Senate passes farm bill with some energy provisons

Posted on December 20, 2007. Filed under: Energy Policy |

From the Environmental Law & Policy Center (ELPC):

Earlier this afternoon [December 14], the U.S. Senate passed the Farm, Nutrition, and Bioenergy Act of 2007 by a vote of 79-14. The Farm Bill now moves to a House and Senate conference committee. It will be on a fast track, with House Ag Committee Chairman Collin Peterson vowing to work through the holidays to finish the bill soon after Congress returns in January.

Energy Highlights . . .
The Senate Farm Bill is a good step in the right direction for energy programs, albeit with much less funding than in the House Farm Bill. Energy highlights include:

To help farmers and rural businesses save money and supply power to America, a better Section 9006 program (now renamed the Rural Energy for America Program – REAP) includes new energy technical assistance, larger loan guarantees, community wind incentives, and carveouts for small, replicable projects and digesters. ($230 million total versus $500 million in House Farm Bill.)

An overhauled biorefinery program to help defray the cost of first-generation cellulosic ethanol plants; also encourages existing biorefineries and industrial facilities to convert to biomass-based heat and power (“Rural Repowering”).

To help build feedstock supply for cellulosic biorefineries, an energy crop transition program that includes improved sustainability standards.

To help defray production costs, production incentives for advanced biofuels.

To develop a stronger knowledge base and help move energy crops from the laboratory to the fuel pump, funding and new priorities for the Biomass Research and Development program.

The Energy Title also includes funding for regional biomass crops and federal biobased product purchasing, a Sun Grant biomass program, and several advanced energy studies.

For the first time the Farm Bill also includes a significant energy tax title. These tax credits are primarily for development of cellulosic and other biofuels production, while also encouraging more community wind development and installation of smaller residential wind energy systems in rural areas.

. . . and Lowlights
On the negative side, the tax title includes $330 million of fossil fuel tax credits for coal-to-liquids, compressed natural gas and other non-biomass fuels used in cars and trucks. That credit has virtually nothing to do with agriculture, and the money would be better spent on renewable energy development in the Energy Title.

It’s All About Money
Funding the energy programs in the Farm Bill faces a serious challenge in the House-Senate Conference. Currently the funding for the House and Senate Energy Titles come from two completely different sources. That means that negotiators will need to decide how to fund the programs, and they will face intense pressure to cut the programs to pay for other programs.

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