The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“THE BIODIESEL PROMOTION ACT OF 2002” mentioning the U.S. Dept of Agriculture was published in the Senate section on pages S845 on Feb. 14, 2002.
The publication is reproduced in full below:
THE BIODIESEL PROMOTION ACT OF 2002
Mrs. LINCOLN. Mr. President, yesterday I introduced S. 1942, the
``Biodiesel Promotion Act of 2002,'' to provide tax incentives for the production of biodiesel from agricultural oils. I was pleased to be joined by Senators Dayton and Johnson as original co-sponsors of my bill.
I was also pleased yesterday to be joined by Senator Grassley in offering S. 1942 in amendment form to the Senate Finance Committee Energy Tax Incentives legislation. My amendment was included in the legislation with an overwhelmingly favorable vote of 16 to 5. The amendment differs from S. 1942 only in the length of authorization of the program. Due to budget constraints, the amendment authorizes the program for three years as opposed to the bill language of a ten-year authorization.
S. 1942 is a start, but we must make sure that these incentives are not just a flash in the pan. We must ensure that biodiesel becomes a central component of this nation's automobile fuel market.
S. 1942 will provide a partial exemption from the diesel excise tax for diesel blended with biodiesel. Specifically, the bill provides a 1-
cent reduction for every percent of biodiesel blended with diesel up to 20 percent.
The bill also provides for reimbursing of the Highway Trust Fund from the USDA Commodity Credit Corporation, (CCC). I believe this procedure will protect the Trust Fund from lost revenues due to the biodiesel incentive while providing a much-needed boost to our nation's biodiesel industry. The cost to the CCC would be offset at least initially by the savings under the marketing loan program.
Biodiesel, which can be made from just about any agricultural oil including oils from soybeans, cottonseed, or rice, is completely renewable, contains no petroleum, and can be easily blended with petroleum diesel. A biodiesel-diesel blend typically contains up to 20 percent renewable content. It can be added directly into the gas tank of a compression-ignition, diesel engine vehicle with no major modifications. Biodiesel in its neat or pure form is completely biodegradable and non-toxic, contains no sulfur, and it is the first and only alternative fuel to meet EPA's Tier I and II health effects testing standards.
Biodiesel also has many environmental and operational benefits. One I would like to highlight is the fuel's lubricating characteristics. Even at very low blends, biodiesel contributes operational and maintenance benefits to diesel engines by continuously cleansing the engine as it runs. This is even more significant when using ultra-low sulfur diesel. With the EPA's new rule to reduce the sulfur content of highway diesel fuel by over 95 percent, biodiesel stands ready to help us reach this requirement.
Farmers in my State of Arkansas and across the country began investing in the development of biodiesel because of the economics of the farm industry. Producing biodiesel from farm commodity oils will provide a ready new market for our farm products. Currently, agricultural oils are widely produced for use in our food markets. However, large supplies of vegetable oils in the world market have resulted in depressed commodity prices in the domestic market.
More than a decade ago, soybean growers recognized that the traditional approach of riding out a depressed market by storing surplus soybean oil until better times would no longer work. The industry had to do more. It needed a proactive and aggressive plan to develop new markets and expand existing ones. Biodiesel is one of these new markets identified with true potential for displacing large quantities of soybean oil.
For cotton, the cottonseed is presently about 20 percent of the value of the crop. Biodiesel will open new value-added uses for the cottonseed oil at a time when new uses and markets are extremely important because of these hard economic times. And for our rice farmers, biodiesel will provide additional incremental increases in value to our rice crop and open up a new outlet for the co-product of rice bran oil.
A Department of Energy and Department of Agriculture study has shown that biodiesel yields 3.2 units of fuel product energy for every unit of fossil energy consumed in its life cycle. By contrast, petroleum diesel's life cycle yields only 0.83 units of fuel product energy per unit of fossil energy consumed. Such measures confirm the ``renewable'' nature of biodiesel.
Even after years of research and market development, biodiesel is not yet cost-competitive with petroleum diesel. In order to be so, market support and tax incentives are needed. I believe the provisions provided in this bill will help in leveling the field for biodiesel blends and help jumpstart this exciting new industry.
The time is right for this investment. It is right for our rural economy, for our environment, and for our national energy security.
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