U.S. Senate members will vote today on legislation that includes an amendment from Sen. Tom Coburn, R-Okla., to end the 45-cent-per-gallon Volumetric Ethanol Excise Tax Credit and 54-cent ethanol import tariff on June 30. Coburn introduced the amendment on June 9, leaving ethanol industry representatives and Midwestern senators just a few days to rally their supporters to defeat the measure. The Renewable Fuels Association, Growth Energy and the American Coalition for Ethanol issued emails to their members, urging them to contact their respective senators to vote against the bill while several senators took to the Senate floor to voice their disapproval of the amendment.

“The attack on domestic energy is really remarkable,” said Sen. Chuck Grassley, R-Iowa, during remarks made on the Senate floor on June 13. “We shouldn’t be fighting each other over domestic energy sources. We should be fighting OPEC and foreign dictators and oil sheiks that hold our economy hostage.”

Grassley reminded his fellow senators that VEETC was established to help ethanol producers compete with the oil industry and pointed out that the petroleum industry continues to be privileged by its own stable of incentives. Coburn has the support of the National Petrochemical and Refiners Association as well as a number environmental and livestock producer groups, who sent a letter to senators on June 13, asking them to approve the repeal of ethanol support. Grassley noted in his floor statement, however, that many of the NPRA’s members do not blend ethanol and therefore are not subject to VEETC. “It’s easy to advocate repealing something when you don’t benefit from it,” he said. “It’s even easier to advocate for its repeal when doing so would undercut your only competition.”

Grassley then introduced a letter submitted to Senate leaders by the Society of Independent Gasoline Marketers of America in support of the continuation of an ethanol blender’s credit. In the letter, SIGMA states that its members have found VEETC to be “an extremely useful tool in helping the nation’s fuel marketers and chain retailers deliver fuels to the market at a competitive price.” The group also stated that the credit provides long-term price competitiveness for ethanol-blended fuels and assures retailers who install biofuels infrastructure that their investments will not be wasted. “Simply put, SIGMA opposes recent moves to prematurely or abruptly end the subsidies without any consideration for future fuel and fuel-delivery costs,” the group stated in the letter.

Ethanol groups and several senators, including Grassley, argue that repealing ethanol incentives will result in a tax increase and higher gas prices for consumers. ACE Executive Director Brian Jennings said his group is doing everything it can to defeat Coburn’s amendment. “We issued a call-to-action to all ACE members Friday morning, sent a more targeted call-to-action Monday morning focusing on key Senators who needed additional pressure, and we’ll issue another blanket call-to-action Tuesday before the vote,” he said, adding that he feels the industry has a “reasonably good chance” of defeating the measure.

Tom Buis, CEO of Growth Energy, said his group will focus on working directly with members of the Senate prior to the vote. He was less willing to make a prediction on the outcome, stating, “We’ll have to see what happens on the Senate floor.”

The Senate is expected to vote on the amendment at 2:15 EST.

Meanwhile, Sens. John Thune, R-S.D., and Amy Klobuchar, D-Minn., began floating legislation on June 13 that agrees to end the current VEETC on July 1, but would replace it with a variable tax credit at a reduced rate to ensure support for ethanol in the instance of low oil prices. Beginning July 1, ethanol blenders would be eligible to receive a tax credit of 30 cents per gallon when oil prices are $50 per barrel or less. When oil prices are $90 per barrel or more, ethanol blenders would receive no incentive. The ethanol groups and the National Corn Growers Association have endorsed the bill, as have 13 other senators.