[Congressional Record (Bound Edition), Volume 154 (2008), Part 16]
[Senate]
[Pages 22242-22243]
[From the U.S. Government Publishing Office, www.gpo.gov]




                 RENEWABLE ENERGY AND JOB CREATION ACT

  Mr. ROCKEFELLER. Mr. President, I am pleased to support the Renewable 
Energy and Job Creation Act of 2008, which includes a provision that 
extends a credit under section 45 of the Tax Code to ``steel industry 
fuel.'' Steel industry fuel is a feedstock for the production of coke 
that is important to our Nation because it provides significant energy, 
environmental, economic, and financial benefits.
  The energy and environmental benefits include utilizing a high Btu 
content hazardous waste in a fuel product that is created using a 
process that has been approved by the Environmental Protection Agency. 
The use of steel industry fuel makes our domestic steel industry 
economically more competitive by lowering production and operational 
costs. This in turn provides national defense benefits from a stronger 
domestic manufacturing base. It also provides financial benefits to 
steel company employees and retirees who all gain from a more 
competitive steel industry.
  The addition of steel industry fuel to the section 45 credit is 
intended to promote the use of the steel industry fuel process to 
manufacture a feedstock for the production of coke that recaptures the 
Btu content of ``coal waste sludge.'' Coal waste sludge is the tar 
decanter sludge and other byproducts of the coking process. These 
materials have generally been treated as hazardous wastes under 
applicable Federal environmental rules (and in the past have been 
stored in the ground and in lagoons). Coal waste sludge has an energy 
content ranging from 7,000 Btus to 16,000 Btus per pound.
  Coal waste sludge can generally be disposed of by one of several 
methods--use as part of a fuel product, steel industry fuel, 
incineration, or foreign land-filling. The most favorable method, from 
an energy resource and environmental perspective, is to use a process 
that liquefies the coal waste sludge and combines the liquefied coal 
waste sludge with coal to create steel industry fuel for use as a fuel 
product in steel producers' coke batteries. This method recaptures the 
significant energy content of the coal waste sludge and can be 
performed onsite at the steel producers' coke operations. The disposal 
of coal waste sludge in this manner has been approved by the 
Environmental Protection Agency. See 50 Federal Register No. 120, June 
22, 1992.
  The alternative methods of disposal are to transport the coal waste 
sludge offsite for incineration or to foreign countries for 
landfilling. Offsite disposal has significant drawbacks, including the 
need to physically convey a hazardous waste, which is a dangerous, 
cumbersome, and expensive undertaking, and the failure to recapture the 
energy content of the coal waste sludge if it is incinerated or 
landfilled in a foreign country. Incineration of coal waste sludge also 
requires the utilization of energy resources to burn up another energy 
resource, the coal waste sludge.
  Steel industry fuel is produced using a facility that liquefies and 
distributes on each ton of coal approximately one-quarter to one-half 
gallon of coal waste sludge. Liquefied coal waste sludge in these 
amounts avoids operational and equipment problems with the coke 
batteries that use steel industry fuel as a feedstock to produce coke. 
An excessive amount of coal waste sludge in the coke battery causes 
adverse and irreparable damage to the coke battery. Steel industry fuel 
facilities include a facility that is comprised of one or more batch 
tanks and/or one or more storage tanks, steam and spray pipes, 
processing pumps, variable speed drives, a flowmeter, and related 
electrical equipment.
  Explanation of Credit: The refined coal credit for steel industry 
fuel in the act is intended to provide an incentive for the expanded 
production of steel industry fuel. This expanded production is intended 
to provide energy and environmental benefits by promoting the use of an 
alternative fuel that recaptures the energy content of a byproduct of 
the coking process, coal waste sludge, which would otherwise be treated 
as a hazardous waste. Accordingly, a credit is provided for the barrel-
of-oil-equivalent production of steel industry fuel. The steel industry 
fuel provision the Senate approved would modify the current credit 
under section 45 with regard to the amount of the credit and the time 
period for the availability of the credit. This is necessary to 
differentiate the refined coal product that becomes steel industry fuel 
from the refined coal product currently eligible for a credit under 
section 45. Without the distinctions passed in this legislation, steel 
industry fuel would continue to be denied the tax treatment that will 
enable the steel industry to continue to produce coke domestically and 
prevent having to bury toxic waste into landfills.
  To reflect differences between the refined coal currently eligible 
for a credit and refined coal credit that is steel industry fuel, such 
as higher coal costs for the metallurgical coal used to manufacture 
steel industry fuel, the steel industry fuel provision modifies Section 
45 with regard to the amount of the credit, the placed in service 
period, the credit period, and other items.
  The steel industry fuel provision in the act is drafted to provide 
greater certainty to steel industry fuel producers that their fuel 
production is eligible for the credit by providing specific definitions 
for both ``steel industry fuel'' and ``coal waste sludge.'' This 
greater specificity is designed to attract the outside investment that 
is

[[Page 22243]]

needed to finance steel industry fuel projects and expand the use of 
the steel industry fuel process.

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