You’ve Got a Friend in Me: USDA makes $100M available for Biofuel Infrastructure Grants

August 24, 2022 |

News is swirling around the bioeconomy this week on all fronts, but front and center I think we need to highlight that the Big V, U.S. Agriculture Secretary Tom Vilsack, highlighted that the Department is accepting applications for $100 million in grants to increase the sale and use of biofuels derived from U.S. agricultural products.

Yes, fuels need infrastructure, lots of it, very little historically was put in place, and the fossil industries, to put it kindly, haven’t been forthcoming on making sure that the infrastructure already in place works for renewables. What a shocker. 

USDA is making the funding available through the Higher Blends Infrastructure Incentive Program, which we’re going to refer to as HBIIP, and I suppose we can try and pronounce it Huh-Beep. Under any pronunciation, the program seeks to market higher blends of ethanol and biodiesel by sharing the costs to build and retrofit biofuel-related infrastructure such as pumps, dispensers and storage tanks. Which is to say, help for you, producer of ethanol and biodiesel or supporter of same. B99 instead of a stingy B5? E30 instead of a measly E10? Friend, you’ve found a home.

Get Money Now! The Here’s How

The $100 million available now will support a variety of fueling operations, including filling stations, convenience stores and larger retail stores that also sell fuel. The funds will also support fleet facilities including rail and marine, and fuel distribution facilities, such as fuel terminal operations, midstream operations, distribution facilities as well as home heating oil distribution centers.

The grants will cover up to 50% of total eligible project costs – but not more than $5 million – to help owners of transportation fueling and fuel distribution facilities convert to higher blends of ethanol and biodiesel. These higher-blend fuels must be greater than 10% for ethanol and greater than 5% for biodiesel.

Applications must be submitted by 4:30 p.m. ET Nov. 21, 2022. Visit the HBIIP webpage to learn more, sign up for webinars and apply. Additional information also is available on Grants.gov or page 51641 of the Aug. 23, 2022, Federal Register.

These investments reflect the goals of President Biden’s Inflation Reduction Act, which addresses immediate economic needs and includes the largest ever federal investment in clean energy for the future. The law includes another $500 million aimed at increasing the sale and use of agricultural commodity-based fuels. This funding will allow USDA to provide additional grants for infrastructure improvements related to blending, storing, supplying and distributing biofuels.

Yes, there are Brownie Points!

Well, they call them Priority Points. You can earn them! These are points assigned by USDA to projects that advance key priorities under the Biden-Harris Administration to help communities recover from the COVID-19 pandemic, advance equity and combat climate change. These extra points will increase the likelihood of funding for projects that will advance these key priorities for people living in rural America. So, absolutely emphasize climate change, but remember equity and pandemic recovery too.

The Bottom Line

As we’ve said elsewhere, people do not give you Infrastructure for Christmas. The sole current exception to the rule is the United States Department of Agriculture, and that is because like Woody from Toy Story, all day long they sing “You’ve Got a Friend in Me” and mean it. 

No kidding around. The USDA is the largest source of non-dilutive equity in the world where everyone in the building thinks that what you do is important and thinks quite a bit every week in how to provide it. As in fuels, food, feed, materials, adhesives, fibers, resins. plastics, coatings, that is to stay, the stuff you make, and the stuff we all use in everyday life. 

Which is why we call the USDA the Department of Stuff, and why Toy Story is their movie. They are just there for you — Woody, Buzz, Jessie, Little Bo-Peep, Hamm, Rex. Not Sid and Zurg, I suspect they work for climate deniers.

The Backstory

In June, USDA also announced that it had provided $700 million in relief funding to more than 100 biofuel producers in 25 states who experienced market losses due to the pandemic.

Under HBIIP, USDA provides grants to transportation fueling and distribution facilities. These grants lower the out-of-pocket costs for businesses to install and upgrade infrastructure and related equipment.

This additional funding follows an April investment of $5.6 million through HBIIP that is expected to increase the availability of biofuels by 59.5 million gallons per year in California, Delaware, Illinois, Maryland, New Jersey, New York and South Dakota.

Reaction from the stakeholders

“The Biden-Harris Administration recognizes that rural America is the key to reducing our reliance on fossil fuels and giving Americans cleaner, more affordable options at the pump,” Vilsack said. “Biofuels are homegrown fuels. Expanding the availability of higher-blend fuels is a win for American farmers, the rural economy and hardworking Americans who pay the price here at home when we depend on volatile fuel sources overseas.”

“The Biden-Harris Administration recognizes that rural America is the key to reducing our reliance on fossil fuels and giving Americans cleaner, more affordable options at the pump,” Vilsack added. “Biofuels are homegrown fuels. Expanding the availability of higher-blend fuels is a win for American farmers, the rural economy and hardworking Americans who pay the price here at home when we depend on volatile fuel sources overseas.”

 

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