ETHANOL: Wis. Senate rejects 10 percent mandate

The Wisconsin Senate voted yesterday to kill a bill that would have required all regular gasoline sold in the state to contain 10 percent ethanol.

The two-hour debate focused on the benefits to state corn growers versus the potentially higher costs and lower fuel economy. Gov. Jim Doyle (D) said he was "deeply disappointed" that the Senate voted against the bill, which the Assembly had advanced in December.

"We grow corn. We have ethanol plants," said state Sen. Jon Erpenbach (D). "Unless we tell the nameless, faceless oil companies, 'This is what you have to do,' they'll tell us what to do."

But state Sen. Neal Kedzie (R) said that "the public is not ready to be told what they can and can't put in their gas tanks," adding that ethanol "is growing on its own, it's finding its own market through regular free-market enterprise, and that's how it should work."

State Senate Majority Leader Dale Schultz (R) said he would try other methods of promoting the state ethanol industry in the next legislative session (Jones/Forster, Milwaukee Journal Sentinel, March 10).

GOVERNOR PATAKI UNVEILS COMPREHENSIVE PLAN TO CUT NEW YORK's DEPENDENCE ON IMPORTED ENERGY

Initiatives Will Boost Production and Use of Renewable Fuels, Promote Use of Energy-Efficient Vehicles, Position NY as World Leader in Renewable Energy Research and Job Creation, and Provide Relief from High Heating  Bills

Governor George E. Pataki today unveiled  a  comprehensive, multi-faceted  plan that will help reduce New York's dependence on imported energy, position the State to become a center for renewable energy research and  job  creation,  and provide help for soaring home heating bills to New Yorkers.

The  plan, most of which is included in the Governor's Executive Budget,  is  designed  to encourage the production and use of renewable fuels in New York, promote the expanded use of  energy-efficient  cars and vehicles, spur new renewable energy research and  job  creation,  and  provide  relief to New Yorkers from rising energy bills.

New  York  State  must  continue  our  efforts  to  increase  energy efficiency  and  the use of clean and renewable fuels so that we can reduce our  dependence  on  imported energy," Governor Pataki said.  My plan will encourage the development of more  new  and  more  energy-efficient technologies,  bolster  the production and use of renewable fuels, and help to  reduce  the  high  energy  cost  burdens that hurt our families and our economy."

Highlights of the Governor's plan include: elimination of state taxes on  renewable  automotive  fuels; creation of new renewable fuel stations across  the  State; development of  "clean coal" power plants; a new hybrid vehicle  tax credit; discounted Thruway tolls for hybrid vehicles; creation of  a  new  state-of-the-art  alternative  fuel  vehicle  research lab; new tax-free  benefits  for clean energy companies that create jobs; a new $500 tax  heating  credit  for  lower-income  seniors; a $50 million increase in Low-Income  Home Energy Assistance Program (LIHEAP) benefits, and a new tax credit for homeowners who upgrade to a high-efficiency home heating system.

 "This  plan  is  a  blueprint to encourage additional private sector development  of alternative energy sources, attract jobs and investments in clean  energy, and help to diversify our fuel supplies," the Governor said. "I  call on the Legislature to join in this effort to create an independent energy future for all New Yorkers."

Specific elements of the Governor's comprehensive plan include:

Encouraging the Production and Use of Renewable Fuels in New York

Elimination  of  All State Taxes on Renewable Automotive Fuels:  The budget will  eliminate all New York State taxes on renewable automotive fuels such as  E85  (85%  ethanol,  15%  gasoline)  and  B20 fuels (20% biodiesel, 80% petroleum,  which  currently  total approximately 40 cents per gallon. This will  lower  the  price  of  these  renewable  fuels  so  that they will be competitively priced, and possibly cheaper, than petroleum fuels.

