ContributorNetwork - Several U.S. senators from Midwest states, as part of a bipartisan coalition, have introduced the "Domestic Energy Promotion Act of 2011," a bill that would slowly reduce the tax credit incentives for ethanol -- but still extend them for another five years, reports Reuters. Currently, the United States has an ethanol tax credit officially named the Volumetric Ethanol Tax Credit (VEETC), which has a 45 cent-per-gallon incentive. However, VEETC expires at the end of this year and several senators representing oil-producing states are, according to The Hill, pushing for the end of VEETC in the form of a separate bill which would abruptly stop the incentives instead of phasing them out. The Domestic Energy Promotion Act of 2011 is being spearheaded by Sen. Charles Grassley, a Republican from Iowa, which is currently the largest ethanol-producing state in the entire nation. Grassley introduced the bill as a response to senators, including Dianne Feinstein (D-Calif.) and Tom Coburn (R-Okla.), who wanted the tax credit to be cut completely after this year. The bill would reduce the ethanol tax credit in 2012 and 2013 to 20 cents and 15 cents, respectively. The rates between 2014 and 2016 would be a variable tax incentive and dependent on the price of crude oil, in which ethanol is added in order to make an ethanol-oil blend gasoline product. Currently, the United States' ethanol industry receives billions of dollars in tax incentives in order to help with the costs of ethanol production. Sen. Grassley spoke on the Senate floor and addressed the senators who were pushing for the end of ethanol tax credits. According to Agriculture.com, Grassley said: "Biofuels are not the only form of energy that receives incentives or supportive policies from the federal government. How about the incentives for wind, oil, natural gas, nuclear, and geothermal? If the Senate intends to consider reforms to biofuels incentives, it should be in the context of a comprehensive review of all energy tax incentives. This bill is meant to serve as a first step in the process." In addition to wanting to end the ethanol tax incentives, senators from oil-producing states are also campaigning to end an import tax on foreign ethanol imported to the United States. The Domestic Energy Promotion Act of 2011 is being backed by several influential ethanol and agriculture support organizations, including the National Corn Growers Association, the American Coalition for Ethanol, Growth Energy and the Renewable Fuels Association.Rachel Krech provides an in-depth look at current environmental issues and local Chicago news stories. As a college student from the Chicago suburbs pursuing two science degrees, she applies her knowledge and passion to both topics to garner further public awareness.

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