Defense authorization bill could cut military biofuel initiatives

In mid-May the U.S. House of Representatives approved a $642 billion defense authorization bill that includes provisions to undermine military efforts to reduce dependence on foreign oil. According to information provided by the Pew Charitable Trusts, the language of the bill would prohibit the U.S. Department of Defense from pursuing its public-private initiative to develop cost-competitive, commercially available advanced biofuels. A memorandum of understanding (MOU) for the initiative was signed by the DOD, USDA and U.S. DOE in 2011. The initiative would require a $70 million funding commitment in fiscal year 2013. The legislation would also repeal Section 526 of the 2007 energy bill, which stipulates that if the DOD buys alternative fuels, then those fuels cannot emit more carbon than conventional petroleum.

The Senate Armed Services Committee is set to take up their version of the legislation this week, and it is possible the same type of amendments could be included in its version of the bill. According to Pew’s Director of Clean Energy Phyllis Cuttino, amendments related to the repeal of Section 526 and the public-private initiative could be introduced during committee markup this week, or during a floor debate on the bill later in the year.

According to Cuttino, Section 526 provides investors with policy certainty. Private investors, she said, want to invest in their money in areas where they are likely to see returns. If they see there is uncertainty about whether something is going to be pursued, they generally don’t invest, she added. The MOU also relates to investment.

This isn’t the first time the MOU and Section 526 have been challenged. Cuttino noted that there was a reprogramming request for the MOU last year, which was turned down. In the House, a repeal of Section 526 was attached to five must-pass bills last year, including four appropriations bills and the defense authorization bill. While the Senate was silent on the issue, Cuttino said once the bill reached conference committee, the Section 526 repeal was one of the last two issues resolved before the legislation went to the floor. “Clearly, it was pretty contentious,” she said. “This year, obviously the Republicans in the House have doubled down on a repeal, because of just adopting it by voice vote they’ve had two roll call votes both on the MOU and the repeal of Section 526.” It appears likely that Sen. James Inhofe, R-Okla., and Sen. John McCain, R-Ariz., will introduce similar measures in the Senate.

Cuttino also noted that the MOU and Section 526 are in different places in terms of support. For example, some senators seem likely to support the MOU, but also want to see a repeal of Sec. 526. She also said that support isn’t necessarily divided down party lines. Rather, support seems to hinge more on whether a particular lawmaker’s state produces coal or oil. However, she also stresses that it’s impossible to tell what will happen as the bill moves through committee markup and floor debate.

One clearly positive indication is that the Department of Defense and the Navy have made a strong case for the support of these initiatives. It’s also been very heartening that Airlines of America and individual airlines have stepped up and indicated they are the next consumer for advanced biofuels, showing there is a market for this type of fuel and technology, Cuttino said.

Even if amendments repealing Section 526 and eliminating funding to the MOU do get signed into law as part of this bill, Cuttino stressed that there is a core of members in both the House and Senate who are very supportive of the DOD’s energy programs and are likely to take up the matter in future legislative sessions.

On May 22 Rep. Adam Smith, D-Wash., participated in a media call hosted by The Truman National Security Project to help draw attention to the issue. “These are important energy issues,” Smith said. “They are pretty important issues and they are not getting as much attention as they could.” Regarding the House amendment that seeks to repeal Section 526, Smith said “the problem with that is that’s a short-term look at a long-term problem.” We are too dependent on foreign oil, he emphasized, and the price of oil keeps going up. The DOD spends more money on energy than anyone any other group in the U.S., and they need alternatives, he said. “You are not going to get alternatives if you don’t take some time to develop them,” Smith said, “and that would severely restrict the ability of the Department of Defense to purchase alternative sources of fuel.”