Creation  of  New  Renewable  Fuel  Stations  Across  the State:  More than 180,000  cars  and  trucks  registered  in New York State are flexible fuel vehicles  meaning  they  can run on gasoline or ethanol fuel.  In addition, diesel vehicles are able to run on a mix of biodiesel and petroleum.  A new $5  million program, administered by the New York State Energy Research and Development  Authority  (NYSERDA),  will  provide competitive grants to gas stations to install or convert pumps so they can dispense E85 (85% ethanol, 15%  gasoline)  and B20 fuels (20% biodiesel, 80% petroleum).  These grants of  up  to $50,000, along with existing tax incentives at the Federal level of  up  to  $30,000,  will  help  spur the creation of an infrastructure to accommodate  vehicles  that  run  on renewable fuels.  In addition, the New York State Thruway Authority will install or convert pumps at all 27 of its Travel  Plazas  to make renewable fuels easily accessible to drivers across the State.

In  addition, the State Department of Motor Vehicles (DMV) will send direct mail  advisories  to  all owners of alternative-fuel vehicles registered in the  State,  informing  them of their ability to utilize renewable fuels in their vehicles.  DMV also will develop a statewide map of renewable fueling locations  and provide it to these vehicle owners so they can easily locate stations that provide alternative fuels.

$20M  Program  to  Promote  Development of"Cellulosic" Ethanol:  The State  Department  of  Agriculture  and  Markets  will administer a new $20 million  program  that  would lead to the development of a pilot cellulosic ethanol  facility  in  New  York. Cellulosic  ethanol  is made from plant materials  abundant  in New York State, including agricultural and forestry residues, pulp and paper mill wastes, and certain grasses and shrubs.  This type of ethanol will further increase the"net energy balance" for ethanol.

Promotion  of  Advanced  "Clean  Coal"  Power  Plants:  State  agencies and authorities  will  collaborate  over a five-year period to identify"shovel ready"  sites for the development of Integrated Gasification Combined Cycle power  plants  ˆ  commonly referred to as"clean coal" plants. These plants utilize  coal  in  a  manner  that  is significantly more protective of air quality.  Under  this  program,  the  New  York Power Authority (NYPA) will provide  $50  million  to a private sector power generator(s) who agrees to host  research and development of new technologies that would reduce carbon dioxide  emissions,  which contribute to climate change. NYPA will also buy power  from  this  facility. Existing brownfield properties would receive priority consideration during the siting process.

Promoting the Use of Energy-Efficient Vehicles in New York

Creation  of  a  New  Hybrid Vehicle Tax Credit:  This new tax credit would  provide  a  $2,000  personal  income  tax  credit to individuals who purchase  new  hybrid,  alternative  flex-fuel  vehicles to help defray the higher  costs  associated with the purchase of these vehicles. This measure is  expected to provide $5 million in tax savings this year and $10 million in subsequent years when fully in place.

Discounted  Thruway  Tolls for Hybrid Vehicles: The Governor has directed the  New  York  State  Thruway  Authority to create a new"Green" E-Z pass, which  will  provide  a  10  percent discount for drivers of fuel-efficient vehicles, such as hybrids that average at least 45 MPG and meet certain EPA emissions standards.

New  HOV  Lanes  Access  for  Alternative  Fueled  Vehicles: This new initiative  will allow cars and other vehicles that average at least 45 mpg and  meet certain EPA emissions standards to use HOV lanes in New York City and  on the Long Island Expressway -- regardless of the number of occupants in the vehicle.

Creation  of  New  State-of-the-Art  Alternative Fuel Vehicle Research Lab: NYSERDA  and  the  Department  of  Environmental  Conservation  (DEC)  will collaborate  on  a  new  $24  million state-of-the-art laboratory that will support  the  development  and  manufacture  of  clean and renewable energy technologies  for  transportation. This  facility,  to  be located in the Saratoga  Technology and Energy Park (STEP) in Malta, will conduct research and  testing  of  new  and  improved fuels, batteries and pollution-control devices,  including  plug-in  hybrids,  hydrogen vehicles, renewable fuels, emerging distributed generation, and thermally-activated technologies.

