[Congressional Record Volume 154, Number 102 (Thursday, June 19, 2008)]
[Extensions of Remarks]
[Page E1282]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           INTRODUCTION OF IMPORTED ETHANOL FACILITATION ACT

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                            HON. MARK UDALL

                              of colorado

                    in the house of representatives

                        Thursday, June 19, 2008

  Mr. UDALL of Colorado. Madam Speaker, today I am introducing a bill 
to facilitate the importation of ethanol. It is cosponsored by my 
colleague from Colorado, Mr. Perlmutter, and I appreciate his support.
  The bill will direct the President to lower the ethanol import 
tariff, so that it will never be higher than the tax-credit subsidy for 
blending ethanol into gasoline.
  Historically, the ethanol tariff was linked to the subsidy, and so 
had the effect of precluding foreign ethanol blenders from benefiting 
from the subsidy. However, the recently-enacted Farm Bill will reduce 
the subsidy but simultaneously extend the tariff for 2 more years at 
$0.54 per gallon.
  Unless that changes, the tariff will be changed into a trade barrier 
that will make it even harder for ethanol imports to enter the U.S. 
market. This can have serious adverse consequences. For example--
  By restricting supplies, it will tend to increase the price of fuel--
including both gasoline and ethanol--in the United States.
  It will make it harder to import sugar-based ethanol, which can work 
in today's cars and, like other ethanol emits considerably less 
lifecycle greenhouse gas than gasoline.
  It works against imports from friendly countries that produce ethanol 
while oil and gasoline imports from OPEC enter the United States tax-
free.
  It hinders the emergence of a global biofuels marketplace that could 
permit mutually beneficial trade between producing regions and 
stabilize both fuel and food prices.
  And it tends to increase our dependency on fossil fuels--including 
petroleum from the Middle East--when we should be working to reduce 
that dependency.
  By restoring the role of the tariff as an offset, not a trade 
barrier, my bill will prevent those consequences. In this respect, it 
is a companion to legislation (S. 3080) introduced in the Senate by 
Senator Feinstein.
  In addition, my bill will require the Energy and Commerce Departments 
to report to Congress regarding the possible effect of further 
reducing--or even eliminating--the tariff on ethanol on fuel supplies 
and prices in the United States and on the domestic production of 
ethanol.
  I have included this provision because I think it is worth exploring 
whether legislation to further reduce or eliminate the tariff could 
help reduce fuel prices without serious harm to our domestic ethanol 
industry.
  Madam Speaker, this bill alone will not do all that should be done to 
revise and reform our energy policies. But I think it can help, and I 
think it deserves the support of all our colleagues.
  For the benefit of our colleagues, here is an outline of the bill's 
provisions:


                       Section-By-Section Outline

  Section one provides a short title, ``Imported Ethanol Facilitation 
Act.''
  Section two sets out findings regarding the reasons for the bill. It 
also states the bill's purpose, which is ``to ensure that the tariff on 
ethanol does not exceed the tax credit applicable to blenders of 
ethanol, to avoid erecting a new trade barrier to imports of ethanol 
while assuring that foreign blenders will not benefit from the tax 
credit, and to require a study of potential effects of further 
reduction in or elimination of the duty on ethanol.''
  Section three directs the president to act to ensure that the ethanol 
tariff will not exceed any tax credit applicable to ethanol.
  Section four requires the Department of Energy and the Commerce 
Department to report to Congress regarding the effects any further 
reduction--or elimination--of the ethanol tariff would have on (1) fuel 
supplies and fuel prices in the U.S.; and (2) the domestic production 
of ethanol. The deadline for this report would be 90 days after the 
bill's enactment.

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