U.S. Senator Pete Domenici, Ranking Member of the Senate Energy and Natural Resources Committee, today announced that he will file a Renewable Fuel Standard amendment to the 2007 Farm Bill.

The Amendment is identical to the RFS title that was included in the Senate Energy Bill, which passed in June. The Amendment will require 36 billion gallons of ethanol to be used in our nation by 2022, of which 21 billion would come from advanced biofuels, like cellulosic ethanol.

Current cosponsors of the amendment include Senators Thune, Nelson of Nebraska, Grassley, Johnson and Craig.

Below are Senator Domenici’s remarks delivered on the floor this afternoon. Two observations are hard to suppress.

(1) Domenici can snip the 36-billion-gallon mandate out of the energy bill and plop it into the farm bill because ethanol policy has always been corporate welfare for farmers masquerading as energy policy.

(2) Domenici says a new bigger ethanol mandate is necessary because farmers responded so rapidly to the existing 7.5 billion gallon mandate that supply now exceeds demand and ethanol prices are down 40%. That would be good news if the objective were to ease our pain at the pump, as many in Congress pretend, but that’s not what ethanol policy is about (see point 1). An obvious implication of Domenici’s remarks is that Congress will continually have to inflate demand, with ever-bigger mandates, to keep ethanol prices from falling as supply increases in response to the previous mandate. Americans are no more addicted to oil than their ancestors were to horse fodder. But farmers are clearly addicted to government support, and the addiction will grow with each new subsidy and mandate.

Mr. President, I rise this afternoon to discuss the process to consider the Farm Bill that was set forth by the Majority Leader earlier, and to discuss a critical issue facing our farmers. I do not want to belabor the point that has been made so eloquently by the distinguished Republican Leader Senator McConnell and by Senator Gregg about the importance of an open amendment process, but I do want to add some context if I might.

I understand that it is the Majority’s prerogative to fill the amendment tree and it has been done by leaders of both parties in the past. However, I want to go on record about the potential serious danger of this process. Earlier, the Majority Leader stated that only amendments that are relevant to the Farm Bill will be allowed to be offered and voted on.

Well, Mr. President, I cannot think of an amendment more relevant to the economic security of the American farmer than an amendment to increase the renewable fuel standard.

Since we passed the first-ever renewable fuels standard in the Energy Policy Act of 2005, we have seen a surge in ethanol jobs and a surge in the construction of plants. In 2006 alone, the U.S. ethanol industry supported the creation of 160,000 new jobs while producing 5 billion gallons of ethanol. These are American farm jobs which help produce American fuels that help reduce our dependence on foreign oil. It seems to me that the relevance of ethanol is asked and answered.

My bipartisan amendment would set annual requirements for the amount of renewable fuels used in motor vehicles, homes and boilers. It would require that our nation use 8.5 billion gallons of renewable fuels in 2008 and progressively increase to 36 billion gallons by 2022.

My amendment will help the ethanol industry right now by doubling the current ethanol mandate from 7.5 billion gallons in 2009 to 15 billion gallons in 2015. This will ensure that America will be using the additional ethanol that farmers are producing.

Beginning in 2016, an increasing portion of renewable fuels must be advanced biofuels. Advanced biofuels include cellulosic ethanol, biodiesel and other fuels derived from unconventional biomass feedstocks, like sorghum. The required amount of advanced biofuels begins at 3 billion gallons in 2016 and increases to 21 billion gallons in 2022.

Advanced biofuels do not have many of the challenges that conventional ethanol does. The inclusion of advanced biofuels strikes a balance that will allow America to begin diversifying our fuel supply both in the short term and the long term.

That is why when supporting these same provisions in the Energy Bill, the Renewable Fuels Association said that they “strike the right chord” noting that “such an investment in our nation’s energy future promises to spur the creation of new, good paying jobs across the country.”

Mr. President, the amendment that I seek to offer consists of the very same provisions passed by the Senate in June during consideration of an energy bill. Some may ask then, why do I seek to offer this amendment on the farm bill. My answer is two-fold: First, it is clear that the energy bill is languishing largely because the House has passed an irreconcilable bill that places our energy security in doubt by raising energy costs and reducing energy supply. Second, this amendment is relevant to the Farm Bill and necessary NOW to re-invigorate an ethanol industry that is looking to Congress to extend this mandate as soon as possible.

Mr. President, in one sense, we have been a victim of our own success. Thanks to the 2005 Energy Bill, rural America has answered the call for increased ethanol production. In fact, we have now exceeded the original mandated amount in our fuel mix. For example, in 2006, the ethanol standard was 4 billion gallons and, in fact, our domestic production of ethanol was 5 billion gallons. We can do more and the American farmer is looking for Congress to do more.

Over the last year, the price of ethanol has dropped nearly 40%. The reason for this is simple economics. We have an increased supply and diminished demand in the marketplace. As a result the construction of new plants has been delayed meaning new job growth has been diminished and rural communities are looking to us to take action. We cannot wait for a languishing energy bill while rural communities are losing their opportunities. This amendment is not simply relevant to the Farm Bill, Mr. President. It is necessary.