Co-Chairman, Growth Energy
Before the Senate Environment and Public Works Committee
December 11, 2013
Chairman Boxer, Ranking Member Vitter and all the members of the Committee, thank you for the opportunity to present testimony on the Renewable Fuel Standard.
I am retired U.S. Army General Wesley Clark, Co-chairman of Growth Energy, the country’s leading trade association of ethanol and renewable fuel producers. Growth Energy represents 80 ethanol plants in 14 states and 81 associate members involved in the value chain of producing ethanol. Our plants produce ethanol from grain and are leaders in innovating in second-generation fuels from sources like plant wastes and algae.
Prior to my advocacy on renewable fuels, I spent almost 40 years in our nation’s armed forces and have spent a majority of my time outside of the military discussing our nation’s foreign policy and threats overseas. I can say without hesitation that our nation’s addiction to foreign oil is one of the biggest issues facing our nation – even with newfound domestic supplies of oil and natural gas.
One of the biggest reasons why Congress passed and President Bush signed into law the Renewable Fuel Standard was because of this dangerous addiction to foreign oil. And it has worked. Since 2005, our dependence on foreign oil has decreased from 60 percent to 40 percent, a 33 percent reduction.
More efficient automobiles and increased oil production have absolutely played a role in this, but let’s look at the increase in biofuels compared to the increase in oil production. From 2005 to 2012, U.S. oil production has increased by roughly 25 percent on the back of newfound oil resources. In that same time period, ethanol production has increased by 240 percent, and biodiesel production has increased by 880 percent.
My message to the Committee is this: the Renewable Fuel Standard (RFS) is an overwhelming success. It has reduced our dependence on foreign oil and made our nation more energy independent, created American jobs, revitalized rural America, injected much-needed competition into a monopolized vehicle fuels market, lowered the price at the pump, and improved the environment. That is a great record of accomplishment – one that I would call a brilliant success. It is wise policy, and a tribute to its bipartisan passage.
These are real, tangible results that benefit every American today. But if some had their way, we’d throw all of this progress away so the incumbents can shut out competition and maintain their stranglehold on the wallets of American drivers so that Americans will never escape the burden of imported oil and imported, monopolistic fuel pricing.
We see a different path forward. The Renewable Fuel Standard and higher-level blends of ethanol present the first real opportunity to create fuel diversity in the United States. It has been over 100 years since Americans had a choice in what they use in their automobiles. Now, the oil lobby has begun a sustained, multipronged campaign to kill renewable fuels just as it ramps up and threatens oil’s market share.
The premise that America's newfound oil and gas resources mean we no longer need renewable fuels is simply not true. We are this year going to import almost $400 billion worth of petroleum, the majority from OPEC countries. In addition, in September imports increased by almost 1 million barrels/day. This is to be expected as the economy returns to growth. These imports suck money away from our economy - just like a per capita tax on each and every American of about $1200. Biofuels like ethanol keep those funds inside our economy, creating jobs and building communities. Every one percent of ethanol in our fuel supply retains over $3 billion in our own economy. Today, we are helping retain approximately $30 billion that would have flowed out of our economy. When we fulfill the full RFS vision in 2022, ethanol and other biofuels will be responsible for keeping almost $100 billion annually in our economy that would otherwise go to other nations. Moreover, oil is a global market. We don’t control the price. Because ethanol is historically an average of more than 50 cents gallon cheaper than oil, we are further helping hold a lid on gasoline prices.
With the success of the RFS, the United States is on the brink of energy independence and energy diversity. On behalf of Growth Energy, the biofuels industry, and America’s rural communities, I urge you stay true to the Renewable Fuel Standard that is working and already showing results while still in its infancy.
The RFS will create true consumer freedom in the fuels market. It has reduced fuel costs for American families, has freed the American taxpayer from having to support the agricultural economy, and spurred significant investments in rural America. My testimony today covers seven key topics: