The American Soybean Association (ASA) “Biodiesel Campaign” took a major step forward last night (July 31) when the U.S. Senate approved an Energy Bill that contained a number of incentives designed to encourage the use of biodiesel, including the ASA-backed biodiesel tax incentive. Biodiesel is a clean-burning alternative to petroleum-based diesel fuel that is produced primarily from soybean oil.

“Securing passage of the biodiesel tax incentive and other measures designed to encourage the use of the fuel is our top legislative priority for the year,” stated ASA President and National Biodiesel Board (NBB) Director Ron Heck from his farm in Perry, Iowa. “Last night’s vote put us one step closer to achieving our goal, and the ASA would like to extend a sincere thanks to our friends in the Senate who fought hard to make this happen.”

After weeks of heated debate, the Senate voted 84 to 14 in favor of the 2002 version of the Energy Bill that provided a 1-cent reduction of the diesel excise tax per percentage of biodiesel blended with diesel up to 20 percent. The bill also includes a Renewable Fuels Standard that calls for the nation’s fuel supply to increase its use of renewable domestic fuels, like ethanol and biodiesel, to 5 billion gallons in 2012.

Incentives increasing biodiesel demand will also boost the need for soybean oil, its primary feedstock, which in turn will raise the price of soybeans. There are other reasons why biodiesel is so important to our country, in addition to these economic benefits. Biodiesel is made primarily from soybean oil grown here in the U.S., so it lessens our country’s dependence on foreign oil. With over 55 percent of the oil we consume coming from the highly unstable Middle East, renewables like biodiesel should become a larger portion of our nation’s fuel supply.

There are environmental benefits of biodiesel production as well. Emissions of greenhouse gases and particulate matter would be significantly reduced by increased biodiesel use. An increased demand for biodiesel could also create thousands of jobs across the U.S. economy.

“Soybean-based biodiesel is good for farmers, good for the environment, and good for our country,” proclaimed Heck. “Incentives designed to encourage people to use biodiesel is the right policy for our country, and, on behalf of the ASA, I applaud the Senate for taking a big step in this direction.”

The U.S. House of Representatives approved ­its Energy Bill earlier this year. The difference between the House and Senate Bills will be reconciled in a joint House/Senate Conference Committee. Conference is where the refinements made by the Senate Finance Committee to the biodiesel tax incentive contained in the 2002 Energy Bill are expected to be included. These refinements were made through the amendment offered by U.S. Senators Chuck Grassley (R-IA) and Blanche Lambert Lincoln (D-AR) during Finance Committee consideration of the energy tax package last April.

In addition to this change, the ASA will be seeking to include in the final Energy Bill other key biodiesel measures, such as those supported by Senators Kit Bond (R-MO), Jim Talent (R-MO), and Tim Johnson (D-SD) that would encourage the use of biodiesel in meeting federal requirements for government alternative fuel use.

“While the Senate vote was a huge victory for biodiesel, supporters of the ASA Biodiesel Campaign should know that anything could change once the bill goes to Conference. The ASA calls on soybean farmers across the land to thank their Senators who supported the bill and encourage them, as well as their Representatives in the House, to express their support for the inclusion of strong biodiesel provisions in the final Energy Bill,” urged Heck.