March 8, 2015

Jeb Bush stakes out contrary position on energy subsidies in Iowa

Jonathan Martin |

DES MOINES – Jeb Bush said Saturday that he wanted to phase out federal benefits for renewable fuels and wind energy, using an agricultural summit here to side with his party’s free-market advocates over the industry groups who staged the forum.

Mr. Bush’s language was gentle – he praised the use of ethanol in gasoline and said he supported the expansion of alternative energy sources such as wind – but he left no doubt he wanted to get rid of a pair of benefits that are widely supported by Iowa’s political and industry leaders.

Just hours after Gov. Terry E. Branstad of Iowa kicked off the gathering in an event hall on the state fairgrounds by exclaiming, “Don’t mess with the R.F.S.!” Mr. Bush said the Renewable Fuel Standard should eventually be eliminated. Mr. Bush praised the law, which requires that biofuels like corn-derived ethanol be mixed with gasoline, saying it “has worked, for sure” and noting the increase in production and declining reliance on foreign oil.

But Mr. Bush said the industry’s success would obviate the need for a subsidy. “Ultimately, whether it’s ethanol or any other alternative fuel, renewable or otherwise, the markets are ultimately going to have to decide this,” the former Florida governor said.

As for when the fuel requirement should be sunset, Mr. Bush suggested it would not be any earlier than in what would be his second term as president – “2022 or sometime in the future,” he said.

Mr. Bush was just as clear about his opposition to the wind production tax credit, a popular benefit in a state where many farms are now dotted with massive wind turbines.

He was clearly ready for the question, citing a Florida-based wind energy giant that believes the success of the wind industry would eventually render the tax break unnecessary. “It’s now competitive and I think it ought to be phased out over a period of time,” said Mr. Bush, adding that it should be done “over a three-to-five year period.”

The audience of about 1,000 Iowans appeared neither pleased nor angry by his answers – they remained silent.

But Mr. Bush’s comments were striking at an event funded by the very agricultural interests most invested in sustaining the federal benefits. (An ad promoting the Renewable Fuel Standard appeared on a pair of flat-screens on stage in between speakers earlier in the day).

His positions, however, will please another important audience far away from the Iowa State Fairgrounds. Some of the Republican Party’s most sought-after donors – including free-market groups such as the Club for Growth, as well as the Koch brothers and the oil industry – are opposed to one or both of the federal benefits Mr. Bush came out against.

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