The American Soybean Association (ASA) and two biodiesel fuel suppliers testified before Congress on July 24, to communicate the benefits of biodiesel for the nation and the farm economy. ASA Executive Committee Member Ron Heck testified before the House of Representatives Small Business Rural Enterprises and Technology Policy Subcommittee. Meanwhile, the Senate Energy Committee received testimony from John Campbell, Vice President of Ag Processing Inc. (AGP), a farmer-owned cooperative, and Gene Gebolys, President of World Energy Alternatives.

All three witnesses praised the “Renewable Fuels for Energy Security Act of 2001,” which has identical bills now pending before the Senate and House. Representative John Thune (R-SD) introduced the legislation, H.R. 2423, while Senators Chuck Hagel (R-NE) and Tim Johnson (D-SD) sponsored S. 1006. The legislation sets a federal goal for increased national use of renewable fuels, such as biodiesel and ethanol. Under the measure, renewable fuels would account for 3 percent of highway transportation fuels by 2011 and 5 percent by 2016. The measure will allow flexible approaches to comply with program goals in ways that best fit within the operations of fuel providers.

“We believe this legislation provides achievable goals for both biodiesel and ethanol while helping to decrease our dependency on imported petroleum,” said Heck, who raises soybeans and corn near Perry, Iowa. “This is a bold and innovative step in moving our country to homegrown energy sources.”

During his testimony, Heck presented the results of a new U.S. Department of Agriculture study that shows biodiesel production can have significant economic benefits for farmer income, rural communities and the overall U.S. trade balance. The study reports an increase of 100 million gallons of biodiesel or other soy-based bioproducts per year would boost total crop cash receipts by $5.2 billion cumulative by 2010, resulting in an average net farm income increase of $300 million per year. The price for a bushel of soybeans would rise by as much as 17 cents annually during the 10-year period.

The study was based on the effect of increasing soybean oil demand by 1.5 billion pounds per year between 2001 and 2010. That is the equivalent of 200 million gallons of biodiesel production a year. The 1.5 billion pound annual average increase in soybean oil demand is projected to induce an increase of over 13,000 jobs. New jobs would be created in the farm sector, food processing, manufacturing, and in the service sectors.

Campbell’s testimony for Nebraska-based AGP identified that even modest levels of alternative and replacement fuel use are providing energy security benefits. “If the United States were to achieve the 10 percent replacement fuel goal of the Energy Policy Act of 1992, oil prices could be reduced by approximately $3 per barrel. At current U.S. oil consumption levels of 6.8 billion barrels, this level of alternative/replacement fuel use results in a savings of approximately $20 billion on an annual basis.”

Campbell also stressed that companies need for Congress to integrate renewable fuels into a national energy strategy to give the private sector the confidence to make further investments. “Biodiesel needs a consumer incentive to help level the playing field in a marketplace that is heavily tilted toward oil and gas,” Campbell said. “We are not anti-oil. We are pro-oil. We just want to make sure there is room for renewables in an already distorted energy market.”

Gebolys of World Energy Alternatives testified that biodiesel brings tremendous environmental benefits to the public. He cited a recent Environmental Protection Agency (EPA) study that found more than 75 percent of all cancer risk associated with outdoor air contaminates relates directly to diesel exhaust. Meanwhile, biodiesel exhaust has been found to be completely nontoxic.

Biodiesel performs comparably to diesel, with similar cetane and BTU content. It is the safest of all fuels to use, handle and store. More than 100 major vehicle fleets use biodiesel, including transit authorities, public utilities, government agencies and school districts. The fuel has been proven successful in more than 40 million road miles and countless off-road, marine, boiler and generator applications.

Biodiesel is listed with the Department of Energy as an alternative fuel and is registered with the EPA as both a fuel and fuel additive. Biodiesel contains no petroleum but can be blended with diesel at any level. It is the only alternative fuel to have passed the rigorous Health Effects testing requirements of the Clean Air Act. The results, submitted to the EPA in 2000, show biodiesel is nontoxic, biodegradable and free of sulfur. Emissions it reduces include carbon monoxide, unburned hydrocarbons and particulate matter.