BATON ROUGE, La. -- Governor Kathleen Blanco has signed into law a price control provision to make sure Louisiana motorists don't have to pay an even higher price at the pump because of new alternative fuel requirements, the Associated Press said. The bill (Senate Bill 454) is designed to make sure ethanol-blended gasoline will not have to be sold in the state if it would increase gasoline prices.
In the legislative session that ended last month, lawmakers approved a law requiring the plant-based fuels to be sold once production of the fuels in Louisiana [image-nocss] reaches certain benchmarks. But critics said the new law would significantly boost prices. So, lawmakers in the final hours of the session approved a second measure that sets up a trigger: the alternative fuels will not have to be sold until the price of Louisiana-manufactured ethanol has stayed below the average wholesale price of regular gasoline for 60 days.
A three-member committee with a representative of the Louisiana Farm Bureau Federation, the Louisiana Oil Marketers & Convenience Store Associatio, and a college faculty member will meet every three months to compile numbers and determine whether the state has reached the averages needed for the mandate to begin.
A federal subsidy to lower the price of ethanol will be included in the consideration of the ethanol price.
Lawmakers said the compromise will ensure consumer protection while encouraging a burgeoning ethanol and alternative fuel industry in Louisiana to help farmers find new outlets for their crops. Under the alternative fuels law, 2% of the total gasoline sold in Louisiana will have to be agriculture-based when ethanol production in the state reaches 50 million gallons annually, biodiesel production reaches 10 million gallons each year or production of another alternative fuel reaches 20 million gallons a year.
In Missouri, Gov. Matt Blunt toured the state Wednesday to promote a new law requiring most Missouri gasoline to contain a 10% ethanol blend. The requirement kicks in Jan. 1, 2008, and even then, it applies only when the price of ethanol-blended fuel is equal to or drops below the price of regular gasoline. Premium-grade fuel will be exempt from the requirement.
"This renewable fuel standard benefits consumers, our economy, the environment, and Missouri farmers," Blunt said. "It means Missouri corn fields will be the oil fields of the 21st century."
An ethanol mandate has been one of his priorities since campaigning for governor in 2004.
Supporters say the requirement will be a boon for corn farmers and lessen dependence on foreign oil, but critics say it goes against free-market principles.
Blunt planned to officially sign the bill (HB1270) today.
Effective Jan. 1, 2008, Missouri gas stations would have to sell ethanol-blended fuel whenever its price is equal to or less than the price of regular gasoline. Excluded from the mandate would be fuel for airplanes, premium fuels, bulk transfers between suppliers or specific exemptions by the U.S. Environmental Protection Agency (EPA). The governor and the director of the state Department of Agriculture would also have the authority to waive the requirement. Station owners who don't sell ethanol when required to could face up to one year in jail and a $1,000 fine.
Missouri farmers must own at least 51% of biodiesel plants unless the plant receives 80% of its agricultural product from in state.
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