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ACE urges support for STB Reauthorization Act of 2014

ACE Executive Vice President Brian Jennings urges the leaders of the Senate Commerce Committee to support S. 2777

Brian Jennings, Executive Vice President of the American Coalition of Ethanol (ACE) has sent a letter to the leaders of the Senate Commerce Committee urging support for S. 2777, the Surface Transportation Board Reauthorization Act of 2014.

Jennings says in the letter, (which can be read here) “U.S. corn-based ethanol is the most economical transportation fuel in the world, and given its favorable blending economics and the Renewable Fuel Standard, ethanol is capable of comprising much more than its 10 percent share of U.S. gasoline use today.  But in order to do that, reliable and timely rail service is critical.”

“Unfortunately, during most of 2014, railroads have failed to provide reliable and timely service.  Logjams built-up this winter due to extreme cold and snow which reduced the speed and size of trains, and all year long it has appeared that railroads have provided favorable service to crude oil shipments at the expense of ethanol and agricultural commodities….”

“Many of ACE’s ethanol producer members are captive shippers and have reported chronic rail service disruptions this year, such as delayed tank car arrivals, insufficient tank cars received for ethanol off-take, loaded cars parked and overdue for power to arrive, and turn-around times that have doubled.  As a result, storage tanks at ethanol plants are full and many of our members have been forced to slow production or worse yet, shut down operations at a time when demand for ethanol is on the rise because of its low price and clean octane benefits.  To cope with unreliable rail service, some biorefineries have invested in additional storage or considered adding unit train capability, but it is hard to justify those investments without meaningful commitment by the railroads that service will improve.  Moreover, we are concerned that a record harvest of corn and soybeans this fall could make a bad situation on the rails even worse.”

“While S. 2777 does not comprehensively or immediately tackle all these problems, your legislation is an important step in the right direction because it will allow the STB to launch its own investigations and establish shorter timelines for the review of cases.” 

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