A number of American Congressional leaders are in the process of drafting bills to support the production of liquid coal under the banner of energy independence, according to a report in the New York Times newspaper.

Among the incentives currently moving through Congress and Senate committees are: a tax-credit of 51 cents for every gallon of coal-based fuel sold through 2020 (notably, exactly the same rate as the Volumetric Ethanol Excise Tax Credit), automatic subsidies if oil prices drop below $40 a barrel; and permission for the Air Force to sign 25-year contracts for nearly a billion gallons a year of coal-based fuel.

The New York Times documents intense lobbying by the US coal industry, and notes that the congressional backers of these bills hail largely from coal producing states.

As for bolstering energy security, a recent report from M.I.T suggests that would come at a very high cost. Replacing only 10 percent of American gasoline consumption would cost some $70 billion for the construction of new coal-to-liquid plants.

The full New York Times article, dated 28 May 2007, is available on-line at: http://www.nytimes.com/2007/05/29/business/29coal.html?_r=2&ref=business&oref=slogin&oref=slogin