Secretary Vilsack touts renewable energy in Minnesota
By Heather Thorstensen
Date Modified: 05/05/2011 9:05 AM
INVER GROVE HEIGHTS, Minn. — Now is not the time to end incentives for renewable energy production, U.S. Secretary of Agriculture Tom Vilsack said during a visit to Minnesota on April 20.
He came to CHS Inc. in Inver Grove Heights to lead a private round table discussion with renewable fuel stakeholders. It was an opportunity for participants to share their experiences and ask questions.
CHS is the nation's largest agricultural cooperative and one of the nation's largest suppliers of ethanol fuel.
Among those who joined Vilsack for a media briefing were Senator Amy Klobuchar, D-Minn., and Governor Mark Dayton, vice chair of the Governors' Biofuels Coalition.
Incentives need to be done the "right way," Vilsack said. The country has already seen what happens when they are taken away.
When Congress failed to renew the federal biodiesel tax credit before it expired at the end of 2009, production dropped and 12,000 jobs were lost, he said. The credit has since been retroactively extended through 2011.
Creating a cliff by removing incentives would result in more job losses, said Vilsack.
According to information from Sen. Klobuchar's office, the domestic biofuels industry employs 500,000 farmers, producers and processors while displacing about 5 percent of the country's demand for oil.
Vilsack countered the idea that ethanol production is increasing food prices, saying corn is only in about one-third of food. Oil prices are more to blame, he said.
A federal subsidy for corn ethanol, the Volumetric Ethanol Excise Tax Credit, has come under fire as legislators look for ways to reduce federal spending. Bills in the House and Senate have called for its immediate repeal.
The 45 cents-per-gallon credit, given to those who blend ethanol with gasoline, is set to expire at the end of this year if it's not renewed.
Sen. Tom Coburn, R-Okla., the lead sponsor of the Senate bill, says repealing the credit would save $4 billion. The government has already helped create a market for ethanol by allowing more of it to be blended in gasoline for model year 2001 and newer vehicles and requiring that Americans use 36 billion gallons of renewable transportation fuel by 2022, he said.
USDA's actions to back biofuels are supported by President Barack Obama, who in March called for a one-third reduction in oil imports by 2025.
"The Obama administration is working to transform the United States into a global, clean energy leader because renewable energy created from a wide variety of biomass here in Minnesota and across the nation will create a new generation of jobs, reduce dependence on foreign oil and enhance national security," said Vilsack.