoline stations 
carry ethanol as an alternative fuel. Our legislation would require the 
major oil companies to do their share by installing E85 pumps over the 
next decade. This should not pose too much of a challenge or burden.
  Another key to Brazil's success is the fact that, in just 3 years' 
time, nearly 70 percent of new vehicles sold there are flex-fuel 
vehicles. We are asking the auto companies to accomplish a similar goal 
of nearly universal production, only we are giving them a decade to 
phase in the production and sale of flex-fuel vehicles. Most of the 
companies that sell vehicles in the United States also sell them in 
Brazil. If they can produce flex-fuel vehicles for Brazil, they can 
also produce them for the United States.
  Let me explain in more detail why what Senator Lugar and I are 
proposing can be accomplished.
  The 10 billion gallon goal can certainly be met by 2010. The ethanol 
industry will produce more than 4.5 billion gallons this year. There 
are 97 ethanol plants in operation, with 35 more coming on-line in the 
near future. Biodiesel production is growing remarkably, as well, at 
more than 60 plants nationwide.
  The 30-billion-gallon and 60-billion-gallon targets are attainable, 
as well. A joint study by the Department of Agriculture and the 
Department of Energy found that biofuels could supply 60 billion 
gallons of renewable fuels a year--30 percent of current U.S. gasoline 
consumption--on existing lands without any disruption to our food or 
feed supply.
  The key to ramping-up production will be commercializing ethanol made 
from feedstocks in addition to corn and other grains, including corn 
stover, straw from wheat and other crops, switchgrass or even trees. 
There are a host of provisions that I and others authored in the energy 
bill-- ranging from loan guarantees to increased biomass research and 
development--to make cellulosic ethanol production a reality.
  Currently, at least three companies are planning commercial-scale 
cellulosic ethanol plants. They could be operating within the next 2 to 
3 years. One company, Iogen, has the backing of Shell Oil. Just 2 weeks 
ago, according to reports, Iogen received a cash infusion from Goldman 
Sachs. By setting an ambitious new RFS, with a sufficient lead time, I 
believe the 60-billion-gallon threshold is not only attainable, but 
beatable.
  In any case, should something unexpected happen to interfere with 
reaching these benchmarks, the Environmental Protection Agency has, 
within the existing RFS, authority to waive the requirement in whole or 
in part based on a finding of insufficient supply.
  If we take bold actions to guarantee the fuel supply, if we increase 
the number of flex-fuel vehicles capable of running on E85, and if we 
increase the infrastructure ofE85 pumps, we will be poised to usher in 
a new era of energy security much sooner than previously imagined. That 
is the foundation we lay in this legislation.
  This bill would also require that 100 percent of new vehicles 
purchased for federal fleets be alternative-fueled vehicles, which 
could include flex-fuel vehicles. The current requirement is 75 
percent. I do not see why we shouldn't expect the federal government to 
be as aggressive as possible in this area.
  Last year's energy bill closed a loophole in the purchasing 
requirement that had allowed agencies to buy alternative-fuel vehicles 
but not use alternative fuels such as E85. That was a step forward. 
Requiring all the federal fleet to be alternative fueled is yet another 
step forward in having the Federal Government lead by example when it 
comes to alternative fuels.
  We also update the Gasohol Competition Act of 1980, legislation 
designed many years ago to ensure the reasonable availability of 
ethanol at the pump, so it applies to high blends such as E85 and so 
that oil companies cannot prevent a franchisee from installing E85 
pumps.
  The concern back then, and still today, is that petroleum companies 
were unreasonably preventing or prohibiting ethanol-blended fuels from 
being offered at gasoline stations. The Gasohol Competition Act did two 
things. First, it made it unlawful to charge additional credit card 
fees for gasohol. Second, it prohibited unreasonable discrimination 
against the sale of gasohol. Our legislation would update the Gasohol 
Competition Act to prohibit discrimination against E85.
  We are also proposing several relatively modest tax components 
designed to bolster this legislation which will be introduced as stand-
alone legislation.
  The oil-producing countries think they have us over a barrel, but 
they will soon get the message: We have had enough. And we are dead 
serious about determining our own energy future.
  I urge my colleagues to cosponsor this important legislation.

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