Sen. Meyer and Reps. Heinrich and Widlitz Propose Consumer and Environmentally Friendly Fuel Bill

State Sen. Edward Meyer and state Reps. Deborah W. Heinrich (D-Madison) and Patricia M. Widlitz (D-Guilford) recently unveiled a legislative proposal that they will introduce next month in the Environment Committee to reduce or eliminate the state excise and petroleum gross earnings taxes on environmentally friendly biodiesel fuel, as well as providing state help for the local production of such fuels.

"It's time for Connecticut to join the 21st century and start encouraging the use of environmentally friendly biodiesel fuel while cutting taxes and helping state businesses at the same time," said Sen. Meyer, who is vice-chairman of the Environment Committee. "There are 16 states in America that currently offer such tax and investment incentives for biodiesel use and production. If Arkansas and Iowa can do it, so can the wealthiest state in the nation."

"It is critical that we as a state support an energy policy that moves us away from dependence on other countries and finite fossil fuels and moves us toward renewable, environmentally responsible energy sources that we can supply right here," Rep. Heinrich said. "Biodiesel offers us these benefits. Plus, this legislation will help Connecticut support a new industry in the region which translates to new jobs. It is a win-win all around."

"This bill begins the process of reducing our reliance on fossil fuels, and it's critical to the United States in helping to formulate a policy that reduces our dependence on foreign sources of oil," Rep. Widlitz said. "It also complements efforts to help reduce greenhouse gas emissions, such as the work of the Regional Greenhouse Gas Initiative, of which Connecticut is one member and which just signed a multi-state compact on December 20 to reduce carbon dioxide emissions."

Biodiesel fuels are conventional petrodiesel fuels that typically include anywhere from
2 percent to 20 percent vegetable oil (i.e. soybean oil), animal fat or waste grease. Diesel engine automobiles, trucks, buses, heavy construction equipment and power generators can all run cleaner on biodiesel fuel with no retrofitting required.

According to the U.S. Environmental Protection Agency, biodiesel fuels reduce the emission of exhaust hydrocarbons (a contributing factor to the formation of smog and ozone) by an average 67 percent when compared to typical petrodiesel emissions, and poisonous carbon monoxide emissions are reduced by an average 48 percent. Particulate matter emissions (a human health hazard) are reduced to about 47 percent of petrodiesel emissions, and carbon dioxide emissions are reduced by up to 78 percent.

To broaden the use of such biodiesel fuels, the proposed legislation (which will be introduced on or before February 10) calls for Connecticut to eliminate the 26 cents per gallon state excise tax on all biodiesel fuels that contain blends of 49.9 percent or greater.
On blends less than 49.9 percent, the excise tax would be proportionate: for example, an 80/20 blend of 80 percent petrodiesel and 20 percent biodiesel would have a state excise tax of 20.8 cents per gallon. The legislation also calls for a similarly proportionate reduction of the state gross earnings tax - now 5.8 percent - on the sale of biodiesel. For example, that 80/20 blend would be taxed at 4.64 percent.

The legislation also calls for the creation of a state "renewable fuels standard" that would require all Number 2 clear and dyed diesel fuel and Number 2 home heating oil to contain at least 2 percent biodiesel fuel by January 1, 2007, contingent on available production capacity. To help ensure that capacity, the legislation directs the state help local businesses secure the necessary financing to build biodiesel production facilities.

BIODIESEL QUICK FACTS: (Source: OLR Reports 2005-R-0904 and 2005-R-0788)

• 16 states currently have biodiesel tax subsidies for the production and sale of biodiesel fuel: Arkansas, Delaware, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Missouri, Mississippi, Montana, North Dakota, Oklahoma, South Dakota and Washington
• The University of Connecticut uses recycled cooking oil - a form of biodiesel fuel - to power a campus shuttle bus.
• Eastern Connecticut State University is conducting a pilot project whereby an 80/20 blend of biodiesel is being used to power a 100-horsepower boiler for the 2005-2006 heating season.
• Biodiesel is nontoxic, produces less skin irritation than soap and water, degrades four times faster than conventional diesel, and has a flash point significantly higher than conventional petrodiesel, making it safer to store and handle.
• A March 2005 UConn study found Connecticut could save $29 million or more in averted health care costs by switching to biodiesel fuel use for space heating and heavy vehicle use.