Broad Coalition Opposes State Biodiesel Fuel Mandate; Businesses, Consumers Will See Higher Fuel Prices and Tight Supplies

Apr 25, 2001, 01:00 ET from Minnesota Trucking Association

    ST. PAUL, Minn., April 25 /PRNewswire/ -- Higher diesel fuel prices, loss
 of fuel sales to surrounding states and possible fuel supply shortages will be
 the result if the state Legislature mandates the use of experimental
 "biodiesel" oils in all diesel fuel sold in Minnesota.  This is the analysis
 of a broad-based coalition of state businesses and industry trade groups that
 voiced their opposition to a proposed biodiesel mandate today in St. Paul.
     The coalition opposed to the proposed mandate is comprised of
 representatives from Minnesota's trucking, airline, railroad, construction,
 delivery service, general commuter and fuel supply and delivery industries and
 advocacy organizations.
     The target of the coalition's opposition is legislation under
 consideration in the Minnesota Legislature that would mandate mixing soybean
 oil or vegetable oil derivatives, known as "biodiesel oil," in all diesel fuel
 sold in Minnesota beginning in 2002, and expanding the mandate in 2006.
     "Biodiesel fuels have a promising future, but mandating the use of
 biodiesel is not the way to develop the industry," said John Hausladen,
 president of the Minnesota Trucking Association.  "The serious negative
 economic impacts a state mandate would have on consumers, main street
 businesses, farmers and other state industries should convince the state
 Legislature to reject this proposal."
     A recent economic study found that a Minnesota biodiesel mandate would
 increase the cost of diesel fuel sold in the state by 2-6 cents per gallon,
 costing diesel fuel consumers and suppliers $16-48 million per year.  The
 study also found that a state biodiesel mandate could increase the cost of
 airline fuel in the state by up to 9 cents per gallon.  Dr. C. Ford Runge,
 Distinguished McKnight Professor of Applied Economics and Law and adjunct
 professor at the University of Minnesota's Hubert H. Humphrey Institute of
 Public Affairs and Department of Forest Resources, conducted the study.
     "The increased cost of biodiesel fuel will be passed on to all consumers
 of transportation services, affecting farmers, transit users, grocery store
 owners and customers, manufacturers, you name it," Hausladen said.  "Some
 trucking contracts carry provisions calling for automatic fuel surcharges when
 the cost of fuel rises certain amounts and the cost of a biodiesel mandate
 could trigger those surcharges.  A state biodiesel mandate really amounts to a
 hidden tax on all segments of the economy that rely on diesel-powered
 transportation."
     Consumer and railroad representatives expressed similar concerns about
 higher prices and tight supplies.
     "Instituting yet another fuel requirement, like a biodiesel mandate, will
 not only increase the cost for diesel fuel, it will also impact the cost of
 every gallon of gasoline sold in Minnesota in the long run," said Daron Van
 Helden, spokesman for AAA Minnesota/Iowa, representing more than
 400,000 Minnesota motorists.  "At a time when fuel costs are approaching
 record levels, we cannot afford the negative cost impacts a biodiesel mandate
 would impose on all Minnesota fuel users."
     "Under a Minnesota biodiesel mandate, maintaining an adequate supply of
 diesel fuel at a competitive price is a major concern for the railroad
 industry," said John Bergene, assistant director of public affairs for
 Canadian Pacific Railway.  "We would have to seriously consider securing
 alternative sources of fuel outside of the state."
     Members of the coalition opposed to the biodiesel mandate include:
 Minnesota Trucking Association, Northwest Airlines, Canadian Pacific Railway,
 AAA Minnesota/Iowa, Sun Country Airlines, Koch Petroleum Group, Burlington
 Northern Sante Fe Railway, United Parcel Service, MN Service Station Assoc.,
 MN Petroleum Council, Fed Ex, Cummins North Central, Yellow Freight Company,
 National Assoc. of Truck Stop Operators, MN Waste Haulers Assoc., MN Utility
 Contractors Association, National Solid Wastes Management Assoc., Interstate
 Detroit Diesel, Marathon Ashland Petroleum LLC, Ryder Trucks.
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X42563646
 
