The Department of Energy testified before the Agriculture Committee last fall that renewable agricultural sources could provide as much as 20 percent of our nation's motor fuels by 2010 at prices competitive with gasoline. Ethanol already reduces our need for imported gasoline by more than 90,000 barrels daily. This is an important step in establishing greater energy independence, but such progress will not continue without dedicated research efforts and continued incentives to develop domestic fuel resources. Extending the ethanol tax incentive provides many benefits to the U.S. economy, including jobs and income in farming, construction and processing. Failure to provide incentives sufficient for the long-term development of alternative resources sends a negative signal to producers as they attempt to grow the industry and become competitive with gasoline prices and availability.
Ethanol provides numerous environmental benefits as well.
Renewable ethanol is also extremely energy efficient. Every 100 BTUs of energy used to produce ethanol yields 135 BTUs of ethanol. By comparison, the same 100 BTUs of energy would yield only 85 BTUs of gasoline. Given the potential benefits of ethanol, it is important that incentives be provided to develop the industry and encourage consumer use of bio-fuel products. While some have proposed extending the ethanol tax incentives only until 2000, this fails to consider the problems of instability in the Middle East and the time required for our nation to fully develop alternative energies.