Published on Wednesday, 30 November -0001 00:00
Minnesota corn and soybean farmers are expected to benefit from renewable fuels legislation recently passed by Congress. After lengthy debate, the legislation passed with ethanol and biodiesel provisions in step with Minnesota's plan to further develop renewable energy alternatives. The American Soybean Association (ASA) and National Corn Growers have made this legislation a top priority for farmers and supporters of renewable fuels. Governor Tim Pawlenty responded to the Senate's passing of the legislation as great news for Minnesota. "Repeal of the antiquated formula that penalized Minnesota for using ethanol was long overdue," said Governor Pawlenty. "This provision alone will mean Minnesota will receive approximately $150 million more per year in Federal highway funding." Minnesota Department of Agriculture (MDA) Commissioner Gene Hugoson said the timing of this legislation complements Governor Pawlenty's recent announcement to boost Minnesota's ethanol mandate from 10 percent to 20 percent. "Minnesota corn and soybean farmers are in excellent position to meet the growing demand for renewable fuels and lead our country away from our dependence on foreign oil," said Commissioner Hugoson. Ed Hegland, National Biodiesel Board Director and farmer from Appleton, said the biodiesel tax incentive is good for farmers and good for the environment. "This is a huge victory for biodiesel and soybeans, particularly in Minnesota with our 2 percent biodiesel production requirement being implemented next summer," said Hegland. "Biodiesel reduces harmful emissions of sulfur dioxide and other pollutants, producing cleaner air." The bill contains an ethanol producer tax credit allowing farmer-owned cooperatives to share the benefits of the program with their farmer members. A new Volumetric Ethanol Excise Tax Credit (VEETC) will replace the current excise tax exemption and provide greater flexibility to refiners who blend ethanol fuel. This credit was scheduled to expire in 2007 and has been extended periodically since it was established in the late 1970s. Minnesota's ethanol industry, the fourth largest in the U.S., will be supported by an extension of the ethanol tax incentive through 2010. In accordance with the Americans With Disabilities Act, an alternative form of communication is available upon request. TTY (800) 627-3529 The biodiesel tax incentive would amount to a penny per percentage point of biodiesel blended with petroleum diesel. This will lower the cost of biodiesel to consumers in taxable and tax-exempt markets. Increased demand for biodiesel is expected to add an additional $.17 per bushel to the market price for soybeans. The ASA estimates that over a five-year time period, the new biodiesel tax incentives will add $1 billion directly to U.S. farmers' bottom line.