Fueling the Economy
By Rep. Kristi Noem
I’ve supported ethanol for a long time – and for a lot of different reasons. Ramping up ethanol production expands commodity markets, helping support South Dakota farmers. The communities where ethanol production facilities are located receive tremendous economic benefits from the jobs and investments that are driven into the area. And every gallon of ethanol we produce is a gallon of oil we don’t have to buy from the Middle East, strengthening our national security by moving us toward greater energy independence.
South Dakota has long been a leader in ethanol production. POET, which got its start in Scotland, South Dakota, is one of the world’s largest ethanol producers – and they aren’t the only producers in the state. This August, I had the opportunity to celebrate the 10-year anniversary of Glacial Lake Energy’s Mina location, which has grown quickly over the last decade and produced an economic impact of around $400 million for the area. That is truly value-added agriculture.
While biofuel production has taken off in South Dakota, corn-based ethanol (and its soybean counterpart, biodiesel) still make up only a small portion of the overall fuel market. There are steps we can take to start closing that gap, however.
One of the first steps is expanding access. The Renewable Fuel Standard (or RFS) tells refineries how many gallons of renewable fuels should be blended into our overall supply. In other words, it helps get ethanol and biodiesel into gas pumps around the country. The Obama administration repeatedly fell short of meeting the legislative requirements, and former EPA Administrator Scott Pruitt failed to make the adjustments needed in the new administration. While President Trump has expressed his commitment to maintaining a strong RFS, more must be done.
I’ve also encouraged the president to allow for year-round E-15. Most reading this understand that it’s been a tough few years for agriculture. The situation’s only been made more difficult by China’s retaliatory tariffs on American commodities. I’m grateful the administration recognized the burden farmers and ranchers were bearing and offered some relief through USDA, but farmers don’t want to have to rely on aid. We want trade. Expanding opportunities for ethanol production expands markets for South Dakota farmers, which is critically needed at this time.
Another way to help expand South Dakota’s role in our fuel supply is through the tax code. For instance, tax credits have expanded the use of biodiesel at the pump. I’ve worked to champion legislation to extend the $1 per gallon biodiesel tax credit.
South Dakota has always been a powerhouse when it comes to agriculture. We fuel America’s bodies that way. But by pushing for expanded markets for our biofuels and increasing energy innovation, South Dakota can revolutionize the way we fuel both our vehicles and our economy.