Cassidy, Bennet Introduce the Waterway LNG Parity Act of 2015

WASHINGTON— U.S. Senators Bill Cassidy, M.D. (R-LA) and Michael Bennet (D-CO) introduced the Waterway LNG Parity Act of 2015. This bipartisan legislation would ensure that excise taxes on liquefied natural gas (LNG) for marine transportation on the inland waterways are levied at a rate consistent with their energy output relative to diesel and gasoline, respectively. LNG is a cheaper, cleaner, domestic energy source and the current financing mechanism for the inland waterways system puts its use at a disadvantage. This legislation would change the inland waterways financing rate to provide equal treatment within the federal tax code.

“It takes about 1.7 gallons of LNG to provide the same amount of energy as a gallon of diesel. Those who use LNG to power marine vessels would have to pay 50 cents in tax for the same amount of energy contained in a gallon of diesel fuel that is only taxed at 29 cents—that doesn’t make sense,” said Dr. Cassidy. “By ensuring equal tax treatment for LNG, it encourages its use and its production—benefiting Louisiana’s economy and workers.”

“Natural gas is a growing part of Colorado’s diverse energy industry, and this bill recognizes the shift to alternative fuels in across transportation technologies,” Bennet said. “Providing parity to LNG for marine transportation – just as we recently did for cars and trucks – creates an opportunity to grow this market and encourages the use of domestically produced natural gas as a cleaner burning transportation fuel.”   

This legislation is supported by many, including:

“NGVAmerica commends Senators Bill Cassidy, M.D. (R-LA) and Michael Bennet (D-CO) for introducing the Waterway LNG Parity Act of 2015. This common-sense legislation would remove another barrier to the greater utilization of clean-burning, low-cost domestic natural gas in the transportation sector by leveling the playing field for the taxation of LNG fuel used in marine vessels operating on inland waterways in the U.S.”- Matt Godlewski, President of NGVAmerica

"LNG has proven to be a viable fuel alternative in the over-the-road market. It's much cleaner, costs less and comes from the U.S. If given the chance to be on parity with diesel, it will prove to be the same in the marine application as well." -Andrew J. Littlefair, President and CEO of Clean Energy Fuels Corp

“In Texas, there is strong interest and activity related to natural gas powered shipping, and we applaud Senators Bill Cassidy, M.D. (R-LA) and Michael Bennet (D-CO) for introducing the Waterway LNG Parity Act of 2015." - Lynn Lyon, President of Energy Connects

“The marine industry holds great promise for increased utilization of clean, affordable, and abundant natural gas.  Eliminating the disparity that currently exists between LNG and diesel fuel for marine use on inland waterways will put the two fuels on a competitive level and be consistent with the equalized tax treatment of LNG and diesel for highway use,” - Scott Salmon, Senior Advisor at the Shell Oil Company

“The U.S, is now the number 1 producer of natural gas in the world, and American businesses and consumers continue to take advantage of low-cost natural gas in the transportation sector.  Blu LNG applaud Senators Bill Cassidy, M.D. (R-LA) and Michael Bennet (D-CO) for introducing the Waterway LNG Parity Act of 2015.” - James Burns, President and CEO of Blu LNG

“Pivotal LNG supports equalizing the tax on liquefied natural gas for inland waterway use. The excise tax for highway use was recently changed to tax LNG at the same rate as diesel. That modification made a huge difference in the trucking industry. Pivotal LNG believes that fuels should compete based on commodity cost and not be disadvantaged by an outdated tax code. The Waterway LNG Parity Act of 2015 addresses this long-standing issue in the maritime industry.”- Steve Cittadine, President, Storage and Fuels, for AGL Resources

“Taxing LNG at a higher effective rate than diesel builds a barrier to using LNG in the marine industry. Tax policy should not penalize cleaner burning and lower carbon LNG. The Waterway LNG Parity Act of 2015 is a vital step to leveling the playing field for LNG.” - Greg Roche, VP Sales and Marketing for Applied LNG

“The United States has the most efficient and robust natural gas transportation system in the world. We support this bill to create additional demand for natural gas, which has the potential to benefit producers nation-wide. Natural gas as a marine fuel has a dual benefit of cleaner air in our harbors and more drilling in western Colorado in the decades to come.” – David Ludlam, Executive Director of West Slope Colorado Oil and Gas Association