The Energy Title in Farm Bill

May 16, 2008

By: Sen. John Thune (R-S.D.)

Excerpt from Congressional Record May 15, 2008:

This farm bill is important for a lot of reasons. I don’t have time to get into all the details of why I think this bill is important, but it does preserve a strong safety net. It does provide a permanent disaster title, which is something many of us have sought to achieve for some time, and fought long and hard for. It has conservation provisions that increase funding for certain conservation programs…

I want to make one point, though, because I think if there is anything in this bill as important as any of it, it is the energy title in this farm bill. The reason for that is we have an energy crisis in this country. You cannot go anywhere in my State of South Dakota, I daresay anywhere in this country, without hearing people talk about the high cost of gasoline. There is one thing we have done that is positive in terms of reducing the cost of oil, reducing the cost of gasoline in this country, and that is biofuels, bioenergy.

There is a lot of debate. I want to set one thing straight for the record because there has been a lot of criticism lately of corn-based ethanol and we talk about this whole food versus fuel debate going on in the country today. So people know what the facts are, here are the facts. In 2002, the United States grew 9 billion bushels of corn. Of that, we turned 1.1 billion bushels into 3 billion gallons of ethanol.

In 2007, farmers grew 13.1 billion bushels of corn and turned 3 billion bushels of it into 8 billion gallons of ethanol, leaving 10.1 billion bushels for food, more than the 7.9 billion bushels in 2002.

If you do the math, despite a nearly threefold increase–growth–in the corn ethanol industry, the net corn food and feed product of the United States increased 34 percent since 2002.

Even though we dramatically increased the amount of ethanol we are producing in this country, we still, because of the great hard work of our farmers in this country and the productivity and increases in technology, produced dramatically more corn, so much so that we have 34 percent more corn in 2007 than we did in 2002, notwithstanding the threefold increase in renewable fuels.

I say all that to set the record straight because there is a real debate going on in this country about whether ethanol is to be blamed for higher food prices. Frankly, oil has way more to do with the cost of food and everything else we purchase in this country than does ethanol. But that is not enough. We can do a lot more. The reason the energy title in this bill is so important is because it moves us in a new direction. The next generation of biofuels is what we call cellulosic ethanol, made from biomass, made from wood chips, made from corncobs, made from switchgrasses and other types of grasses that are grown in abundance on the prairies of South Dakota and other places across this country.

We have an enormous opportunity here to not shrink the amount of biofuels we have in this country, but to grow the amount of biofuels because it is the one thing that is keeping gas prices under control.

According to an analysis that was done by Merrill Lynch that was reported upon in the Wall Street Journal a couple of weeks back, if it were not for ethanol, gas prices and oil prices in this country would be 15 percent higher than they are today. That is about 50 cents a gallon for gasoline. We do not need less volume of biofuels, we need more volume of biofuels. That is why the energy title in this farm bill is so important, because it provides important incentives for the next generation of biofuels, cellulosic ethanol, to encourage farmers to grow energy-dedicated crops that can be converted into cellulosic ethanol. As we transition from corn-based ethanol to cellulosic ethanol, we have an incredible opportunity for this country to become less dependent upon foreign sources of energy, to grow our domestic supply of energy in this country in a way that is environmentally clean, in a way that helps support the economy of the United States of America and does not ship billions and billions of dollars every single year outside the United States to purchase imported oil.

This is an important farm bill for a lot of reasons, but the energy title is critical…

(Sen. John Thune. Congressional Record. 5/15/08. p. S4219).