Obama Administration Says No to Oil, Yes to Biofuels

By Susan Jones | January 20, 2012 | 11:48am EST

U.S. Agriculture Secretary Tom Vilsack in Washington, D.C. on Sept. 19, 2011. (CNSNews.com Photo/Penny Starr)

(CNSNews.com) - Two days after President Barack Obama blocked construction of a major oil pipeline, his administration is touting its efforts to expand domestic production of renewable energy.

Agriculture Secretary Tom Vilsack announced Friday that his agency has approved a $25-million conditional loan guarantee to build a 55,000-square-foot biorefinery plant in Iowa.

The Fiberight facility will produce cellulosic ethanol by converting municipal solid waste and other industrial pulps into "advanced biofuels," the news release said.

The project is expected to create 38 jobs and save 16 jobs. By contrast, expansion of the Canada-Texas Keystone XL pipeline would create thousands of jobs; some estimates say as many as 20,000.

"This project is another step the Obama administration is taking to support production of a new generation of renewable fuels, in order to build an active biofuels and biomass production industry in every region of the country," said Vilsack. "Investments in renewable energy create jobs and reduce America's dependence on foreign oil."

The USDA news release notes that Americans import "just over half (60%) of our transportation fuels," and it says the U.S. "can do more to meet the President's goal of reducing our net fuel imports by one-third by 2025."

Proponents of the Keystone XL pipeline agree that the U.S. can do more to reduce fuel imports.

“Until this pipeline is constructed, the U.S. will continue to import millions of barrels of conflict oil from the Middle East and Venezuela and other foreign countries who do not share democratic values Canadians and Americans are privileged to have,” said Russ Girling, TransCanada’s president and chief executive officer, in a statement on Wednesday announcing that his company will reapply for a Keystone XL permit.

At Secretary Vilsack's direction, USDA says it is working to develop the national biofuels industry, producing energy from non-food sources in every region of the country.

USDA says it is “conducting and encouraging research into innovative new energy technologies and processes, helping companies build biorefineries, and supporting farmers, ranchers, and businesses taking risks to pursue new opportunities in biofuels.”

USDA's Biorefinery Assistance Program was authorized by Congress under the 2008 Farm Bill.

Under the conditional commitment, Fiberight must meet specified conditions before the loan guarantee can be completed.

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