New  Program  to  Promote  Production of Flex-Fuel and Plug-in Hybrid Vehicles:  This  new, $10 million competitive grant program administered by NYSERDA  will  help  New  York  become  a national and global leader in the production  of  flex-fuel  hybrids  and  plug-in hybrids.  The program will provide  support to companies with research or production facilities in New York that are working to develop these types of vehicles.  Flex-fuel hybrid vehicles  and  plug-in  hybrids,  which  can  be  charged through household outlets  at  night when electricity grid demand is low, would significantly increase vehicle mileage, helping to reduce our dependence on petroleum and lowering fuel bills for drivers.

New  Program  to  Develop  Advanced,  Energy-Saving  Technologies for Vehicles: A  new  $10  million  program  will  be  created to support the research  and  manufacturing  of  lightweight car/vehicle parts, which will reduce  overall  weight  of  the  vehicles  and  improve fuel mileage.  The program  will  also  promote  the  development  and  deployment of the next generation  of  motor  vehicle  technologies,  such as high capacity hybrid vehicle  batteries.  The program will include competitive grants to attract start-up companies to locate or expand in New York State.

Research and Development of  Hydrogen  Vehicles:  NYSERDA  will administer  a  $5 million program to continue the development of a hydrogen vehicle  infrastructure and conduct research to convert internal combustion vehicles  to  be  able to use hydrogen as fuel, which is a promising energy technology.

Positioning  New  York  to  Become a Center for Renewable Energy Research & Jobs

New  Tax-Free  Benefits  for  Clean Energy Companies Tax Credit:  The Empire  Zones  program  will  be  expanded  to give qualifying clean energy companies  all  of  the benefits of Empire Zones -- regardless of where the company  is  located. These  benefits include tax reduction credits, real property  tax  credits, sales tax exemptions, wage tax credits, and utility rate  reductions,  among others and the benefits can reduce a company's tax liability  to  as  little as zero.  This measure would essentially make the entire State a tax-free zone for clean energy companies that create jobs in New York.

Creation of a new Renewable Fuel Production Tax Credit:  This new tax credit  would  provide  New York companies that make renewable fuels, a tax credit for each gallon of fuel they produce.  This measure would provide up to $1 million in tax savings annually per facility.

New Help to Homeowners from Rising Home Heating Bills

Home  Heating  Tax  Credit for the Elderly:  This new tax credit will provide  New  York's  seniors age 65 or older with incomes up to $75,000 or less with a new refundable personal income tax credit of up to $500 for the cost of fuel for heating their principal residence.  The credit would equal 25  percent of home heating expenses when a senior's total heating expenses exceed 7.5 percent of income.

Increased  Home  Heating  Assistance  for  Families: The State will provide  up  to  $50 million in supplemental benefits to help families meet rising  energy  costs,  if the Federal government does not increase funding for  the  Low-Income  Home Energy Assistance Program (LIHEAP). This funding would increase to $250 million the amount provided under LIHEAP to New York each year.

New Tax Credit for Upgrading Home Heating Systems:  The Budget will propose a  new  $500  income  tax  credit  to  homeowners  who purchase and install high-efficiency  heating  equipment.  This credit will be equal to up to 50 percent of the cost of replacement or renovation of a home heating system.

Two  Sales Tax Free Weeks for ENERGY STAR Products: The Budget will propose two  new  sales  tax-free  weeks  for  ENERGY  STAR products -- encouraging consumers  to  purchase  energy-efficient  light  bulbs,  air conditioners, refrigerators, and other household appliances.

Under  Governor Pataki's leadership, New York State currently invests nearly  $300  million  annually  in  energy efficiency and renewable energy programs. Among  key  initiatives proposed and enacted by Governor Pataki are: the Renewable Portfolio Standard for Electricity that requires that by 2013  at  least  25  percent  of  New  York's electricity be generated from renewable  energy; the System Benefits Charge (SBC) that provides more than $150  million  annually for improving energy efficiency and reducing energy use; a Green Power Mandate for State agencies that requires that by 2010 at least  20  percent  of overall State facility energy requirements be met by renewable"green"  sources  and;  the  Green  Building  Tax  Credit,  the first-of-its-kind  tax  credit  to  promote more energy- efficient building designs.