DOD renewable fuels program survives threat

Source: Marc Heller, E&E News reporter • Posted: Friday, September 8, 2017

Efforts to boost the use of renewable fuel by the military survived a challenge in Congress.

Lawmakers in the House agreed Wednesday night to remove from a broad spending measure a provision that would have cut off the Department of Agriculture’s ability to buy non-petroleum fuel for the Defense Department.

Ethanol advocates, led by Rep. David Young (R-Iowa), pushed through the amendment to strike a provision in the omnibus appropriations bill blocking USDA from spending money on the purchases; the House passed Young’s measure as part of a group of amendments approved by voice vote.

The spending package covers funding across several departments for the fiscal year beginning Oct. 1. The Senate has yet to take up any of its appropriations bills (see related story).

The alternative fuel issue stems from a 2014 written agreement between USDA and the DOD, crafted after a Pentagon directive ordering the military to diversify and expand its energy sources.

The Defense Department is the biggest energy consumer in the federal government, using 3.8 billion gallons of fuel in 2014 at a cost of $14.4 billion, according to the Government Accountability Office.

Young and other lawmakers from both parties supported the alternative fuel policy, which preserves USDA’s ability to offset producers’ costs of feedstocks, for instance.

Under the law, alternative fuel can be any non-petroleum source, including natural gas, coal, ethanol or any other fuel the government determines is “not substantially petroleum.”

The memorandum of understanding between the USDA and the Pentagon calls for the Agriculture Department to pay renewable fuel vendors that receive awards from Defense.

Young’s amendment had support from Growth Energy, an ethanol industry group, said spokesman Chris Hogan.

The Defense Department’s renewable fuel policies have run into criticism on Capitol Hill, especially on the armed services committees, where lawmakers say they worry that non-petroleum fuel may be more expensive (Greenwire, April 20, 2016).

In recent years, House Armed Services Republicans have sought to restrict biofuel purchases through annual bills authorizing defense programs.

Despite those complaints, Pentagon rules require that for operational purposes renewable fuels have to be cost-competitive, according to a 2014 GAO report examining the program.

Among the Defense Department’s goals is to meet at least one-fifth of its energy needs with renewable sources by 2020, and to reduce the use of petroleum in nontactical vehicles by 30 percent from 2005 to 2020.

Whether those goals change much in the Trump administration remains to be seen.

Renewable fuels have been a tiny share of the department’s purchases and have mainly been tested for whether they can meet the military’s performance standards.

From 2007 to 2014, the department bought 2 million gallons of alternative fuel, at a cost of $58.6 million, compared with 32 billion gallons of petroleum-based fuel for $107.2 billion, GAO reported.

The Biotechnology Innovation Organization has praised the Pentagon’s moves to use more biofuels, saying advanced biofuels are a promising solution and that the military could establish “tactical biorefineries” in regions such as Hawaii that have large supplies of biomass for fuel.