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

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

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

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

Establish a Sustainable Bioenergy Crop Production Program 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) Governors’ Ethanol Coalition: New Policy Recommendations: Actions Taken

Establish a Low Carbon Renewable Fuels Loan Guarantee Program 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 Governors’ Ethanol Coalition: New Policy Recommendations: Actions Taken

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

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

Support Enhanced Soil Quality Modeling for Biomass Removal 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 Governors’ Ethanol Coalition: New Policy Recommendations: Actions Taken

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 (Section 9006) –Mandatory funding of $420m over 5 yrs

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

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

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

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)

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)

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

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

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