In an effort to further reduce U.S. dependence on foreign oil and create a more environmentally-friendly fuel, Sen. Thune (R-S.D.) and I last week introduced legislation that encourages farmers to grow energy crops to make cellulosic ethanol. Like my initiative to promote the development of bio-gas, this legislation diversifies the sources our country can use for energy, which helps stabilize our expanding biofuels industry.

Cellulosic ethanol has always faced a chicken-or-the-egg problem: it’s difficult to start commercial production without a guaranteed supply of biomass, but it’s hard to encourage farmers to grow the biomass unless they know they’ll have a market. This legislation will help resolve that problem by encouraging the construction of biofuel facilities while simultaneously pushing the production of biomass.

The legislation, the Biofuels Innovation Program Act of 2007 provides business planning and assistance matching grants of up to $30,000 for entities and communities interested in developing a project area for producers to begin producing dedicated energy and biomass crops, as well as for attracting or creating a cellulosic biofuels facility.

While the grants help get biofuel plants up and running, assistance will be given to area producers with the transition to growing crops for biomass. We’ll be pushing both areas of development along the same track, providing a boost for the new fuel site and encouraging further development of domestic energy supplies. Celluosic ethanol has shown great potential, but it faces significant hurdles. Our bill will help clear the hurdles and encourage widespread development of biofuel plants.