New federal legislation will help develop North Dakota's coal into clean-burning liquid fuel, promote wind and ethanol power and encourage state efforts to export electricity, Sen. Byron Dorgan and industry officials say.

"Some of the highest-paid jobs, on average, in North Dakota come from the energy sector," Dorgan said. "And this bill, in a wide range of areas … is a big job generator for the future."

Dorgan, who helped write the energy bill, spoke Tuesday at a Basin Electric Power Cooperative event to promote it.

John Dwyer, president of the Lignite Energy Council, said provisions in the legislation make power line construction a more attractive investment. That is important for North Dakota's coal industry, which relies on development of coal-fueled electric power plants to increase the state's coal mining.

"The transmission is kind of the key to further lignite development, and anything that we can do to encourage the building of transmission infrastructure … is significant," Dwyer said.

Dwyer and Dorgan said the legislation includes aid to help research ways to remove mercury from lignite, and tax credits to encourage "clean coal" projects. Among the possibilities, Dorgan said, is using lignite to make diesel fuel that would burn cleanly.

The measure requires increased use of ethanol, which is manufactured from corn, as a fuel additive for gasoline, and a tax credit that will be used for construction of new wind energy projects. The credit, which ends on Jan. 1, 2008, reduces the cost of power that is generated by wind turbines.

North Dakota's Legislature has approved a temporary state tax subsidy for E-85, a vehicle fuel that is 85 percent ethanol and 15 percent gasoline, and the fuel is becoming more widely available in the state. North Dakota's motor fuel tax is 23 cents a gallon, but the subsidy cuts the tax on E-85 to a penny a gallon.

"I'm convinced that we will see more and more ethanol plants built in North Dakota," Dorgan said. "I am anxious to drive up to the pumps, stop at an E-85 pump and say to somebody, 'Fill it up with corn."'