USDA offers loan guarantees to boost advanced biofuels
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WASHINGTON, Oct. 21, 2013 - USDA says it will invest $181 million in loan guarantees to develop commercial-scale biorefineries or retrofit existing facilities with appropriate technology to develop advanced biofuels.
Agriculture Secretary Tom Vilsack says the funding will expand the number of commercial biorefineries in operation that produce advanced biofuels from non-food sources.
Vilsack said the benefits of advanced biofuel production go beyond reducing U.S. dependence on foreign oil. "These biorefineries are also creating lasting job opportunities in rural America and are boosting the rural economy as well," he said."
The Biorefinery Assistance Program was created through the 2008 Farm Bill and is administered by USDA Rural Development. It provides loan guarantees to viable commercial-scale facilities to develop new and emerging technologies for advanced biofuels. Eligible entities include Indian tribes, State or local governments, corporations, farmer co-ops, agricultural producer associations, higher education institutions, rural electric co-ops and public power entities.
In making the announcement, the department cited a number of "success stories" from previous funding, including Sapphire Energy's "Green Crude Farm" in Columbus, N.M., where, in 2011, USDA provided a $54.5 million loan guarantee to build a refined alga oil commercial facility. In continuous operation since May 2012, the plant is producing renewable algal oil that can be further refined to replace petroleum-derived diesel and jet fuel.
According to the company, more than 600 jobs were created throughout the first phase of construction at the facility, and 30 full-time employees currently operate the plant. The company expects to produce 100 barrels of refined algal oil per day by 2015, and to be at commercial-scale production by 2018.
After receiving additional equity from private investors, Sapphire was able to repay the remaining balance on its USDA-backed loan earlier this year, USDA said.
Also in 2011, USDA issued a $12.8 million loan guarantee to Fremont Community Digester for construction of an anaerobic digester in Fremont, Mich. The digester, which began commercial operations late last year, is the largest commercial-scale anaerobic digester in the United States and has the capacity to process more than 100,000 tons of food waste annually to produce biogas and electricity.
The operators of the facility say the biogas produced runs generators that total 2.85 megawatts in capacity. The electricity produced is sold to a local utility and is providing power for about 1,500 local homes.
USDA officials say applications for biorefinery assistance are due by Jan. 30, 2014
Information about how to apply is available HERE.
USDA says since 2009, it has more than $684 million in assistance to support biofuels projects in eight states. Vilsack said today's funding announcement underscores the importance of USDA farm energy programs and other farm bill provisions to rural areas. He called on Congress to quickly pass a new farm bill - the 2008 Farm Bill expired Sept. 30 ‑ that will "expand the rural economy."
Andy Olsen, a senior policy analyst with the Environmental Law and Policy Institute and an advocate of farm energy programs, says the Biorefinery Assistance Program "has helped accelerate introduction to the marketplace of new technologies for clean energy."
He said Congress needs to authorize and fund programs that have proven effective since they were first implemented in the 2003 and 2008 Farm Bills. "We need to continue this progress for the benefit of agriculture, rural communities and the entire country," he said.
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