US Senators Jim Bunning (R-KY) and Barack Obama (D-IL) have re-introduced a piece of legislation that would help create the infrastructure needed for large-scale production of Coal-to-Liquids (CTL) fuel in the US.
The proposed “Coal-To-Liquid Fuel Promotion Act of 2007” is based on the bill first introduced by Senators Bunning and Obama last spring and expands tax incentives, creates planning assistance, and develops Department of Defense support for a domestic CTL industry.
The Coal-to-Liquid Fuel Promotion Act of 2007 enables the Department of Energy to provide loan guarantees for construction and direct loans for the planning and permitting of CTL plants. Loan guarantees will encourage private investment and planning loans will help companies prepare a plant for construction.
This legislation also will expand investment tax credits and expensing provisions to include coal-to-liquids plants, extend the Fuel Excise Tax credit, and expand the credit for equipment used to capture and sequester carbon emissions.
Finally, the bill provides the Department of Defense the funding and authorization to purchase, test, and integrate these fuels into the Strategic Petroleum Reserve and military fuel supplies.
The Senators also announced they will form the Senate Coal-to-Liquid Fuel Caucus to help drive the legislation forward.
Both Kentucky and Illinois have massive coal reserves. Obama also sponsored the just-introduced BioFuels Security Act of 2007 that would institute a 60 billion gallon Renewable Fuel Standard by 2030. (Earlier post.)