Smooth Senate path for fivefold biofuels boost

By Charles Abbott

WASHINGTON (Reuters) - A proposal for a fivefold increase in U.S. use of biofuels like ethanol can be added to the new farm law with little or no Senate opposition, two senior Democrats said on Tuesday.

Majority Leader Harry Reid said the amendment, setting a target of annual use of 36 billion gallons of biofuels by 2022, could be adopted on a voice vote. Agriculture Committee chairman Tom Harkin said "there is broad support" for the mandate.

Senators will pass the five-year, $286 billion farm bill "no later than next week," said Harkin, Iowa Democrat. It will be early 2008 when the House and Senate send a final version to the White House, he said.

The fuel ethanol industry has boomed since a 2005 law set a requirement for use of 7.5 billion gallons a year of renewable fuels by 2012. A trade group says production will exceed 9 billion gallons in 2008.

Backers say a larger "renewable fuels standard" will encourage development of cellulose, found in grasses and woody plants, as a feedstock. The 36 billion-gallon mandate proposed by New Mexico Republican Pete Domenici reserves 22 billion gallons for "advanced biofuels."

Lawmakers included the 36 billion-gallon mandate in energy bills that face an uncertain future. Less than two weeks remain in this year's congressional session.

During a telephone news conference, Harkin said he would like to build a veto-proof majority for the farm bill -- "That's what I've been shooting for."

The Bush administration has threatened a veto of the Senate bill as it now stands. It says the new farm law should tighten farm subsidy rules, forego any tax increase or increases in crop support rates and provide "revenue protection" for grain, cotton and soybean growers.