FOR IMMEDIATE RELEASE: CONTACT:
July 10, 2008 Chuck Ardo
717-783-1116
Michael Smith (DEP)
717-787-1323
Governor Rendell Signs Biofuels Development and Incentives Acts to Strengthen National Security, Spur Economic Development
PLYMOUTH MEETING – Governor Edward G. Rendell signed legislation today that will help spur the development of homegrown biofuels in Pennsylvania and reduce the state’s dependence on foreign fuels by establishing new requirements that every gallon of gasoline and diesel fuel contain a percentage of ethanol and biodiesel.
“Pennsylvanians are struggling with higher fuels costs,” said Governor Rendell, who signed House Bill 1202 and Special Session Senate Bill 22 into law at the National Armory in Montgomery County. “Record-high fuel prices are straining family budgets and pinching the bottom lines of our businesses. We need to reduce our dependence on foreign oil and keep our energy dollars in Pennsylvania, to invest in our economy and create jobs.”
The biofuel percentage requirements established under the new law will go into effect once in-state production reaches certain levels. The requirements—which include what is believed to be the nation’s first state-specific cellulosic ethanol mandate—will also spur new economic development in renewable biofuels by directing that more of the money spent each year by Pennsylvanians on imported fuels stay in the state.
Pennsylvania’s biodiesel manufacturers will also benefit from new investments under Special Session S.B. 22, which will help spur production and improve competition among producers in other states. Pennsylvania will invest $5.3 million in its in-state biodiesel producers annually through June 30, 2011. These companies will be able to take advantage of a 75 cents-per-gallon subsidy that will be capped at $1.9 million per year per producer.
“Each year, America incurs nearly $400 billion in additional debt to finance our appetite for oil,” said the Governor. “Here in Pennsylvania, we spend approximately $30 billion to purchase liquid fuels from beyond our border. It’s time we keep more of that money here at home and invest in our biofuel manufacturers, communities and transportation industry.
“These bills will position Pennsylvania to emerge as a national leader in the development and deployment of biofuels, including the next generation alternative cellulosic ethanol, which promises to be better for our environment than conventional fuels.”
Under H.B. 1202, as much as 1 billion gallons of biofuels will be added to the state’s fuel supply. The law establishes the following for ethanol and biodiesel production and consumption:
- All diesel fuel sold at retail must contain:
- 2 percent biodiesel, once in-state production reaches 40 million gallons;
- 5 percent biodiesel, once in-state production reaches 100 million gallons;
- 10 percent biodiesel, once in-state production reaches 200 million gallons; and
- 20 percent biodiesel, once in-state production reaches 400 million gallons.
- All gasoline sold at retail must contain:
- 10 percent ethanol, once in-state cellulosic ethanol production reaches 350 million gallons.
The biofuels development bill takes an environmentally responsible approach to the important work of reducing our dependence on foreign oil. Biodiesel reduces many types of air pollutants, including carbon monoxide, volatile organic compounds (VOCs), air toxics, sulfur dioxide and particulate matter.
In addition, the use of renewable fuels results in a significant reduction in lifecycle greenhouse gas emissions compared to the petroleum fuel that is displaced. Biodiesel reduces greenhouse gas emissions by about 50 percent, while cellulosic ethanol could reduce greenhouse-gas emissions up to 86 percent, according to the U.S. Department of Energy.
Pennsylvania already has an in-state biodiesel production capacity of approximately 60 million gallons per year, and the state’s first large-scale ethanol plant—a 100-million-gallons-per-year operation—is under construction in Clearfield County.
The developers of the Clearfield County plant have also committed to developing a pilot scale cellulosic ethanol plant. Another cellulosic demonstration facility is planned for Madison, Westmoreland County.
These projects, and similar ones that follow, will inject hundreds of millions of dollars into Pennsylvania’s economy in the coming years and create thousands of jobs.
A study commissioned for PennFuture by LECG LLC examined the benefits of offsetting 900 million gallons of petroleum-based transportation fuel with renewable and coal-derived fuels by 2017, as originally called for in the Governor’s plan. The study concluded that the plan would add nearly $1.5 billion to Pennsylvania’s economy, create as many as 25,775 new jobs in all sectors of the Pennsylvania economy and put an additional $6.6 billion into the pockets of Pennsylvanians over the next decade.
“Pennsylvania can be to cellulosic ethanol what corn-based ethanol was to Iowa and the Midwest,” said Governor Rendell. “Pennsylvania has an abundant supply of cellulosic ethanol feedstocks, including switchgrass, woodchips, municipal waste and agricultural waste. This alternative fuel law ensures that Pennsylvania farmers and businesses will fully realize the benefits of these resources.”
###
