STATEMENT BY THE

ILLINOIS SOYBEAN ASSOCIATION

By Darryl Brinkmann

For SENATOR PETER FITZGERALD

HEARING ON BIOFUELS

April 18, 2000

Good morning. I am Darryl Brinkmann, a soybean and corn producer from Carlyle, Illinois. I am past President of the Illinois Soybean Association and currently represent the state on the American Soybean Association (ASA) Board of Directors. I also serve on the Board of Directors of the National Biodiesel Board (NBB).

I am pleased to be here today and commend you, Senator Fitzgerald, for holding this hearing on biofuels. I am going to shift the focus a bit from our earlier panel and use this opportunity to discuss biodiesel and some of the issues our industry is working on.

Senator Fitzgerald, I know you understand biodiesel, but for the record, biodiesel is a cleaner burning fuel for diesel engines. It is produced from renewable resources, such as soybean oil. Biodiesel is an ideal alternative fuel because it operates in diesel engines just like petroleum diesel and requires little or no modifications, while maintaining the payload capacity and range of petroleum. Because its chemical characteristics are very similar to petroleum diesel, biodiesel blends well at any level. The most commonly used blend is a 20% biodiesel, 80% diesel blend - B20. One of the reasons it is the most commonly used blend is due in large part to legislation sponsored and shepherded through Congress in 1998 by my Congressman, John Shimkus.

Congressman Shimkus' bill amended the Energy Policy Act (EPACT) of 1992 to allow federal and state fleets to earn credit under this program by using B20. This major change in law has resulted in record growth of biodiesel use and I believe we are just beginning to take advantage of the potential of this market. So, thank you Mr. Shimkus and other Members of Congress in the room for your strong support of this effort and of our industry.

Biodiesel is simple to use, renewable, domestically produced and readily available.

Other advantages of biodiesel include superior lubricity for smoother operation and reduced engine wear and a high flash point, making it safer to store and handle.

The use of biodiesel in a conventional diesel engine results in substantial reduction of unburned hydrocarbons, carbon monoxide, and particulate matter compared to emissions from diesel fuel. Pure biodiesel does not contain sulfur and therefore reduces sulfur dioxide exhaust from diesel engines virtually to zero.

Of course, there are other reasons to use more biodiesel right now. With agriculture prices at record lows and petroleum prices approaching record highs, it is clear that more can be done to utilize domestic surpluses of renewable oils, such as soybean oil, while enhancing our energy security. Because biodiesel can be used with existing petroleum infrastructure, it provides an immediate opportunity for addressing our dependence on imported petroleum and helping our farm economy.

There are many reasons for our transportation sectors to use more renewable fuels like biodiesel, but there are still hurdles and obstacles to making this a reality. Congressman Shimkus has introduced legislation in the House to amend the Congestion Mitigation Air Quality (CMAQ) program to allow funds in this federal grant program to be used to buy down the cost of biodiesel. The Shimkus bill does not create a new program for biodiesel nor does it earmark funds in the current program for biodiesel. It just levels the playing field for biodiesel to be eligible for funds in the CMAQ program. Senator Bond of Missouri and Senator Johnson of South Dakota have sponsored similar legislation in the Senate, and I know we can count on your support, Senator Fitzgerald, of that bill.

For long-term support of biodiesel, the industry is considering a number of options including a national renewable standard. In other words, all diesel transportation fuels would contain a very small percentage of biodiesel. Some petroleum distributors are already offering a premium diesel that includes a low blend biodiesel additive. For example, Koch Industries is offering a product, U.S. Soy Field Diesel in bulk at over twenty terminal locations across the Midwest. A similar product, Soy Master, is being marketed by Country Energy, a joint venture between Farmland and Cenex/Harvest States. We think this concept has merit and will work with industry to further develop the expansion and use of low blends of biodiesel. An upcoming rulemaking process by EPA which will lower sulphur content in diesel fuel, will necessitate inclusion of a lubricity additive. Because biodiesel contains no sulphur, it could serve as a domestically produced renewable, oxygenated lubricity additive in ultra-low sulphur diesel fuel.

Senator Fitzgerald, we think the future looks bright for biodiesel and with the help of Members of Congress like you and Representative Shimkus we know that many of the current obstacles will soon be opportunities.

Again, I appreciate the chance to talk about several key issues facing the biodiesel industry and look forward to working with you on these matters and others of importance to Illinois soybean producers.

Thank you.