Inhofe cited a Defense Department report that estimated the Navy's biofuels initiative could cost an extra $1.8 billion a year, but Navy officials have said the money they're spending now is on research and development and that the service wouldn't purchase the fuels for regular use until the cost was competitive.
A statement from the Navy issued to The Oklahoman on Wednesday states the $1.8 billion figure “is a fabrication. It was taken from a report that did not use realistic data or take into account Navy's commitment regarding biofuel purchases for operations.”
“First, the projections in the report assume oil prices won't be higher in 2020, and that biofuel costs won't go down. History and experts tell us that oil prices are more likely to rise, and because of advances in technology and economies of scale the price of biofuel has already dropped.
“More to the point, the Navy has taken the well-known and much-publicized position that it will only purchase operational quantities of biofuel blends when they are competitive with petroleum, period. Future operational purchases of biofuel must be cost competitive with conventional fuels. We simply cannot afford to do it otherwise and will not do it.”
The Senate Armed Services Committee recently passed an amendment pushed by Inhofe and Sen. John McCain, R-Ariz., to limit funding for alternative fuels, though research and development would still be allowed.