* McCain, Inhofe move to restrict spending in bill
* Bipartisan group plans fight when bill hits Senate floor
* Grassley blames 'Big Oil' for biofuels backlash
By Roberta Rampton and Susan Cornwell
WASHINGTON, July 17 U.S. senators who support
the Pentagon's push to expand its use of biofuels said they have
a plan to answer critics who argue the fuel is far too expensive
to help develop at a time when the military faces massive cuts.
The battle on Capitol Hill comes as the U.S. Navy's "Great
Green Fleet" prepares to run military exercises in the central
Pacific that will, on Thursday, feature its first operational
test of biofuels.
The U.S. military is the world's largest single buyer of
oil. The Obama administration has argued "Green Fleet" spending
on biofuels could help boost production to commercial levels,
eventually lowering prices for alternatives to oil, and reducing
dependence on supplies from the Middle East.
For Thursday's demonstration project, the Navy paid more
than $26 per gallon for the fuel, made from renewable sources
like algae and chicken fat, a $12-million outlay that sparked
Republican critics of the biofuel plan, led by senators John
McCain and James Inhofe, found enough support within the Senate
Armed Services Committee in May for two proposals that could
limit additional spending.
The measures would stop spending on fuels that cost more
than conventional fuels, and prevent spending on refineries that
would help scale up production of still-experimental fuels. They
were added to a bill authorizing defense programs in 2013.
'SUBSTANTIVE DEBATE' AHEAD
But "Green Fleet" supporters are fighting back.
"We have bipartisan support to undo the work of the
committee," said Senator Mark Udall, a Democrat from Colorado
who is leading the charge.
When the defense authorization bill reaches the Senate
floor, Udall said biofuels supporters may try to amend it to
expressly authorize the Navy to develop biofuels to power ships
and aircraft - or they could hold a vote to remove the McCain
and Inhofe provisions.
"It will be a substantive debate," Udall told Reuters. "I
think the story, when it's told, will generate wide support" for
defense spending on renewable energy, he said.
Senators Susan Collins, a Republican, and Jeanne Shaheen, a
Democrat, wrote an opinion piece in Politico earlier this week
signaling their support for overturning the Armed Services
panel's biofuels changes.
"We hope to correct that short-sighted mistake when the bill
reaches the Senate floor," Shaheen and Collins wrote.
Senator Carl Levin, the Democratic chairman of the Armed
Services Committee, said he also hopes to see a change.
"They are going to try to put it back, which is great. I'm
all for it," Levin told reporters outside the Senate.
A new six-figure television advertising campaign by military
veterans is targeting lawmakers in six states - starting with
Senator Rob Portman in Ohio - who voted to restrict military
spending on biofuels.
The campaign is organized by the Truman National Security
Project, a left-leaning advocacy group on military, energy and
foreign policy issues.
MCCAIN: FIGHT WILL CONTINUE
McCain told Reuters he knows colleagues who support biofuels
will try to overturn his spending curbs.
"But we will continue to fight," McCain said. "I was just
reading, it's the cost of one destroyer - $1.8 billion extra -
they want to spend on this green technology.
"The fact is, I just do not believe that we need to spend
that kind of money on it," McCain said.
Inhofe wrote to President Barack Obama on Wednesday urging
him to push Congress to repeal restrictions on military spending
on fuels made with coal or natural gas, a measure that was part
of a 2007 energy law.
That would "introduce more competition" into the military
fuels market and bring down costs, Inhofe said in his letter.
Republican Senator Charles Grassley said the military should
be allowed to continue its "investment" so the United States can
develop more alternative fuels.
"Nobody would doubt that there's a lot of money maybe wasted
in the process of research, but there's more good comes out of
it than bad," Grassley told Reuters.
Grassley, known for his backing of ethanol made from corn
grown in his home state of Iowa, said he believes the powerful
U.S. oil industry is behind a series of efforts to pare back
government support for biofuels.
House Republicans have proposed cutting Agriculture
Department programs aimed at developing new types of biofuels,
and are also questioning a federal mandate that ensures refiners
blend gasoline with ethanol and other biofuels.
"It's Big Oil. They don't want any competition. They want to
control everything," Grassley said.