Coal to Liquid Technology

Bunning talks about CTL energy at the Kentucky Energy Summit.

On April 24^th, 2006 I chaired an Energy Committee hearing on coal-to-liquids fuels. The Committee heard testimony from the Department of Energy on the implementation of provisions of the Energy Policy Act of 2005 and the committee discussed what additional authorizations may be needed. It was clear to me that coal-to-liquid fuel, unlike many other alternative energy sources, did not receive the federal support needed to build expensive and complicated plants necessary to turn domestic coal into transportation fuels.

The bill, which I re-introduced in the 110th Congress with Senator Barrack Obama as the Coal-to-Liquid Fuel Promotion Act of 2007 (S. 155), would create a program, to be led by the Department of Energy and Department of Defense, to plan, finance, test, and purchase coal-to-liquid (CTL) fuels in America . A combination of tax incentives, loan guarantees and long-term purchasing contracts will reduce the risk associated with these multi-billion dollar plants and stimulate private investment, creating a vibrant domestic marketplace for alternative fuels.

Our country needs CTL fuel now to address three challenges facing our economy. First, it will bring down energy prices and cushion us from future supply shocks and disruptions. The United States should do everything it can to diversify our energy portfolio and make sure American families are not stuck with double digit increases in home heating or gasoline bills.

Second, it will provide our military with a secure, domestic fuel source. In a time of war it is essential that our military does not rely on oil from unstable and politically unreliable nations in the Middle East and the rest of the world. CTL fuel can be readily blended into current stocks and will come from domestic coal.

Third, it will create jobs and stimulate growth. Cheaper fuels and electricity will keep our businesses competitive and the construction and operation of these plants will create good, high-paying jobs.

I believe the Federal government should provide incentives for this fuel today. South Africa has used this technology for decades to provide more than one third of its transportation fuel needs and just last month, China announced a more than $100 billion government investment in CTL technology. We cannot afford to fall behind the rest of the world and ignore our addiction to Middle Eastern oil or the high prices our economy could continue to face.