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Monday, June 4, 2007
ENCOURAGING BIOFUEL GROWTH AND DIVERSITY

In an effort to further reduce U.S. dependence on foreign oil and create a more environmentally-friendly fuel, I joined my colleague Senator Thune from South Dakota last month in introducing legislation that encourages farmers to grow energy crops to make cellulosic ethanol. Like my initiative to promote the development of biogas, this legislation diversifies the sources our country can use for energy, which helps stabilize our expanding biofuels industry. Cellulosic ethanol has always faced a chicken-or-the-egg problem: it's difficult to start commercial production without a guaranteed supply of biomass, but it's hard to encourage farmers to grow the biomass unless they know they'll have a market. This legislation will help resolve that problem by encouraging the construction of biofuel facilities while simultaneously pushing the production of biomass.

The legislation, the Biofuels Innovation Program Act of 2007, seeks to help advance our biofuels production and move us closer to capturing the potential of cellulosic ethanol production. The bill provides business planning and assistance matching grants of up to $30,000 for entities and communities interested in developing a project area for producers to begin producing dedicated energy and biomass crops, as well as for attracting or creating a cellulosic biofuels facility.

The grant applicants would be required to submit a proposal that identifies eligible cropland and indicates that the area has a strong likelihood for producing biomass for energy. The proposals would have to include a letter of commitment from an existing or proposed biofuels production facility to use the feedstock for producing biofuels or other energy.

Once the grant is approved, the areas around the plant (within a 75 mile radius) would be classified as Biofuels Innovations Program (BIP) Project Areas, making them eligible for transitional assistance for the production of biomass feedstock. The assistance would be provided in the form of a percentage of the establishment cost incurred by a producer to plant and grow a biomass crop, as well as yearly rental payments on the land that is growing the biomass crop for the first five years of the BIP contract. This will help producers get energy and biomass crops established and growing at the same time that the cellulosic biofuel plant is being built so that the feedstock will be ready when the biofuel plant needs it.

Finally, the bill provides optional transitional assistance in the form of a matching payment to producers for the purchase of the biomass by the biofuel facility. This provision will help create a market for the biomass. While the grants help get biofuel plants up and running, assistance will be given to area producers with the transition to growing crops for biomass. We'll be pushing both areas of development along the same track, providing a boost for the new fuel site and encouraging further development of domestic energy supplies. Celluosic ethanol has shown great potential, but it faces significant hurdles. Our bill will help clear the hurdles and encourage widespread development of biofuel plants. And with the strong support of groups such as the National Wildlife Federation, the American Coalition for Ethanol, and Ducks Unlimited, I hope we can pass this legislation and strengthen the future of our fuel supply.  

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