 

SOURCE Minnesota Trucking Association
    ST. PAUL, Minn., April 25 /PRNewswire/ -- Higher diesel fuel prices, loss
 of fuel sales to surrounding states and possible fuel supply shortages will be
 the result if the state Legislature mandates the use of experimental
 "biodiesel" oils in all diesel fuel sold in Minnesota.  This is the analysis
 of a broad-based coalition of state businesses and industry trade groups that
 voiced their opposition to a proposed biodiesel mandate today in St. Paul.
     The coalition opposed to the proposed mandate is comprised of
 representatives from Minnesota's trucking, airline, railroad, construction,
 delivery service, general commuter and fuel supply and delivery industries and
 advocacy organizations.
     The target of the coalition's opposition is legislation under
 consideration in the Minnesota Legislature that would mandate mixing soybean
 oil or vegetable oil derivatives, known as "biodiesel oil," in all diesel fuel
 sold in Minnesota beginning in 2002, and expanding the mandate in 2006.
     "Biodiesel fuels have a promising future, but mandating the use of
 biodiesel is not the way to develop the industry," said John Hausladen,
 president of the Minnesota Trucking Association.  "The serious negative
 economic impacts a state mandate would have on consumers, main street
 businesses, farmers and other state industries should convince the state
 Legislature to reject this proposal."
     A recent economic study found that a Minnesota biodiesel mandate would
 increase the cost of diesel fuel sold in the state by 2-6 cents per gallon,
 costing diesel fuel consumers and suppliers $16-48 million per year.  The
 study also found that a state biodiesel mandate could increase the cost of
 airline fuel in the state by up to 9 cents per gallon.  Dr. C. Ford Runge,
 Distinguished McKnight Professor of Applied Economics and Law and adjunct
 professor at the University of Minnesota's Hubert H. Humphrey Institute of
 Public Affairs and Department of Forest Resources, conducted the study.
     "The increased cost of biodiesel fuel will be passed on to all consumers
 of transportation services, affecting farmers, transit users, grocery store
 owners and customers, manufacturers, you name it," Hausladen said.  "Some
 trucking contracts carry provisions calling for automatic fuel surcharges when
 the cost of fuel rises certain amounts and the cost of a biodiesel mandate
 could trigger those surcharges.  A state biodiesel mandate really amounts to a
 hidden tax on all segments of the economy that rely on diesel-powered
 transportation."
     Consumer and railroad representatives expressed similar concerns about
 higher prices and tight supplies.
     "Instituting yet another fuel requirement, like a biodiesel mandate, will
 not only increase the cost for diesel fuel, it will also impact the cost of
 every gallon of gasoline sold in Minnesota in the long run," said Daron Van
 Helden, spokesman for AAA Minnesota/Iowa, representing more than
 400,000 Minnesota motorists.  "At a time when fuel costs are approaching
 record levels, we cannot afford the negative cost impacts a biodiesel mandate
 would impose on all Minnesota fuel users."
     "Under a Minnesota biodiesel mandate, maintaining an adequate supply of
 diesel fuel at a competitive price is a major concern for the railroad
 industry," said John Bergene, assistant director of public affairs for
 Canadian Pacific Railway.  "We would have to seriously consider securing
 alternative sources of fuel outside of the state."
     Members of the coalition opposed to the biodiesel mandate include:
 Minnesota Trucking Association, Northwest Airlines, Canadian Pacific Railway,
 AAA Minnesota/Iowa, Sun Country Airlines, Koch Petroleum Group, Burlington
 Northern Sante Fe Railway, United Parcel Service, MN Service Station Assoc.,
 MN Petroleum Council, Fed Ex, Cummins North Central, Yellow Freight Company,
 National Assoc. of Truck Stop Operators, MN Waste Haulers Assoc., MN Utility
 Contractors Association, National Solid Wastes Management Assoc., Interstate
 Detroit Diesel, Marathon Ashland Petroleum LLC, Ryder Trucks.
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X42563646
 
 SOURCE  Minnesota Trucking Association