The Biomass Crop Assistance Program has been elevated from pilot status and will resume making payments to eligible producers, federal officials said today. Initially authorized in the 2008 Food Conservation and Energy Act, the program is "designed to ensure that a sufficiently large base of new, non-food, non-feed biomass crops is established in anticipation of future demand for renewable energy consumption."
"By producing more biofuels in America, we will create jobs, combat global warming, replace our dependence on foreign oil and build a stronger foundation for the 21st century economy," said Agriculture Secretary Tom Vilsack before the National Press Club today in Washington, D.C.
The National 25x25 Steering Committee, which seeks to get 25 percent of U.S. energy from renewable resources like wind, solar and biofuels by 2025, commended Visack's announcement, according to biofuelsjournal.com.
The effort is designed to promote production of fuel from renewable sources. Vilsack called domestic production of renewable energy, including biofuels, a national imperative. "The Obama Administration is aggressively supporting our nation's farmers, ranchers and producers of biofuels as they work to bring greater energy independence to America," Vilsack said.
The program seeks to assist farmers establish perennial biomass crops by offering to cover up to three quarters of production costs and provide payments for up to "five years for annual or non-woody perennial crops and up to 15 years for woody perennial crops."
In addition, the program also provides matching payments to transport materials sold to biomass conversion facilities. The facilities convert the materials into heat, power, biobased products or advanced biofuels.
Vilsack cited a study released this month by the U.S. Department of Agriculture's Economic Research Service that said biofuels would benefit the U.S. economy if biofuel production technology continues to advance and petroleum prices continue to rise as projected.
"By substituting domestic biofuels for imported petroleum, the United States would pay less for imports overall and receive higher prices for exports, providing a gain for the economy from favorable terms of trade. Improved technology and increased investment would enhance the ability of the U.S. economy to expand," the report said.
The program is good news for the likes of Sacramento, Calif.-based Pacific Ethanol Inc., which announced this week that it would reopen its Stockton ethanol plant in the next couple of months. California's new budget provided an incentive program that also may allow Pacific Ethanol's Madera County plant to reopen if market conditions allow, said Neil Koehler, president and CEO.
The USDA move also should provide a boost to cellulosic ethanol, algae and other processes under research and development.