Governors’ Ethanol Coalition Recommendations: Current Status and Next Steps

1. Governors’ Ethanol Coalition Recommendations:Current Status and Next Steps Farm Bill 2007

2. Governors’ Ethanol Coalition: New Policy Recommendations • Establish a Sustainable Bioenergy Crop Production Program • Establish a Low Carbon Renewable Fuels Loan Guarantee Program • Undertake Risk Management Initiative to Support Bioenergy Crop Production • Initiate Transportation Studies to Improve Biofuels Access to Market • Support Enhanced Soil Quality Modeling for Biomass Removal

3. Governors’ Ethanol Coalition: Appropriations Recommendations • Provide Full Funding for the Biomass Research and Development Act • Provide Full Funding for Production Incentives for Cellulosic Biofuels • Increase Funding for the Renewable Energy Systems and Energy Efficiency Improvements Program • Increase Funding for the Conservation Security Program (CSP) and Environmental Quality Incentives Program (EQIP) • Increase Funding for the Biobased Products Procurement Program • Increase Funding for and Re-authorize the Sungrant Initiative

4. Farm Bill Status • House passed 2007 Farm Bill on July 28, 2007 • Senate to mark-up 2007 Farm Bill in September

5. Governors’ Ethanol Coalition: New Policy Recommendations:Actions Taken • Establish a Sustainable Bioenergy Crop Production Program Action Taken in the House: • Created a Biomass Energy Reserve Program to Develop the Next Generation of Feedstocks for Renewable Energy with the Feedstock Flexibility Program for Energy Producers (Section 9016)

6. Governors’ Ethanol Coalition: New Policy Recommendations:Actions Taken • Establish a Low Carbon Renewable Fuels Loan Guarantee Program Action Taken in the House • Provided Loan Guarantees for Biorefineries and Biofuels Production Plants (Sec. 9003) • Mandatory funding of $800m over 5 years • Likely to need improvements to sustainability criteria

7. Governors’ Ethanol Coalition: New Policy Recommendations:Actions Taken • Undertake Risk Management Initiative to Support Bioenergy Crop Production Action Taken in the House: • No action

8. Governors’ Ethanol Coalition: New Policy Recommendations:Actions Taken • Initiate Transportation Studies to Improve Biofuels Access to Market Action Taken in the House: • Included provision for Dedicated Ethanol Pipeline Feasibility Studies (Section 9014).

9. Governors’ Ethanol Coalition: New Policy Recommendations:Actions Taken • Support Enhanced Soil Quality Modeling for Biomass Removal Action Taken in the House: • Created research initiatives for research related to bioenergy and biobased products through the Agricultural Bioenergy and Products Research Initiative (Section 7410) • Includes environmental assessment of biomass production on Federal land, specifically impact on soil and water, in the Biomass Research and Development Act (Section 9006) • Additional improvements would likely be helpful as the bill moves forward

10. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Provide Full Funding for the Biomass Research and Development Act Action Taken in the House: • Biomass Research and Development Act authorized at $200,000,000 per year from 2006 through 2015. (Section 9006) • Mandatory funding of $420m over 5 yrs

11. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Provide Full Funding for Production Incentives for Cellulosic Biofuels Action Taken in the House: • Improves and Increases Funding for the CCC Bioenergy Program (Section 9007) • Mandatory funding of $1.4 billion over 5 years

12. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Increase Funding for the Renewable Energy Systems and Energy Efficiency Improvements Program Action Taken in the House: • Increased Funding for the Renewable Energy & Energy Efficiency Improvements Program and renamed program Rural Energy for America Program (REAP) (Section 9005) • Mandatory funding of $500m over 5 years • Loan guarantee levels expanded to $25m

13. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Increase Funding for the Conservation Security Program (CSP) Action Taken in the House: • Significant decrease in funding for the Conservation Security Program (CSP) (Section 2103) • NOTE: The House knows the Senate is going to provide greater funding to CSP and appears to be positioning for the conference negotiations

14. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Increase Funding for the Environmental Quality Incentives Program (EQIP) Action Taken in the House: • Significantly increases Funding for the Environmental Quality Incentives Program (EQIP) (Section 2501)

15. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Increase Funding for the Biobased Products Procurement Program Action Taken in the House: • Increases funding for and makes other improvements to the “Biopreferred” program (Section 9002)

16. Governors’ Ethanol Coalition: Appropriations Recommendations: Actions Taken • Increase Funding for and Re-authorize the Sungrant Initiative Action Taken in the House: • Reauthorized through 2012 (Section 9008) • The House did not provide additional funding however

17. Governors’ Ethanol Coalition: Senate, Conference and Beyond - Senate will have similar program initiatives but more of them, hopefully with more money overall - Conference will take time but ultimately produce a significant energy package especially for cellulosic ethanol and low-carbon biofuels deployment - President is quite likely to sign the bill despite objections over funding sources and other concerns

18. Governors’ Ethanol Coalition: Next Steps • Will seek funding to continue farm bill work over the course of the next year • Focus on policy research, funding, and communications work building upon the previous recommendations • Work will involve farm bill deliberations in the coming weeks and then, upon passage, shift to agency implementation