The US Department of Agriculture (USDA) recently invited public comment on several proposed rules designed to increase the production of advanced biofuels and the development of biorefineries. The programs are authorized under the Food, Conservation and Energy Act of 2008 (The Farm Bill).
The proposed rules affect the following three renewable energy programs administered by USDA Rural Development:
Biorefinery Assistance Program. The proposed rule will establish guaranteed loan regulations to develop and construct commercial-scale biorefineries and to retrofit existing facilities using an eligible technology to develop advanced biofuels. Under the proposed rule, USDA Rural Development proposes a rolling application process for the consideration of loan guarantee requests. The Agency will consider a technology that is being adopted in a viable commercial-scale operation that produces advanced biofuels.
Under the proposed rule, the maximum loan amount will be $250 million; there is no minimum amount. The amount of a loan guarantee for a project will not exceed 80 percent of the total eligible project costs.
Bioenergy Program for Advanced Biofuels. USDA Rural Development is proposing to establish a payment program for eligible producers of advanced biofuels. To be eligible for payments, advanced biofuels must be produced from renewable biomass, excluding corn kernel starch. USDA would enter into contracts with advanced biofuels producers to support and ensure an expanding production of advanced biofuels.
Repowering Assistance Payments. USDA is proposing to make payments to eligible biorefineries to install new systems that encourage renewable biomass energy use and replace fossil fuels. Under the proposed rule, USDA Rural Development will propose procedures for eligible biorefineries to receive a payment equal to 50 percent of the cost of installing eligible systems, up to $5 million, whichever is less. There is no minimum payment amount. The initial payment would be a percentage of the cost of installing eligible systems. The remaining payment would be based on the amount of energy produced from renewable biomass.
Additional information on the proposed rules and instructions on how the public can offer comments are available in the 16 April 2010 Federal Register.