Springfield State Journal Register

November 14, 2002

Ethanol measure shelved for year 
Legislation would have tripled output 

Copley News Service

WASHINGTON, D.C. - An energy bill that would have tripled the amount of ethanol used by the nation's gas refiners by 2012 was declared dead for the year Wednesday by House and Senate conferees. 

Ethanol supporters vowed to continue to work next year to enact into law an ethanol agreement reached by diverse interests from agriculture to oil producers and the American Lung Association. 

"It's incomprehensible that Congress was unable to complete a comprehensive energy bill to reduce oil imports from the Middle East, including Iraq, at the same time we are preparing to put our sons and daughters in harm's way in that very region," said Bob
Dinneen, president of the Renewable Fuels Association, an advocate of the ethanol provisions. 

Illinois Corn Growers Association officials said they were disappointed with the conferees' failure, but remained optimistic. 

"We've done a tremendous amount of groundwork and a lot of the same people are still going to be in Congress next year. Hopefully, we can pick up where we left off and get this thing done early in the next session," said association spokesman Mark Lambert. 

However, critics of the bill see the delay as a chance to rework the bill into a more acceptable form. 

"We're going to come next year and do a much more comprehensive policy that is fairer to consumers," said Frank Maisano, spokesman for the Oxygenated Fuels Association, which represents producers of MTBE, a competing gas additive that would have been phased
out under the Senate version of the bill because it has
contaminated water supplies. 

While the ethanol mandate had strong support from House and Senate leaders as well as the Bush White House, powerful House members from Texas and Louisiana where MTBE is produced threw up a roadblock. They sought the same liability shield for
MTBE that ethanol would get under the legislation. 

In addition, California officials feared the ethanol requirement contained in the Senate-passed version would increase gas prices if the state was unable to import enough ethanol that is produced in Illinois and other Midwestern states. 

Ethanol supporters "will have a much more difficult row to hoe next year," Maisano said. 

The energy bill, which has lingered in legislative limbo since before the election, was officially declared dead Wednesday afternoon when Senate conferees opted not to propose a counteroffer to a much slimmer version of the bill pushed by House Energy and
Commerce Committee Chairman Billy Tauzin, R-La., that did not contain the ethanol mandate. 

"Given the politically charged environment, the deck was stacked against us from the get-go," said Tauzin spokesman Ken Johnson. But he said it wasn't a wasted effort. 

"We have a road map in place now and, after months of difficult negotiations, we know where the hairpin turns are located," Johnson said. "As a result, we can expect a much smoother ride in 2003." 

The main sticking points between the House and Senate remain, including the MTBE ban and liability issue, electricity issues and drilling in Alaska's Arctic National Wildlife Refuge. 

"But the key difference is that this time we will have unified leadership in the House, the Senate and the White House to get something done," he said. 

House Speaker Dennis Hastert, R-Ill., is a key advocate for ethanol in the House. And, two years before a presidential election, President Bush is expected to continue to show strong support for corn-based ethanol despite his background in the oil industry. 

Ethanol production adds $4.5 billion to U.S. farm income annually, according to the Renewable Fuels Association. The nation's largest ethanol producer is Archer Daniels Midland based in Decatur, Ill.