What is in this article?:
- U.S. government provides nearly $650 million in loan guarantees for biofuel refinery construction.
- Projects in the Southeast to receive $405 million in loan guarantees.
- USDA pushing non-corn biofuel production through the Bioenergy Program for Advanced Biofuels
As biofuel production ramps up, one persistent question has been how to get it to consumers along with the logistics and expense of fitting gas stations to handle the fuel. During the press conference, Vilsack was asked about funding blender-pump infrastructure in 2011/2012.
“The USDA has been working with the (U.S. Department of Energy) to encourage states with resources under the Recovery Act to assist at the state level blender-pump and distribution system assistance,” said Vilsack. “We know a handful of states have accepted that challenge in using some of the resources still available to them under the Energy Grant.
“In addition … we think the blender-pumps are important to making sure we not only increase demand for this product but make the supply convenient.
“We know Congress will be discussing, over the next 12 months, the tax incentives currently in place … that have been providing help to this maturing industry. There may be a debate about whether, or not, incentives currently being provided can be directed in a different, more beneficial direction, given where the industry is and where it needs to go.”
Does Vilsack expect Congress will fund the Biomass Crop Assistance Program (BCAP)?
“The tremendous reaction to the BCAP program by producers across the country – and the fact we were able to make, literally, hundreds of awards … in a variety of feedstock opportunities … suggests this is a program that is important, popular and may be necessary in the short-run to get this industry in a place where we work out the inefficiencies and devise supply chains that make sense.
“I think if Congress learns of the success (of BCAP), they’ll understand the necessity for adequate financing. We obviously live in an environment of constrained resources.
“There are no sacred cows and there shouldn’t be. But I believe this program will still have congressional support and we’ll use it as an important tool in connection with biorefinery systems, in connection with tax policy, in connection with EPA’s recent efforts in allowing E-15 for vehicles from 2007 and later. All of this combined creates momentum, interest and enthusiasm for this and we’re seeing it reflected in increased market share of renewable energy and fuel sources in terms of total energy production in the country.”
Critics of the government’s biofuels approach continue to fret over what it means for corn prices. Ethanol is at least partially responsible for feed prices that impact livestock and dairy operations.
“I want to say I have tremendous confidence in the capacity of American agriculture to meet any challenge,” said Vilsack. “It’s met those challenges over the past several decades when we’ve seen a remarkable increase in productivity…
“Corn prices are very strong today and there are a multitude of reasons for that. Obviously, we’re keeping an eye on that as it relates to the ability of our livestock and dairy producers to be profitable. We want a balance in agriculture.”
Vilsack was keen to point out that in the latest projects corn isn’t the biofuel feedstock.
“To be clear, these announcements are about feedstocks other than corn. … This industry can’t be just Midwest-based or (based) even on one commodity. It really has the potential and opportunity to be in every part of the country using whatever resource is most plentiful in that part of the country. Over time, that should take some of the pressure off of corn.
“And we may learn how to use other parts of the corn crop that don’t jeopardize our capacity in the future to meet feed, fiber or food needs.”