[Congressional Record (Bound Edition), Volume 151 (2005), Part 7]
[House]
[Pages 9198-9199]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           FUELS SECURITY ACT

  The SPEAKER pro tempore (Mr. Kuhl of New York). Under a previous 
order of the House, the gentleman from Nebraska (Mr. Osborne) is 
recognized for 5 minutes.
  Mr. OSBORNE. Mr. Speaker, I did not come here to speak about Iraq. I 
have been there three times and the last time was 3 weeks ago. And each 
time I have been very impressed by the morale and the attitude of our 
soldiers, and they consistently have asked me to do this. They said, 
you know, we see two wars. We see the one that is being fought on CNN, 
and that is true. That is a reality, the bombings. But we also see the 
war that we are fighting. Would you please occasionally go home and 
tell people about the good things that are happening in education and 
health care, economy and so on. And so it is a tough deal. It is tough. 
And yet there are some good things that are happening.
  The reason I came over here tonight to speak was about the Fuels 
Security

[[Page 9199]]

Act, which has been introduced by the gentlewoman from South Dakota 
(Ms. Herseth), the gentleman from Iowa (Mr. King), and the gentleman 
from Minnesota (Mr. Peterson).
  As almost everyone in our country is aware, we have really suffered 
from high fuel prices over the last several months. And this has 
probably been the greatest drag we could possibly have on our economy 
at the present time. We are now nearly 60 percent dependent on foreign 
oil. And OPEC can influence the price of fuel here dramatically by 
either loosening or tightening their fuel supply. We recently saw that 
with our negotiations with Saudi Arabia. And so this is a very 
uncomfortable position for this country to be in.
  An alternative to foreign oil is ethanol and biodiesel. Currently, 10 
percent ethanol blends are roughly 10 to 15 cents a gallon cheaper at 
the pump than regular gasoline. We find that E 85, which is 85 percent 
ethanol, is 60 to 70 cents a gallon cheaper. So in my State, Nebraska, 
E 85 has been selling for about $1.60 a gallon, where other fuels have 
been $2.20 and $2.30.
  Currently, 20 States produce ethanol, and that would include 
California and Kentucky, States that at one time we assumed would never 
be in the ethanol business. And as many people know, ethanol can be 
produced from biomass, even certain types of garbage. And I think 
eventually all 50 States probably will have some type of ethanol 
production of one kind or another.
  In 2004 we produced 3.6 billion gallons of ethanol. This year, 2005, 
we will hit roughly 4.5 billion gallons. And the reason I am here 
tonight is that I want to make clear that people understand that the 
renewable fuel standard in the energy bill passed by the House and now 
sent over to the other body mandates that we go to 5 billion gallons of 
ethanol production by the year 2012. Well, we are going to be over 5 
billion gallons next year, in 2006. And that is why we have introduced 
the Fuels Security Act. The Fuels Security Act proposes that we raise 
the ethanol allotment from 5 billion gallons to 8 billion gallons by 
2012.
  Increasing ethanol production will have several positive consequences 
and effects on the economy. Number one, it will lower the price of 
gasoline. Currently, the ethanol industry that we have in place today 
lowers the average price of a gallon of gasoline by 29 cents. So if 
somebody has been paying $2.20 at the pump, they would be paying about 
$2.50 if we took ethanol out of the picture.
  Ethanol production raises the price of a bushel of corn by about 30 
to 40 cents a bushel. As corn prices increase, farm payments decline. 
It is a countercylical effect. And so ethanol reduces the cost of the 
farm bill by an estimated $5.9 billion over 10 years, which will 
certainly be a benefit to the taxpayer. It will add $51 billion to farm 
income over 10 years. It will reduce the trade deficit by $64 billion 
between 2005 and 2012. And everyone knows that we are suffering from a 
very disadvantageous trade deficit at the present time.
  We will add 243,000 jobs to our economy and reduce greenhouse gases 
by 7 million tons a year. So we think that biodiesel and ethanol is a 
very viable alternative. It reduces our dependence on foreign oil. And 
we would hope that the other body would consider including the Fuels 
Security Act in conference when and if they get the energy bill passed.

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