Conservationists support the use of renewable energy, but they also recognize that some renewable fuels may have serious environmental impacts. For instance, ETBE (ethyl tertiary butyl ether), a gas additive made from ethanol, may contaminate groundwater in the same manner as MTBE (methyl tertiary butyl ether). In addition, ethanol may inhibit the breakdown of other, more toxic components in gasoline and increase the spread of benzene and other hydrocarbons around leaking storage tanks.

The Senate energy bill (S. 517) exempted renewable fuels and renewable fuel additives from federal and state product liability protections. Under this loophole, manufacturers and refiners could not be held accountable for the harm caused by their defective products. Taxpayers and affected communities would be forced to bear the costs of the adverse health and environmental impacts of renewable fuels. Conservationists argued that this provision would eliminate an important disincentive to pollute and set a dangerous precedent for environmental policy, both at the state and federal levels.

During Senate floor consideration of the energy bill, Senators Barbara Boxer (D-CA) and Dianne Feinstein (D-CA) introduced an amendment to close this loophole by ensuring that renewable fuels are not subject to a lesser liability standard than other motor vehicle fuels or fuel additives. On April 25, 2002, Senator Harry Reid (D-NV) introduced a motion to table the Boxer amendment. The motion passed by a 57-42 vote (Senate roll call vote 87). NO is the pro-environment vote. The final Senate bill included the liability waiver for renewable fuels. At press time the House and Senate conference on the energy package had not produced a final bill.