These funds were made available through the Higher Blends Infrastructure Incentive Program (HBIIP) to recipients in 14 states. The initial $22 million in HBIIP investments are projected to increase ethanol demand by nearly 150 million gpy.
HBIIP helps transportation fueling and biodiesel distribution facilities convert to higher ethanol and biodiesel blends by sharing the costs related to the installation of fuel pumps, related equipment and infrastructure. Eligible applicants are vehicle fueling facilities, including, but not limited to, local fueling stations/locations, convenience stores, hypermarket fueling stations, fleet facilities, fuel terminal operations, midstream partners and/or distribution facilities. Higher biofuel blends are fuels containing ethanol greater than 10 pct by volume and/or fuels containing biodiesel blends greater than 5 pct by volume.
According to the USDA release, funds will be made directly available to assist transportation and fueling and biodiesel distribution facilities with converting to higher ethanol and biodiesel blends by sharing the costs related to and/or offering sales incentives for the installation of fuel pumps, related equipment and infrastructure. distribution facilities.
Of the total $100 million, $86 million will be available for implementation activities related to ethanol blends above E10 and $14 million will be available for implementation activities related to blends of biodiesel above B5. Grants for up to 50 percent of total eligible projects costs, up to $5 million, are available to vehicle fueling facilities, including local fueling stations/locations, convenience stores, hypermarket fueling stations, fleet facilities, fuel terminal operations, midstream partners and/or distribution facilities.
The agency expects the $100 million in funding to support approximately 150 awards and provide assistance to approximately 1,500 locations.
As an aside, Renewable Fuels Association President and CEO Geoff Cooper offered the following statement in response: "U.S. ethanol producers today are facing the worst economic conditions in the industry's 40-year history due to COVID-19, and they need immediate emergency relief to survive this catastrophe. Once the pandemic is over and fuel markets are showing signs of recovery, expanding infrastructure via the Higher Blends Infrastructure Incentive Program will be important to the long-term future of the ethanol industry and rural America. We thank the USDA for its efforts to support the future of renewable fuels."
(Source: USDA, May, 2020)Contact: USDA, Sonny Perdue, Sec., www.usda.gov; Renewable Fuels Association, Geoff Cooper, (202) 289-3835, www.ethanolrfa.org
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Biofuels producers were not included in the aid package, although the sector consumes approximately 40 pct of America's total annual corn crop.
In the 2018/2019 crop marketing year, (Sept. 1- Aug. 31) the U.S. grew more than 14.42 billion bushels (366 million metric tons) of corn.
(Source: USDA, nexstar, 21 April, 2020)Contact: USDA, Sonny Perdue, Sec., www.usda.gov
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Dear Secretary Perdue,
"The Coronavirus Aid, Relief and Economic Security (CARES) Act provided USDA with additional resources to support farm income and prices during this economic downturn. The CARES Act included a reimbursement of $14 billion to the Commodity Credit Corporation (CCC), and $9.5 billion for the Secretary to respond to the economic impacts of COVID-19. As the U.S. Department of Agriculture (USDA) prepares to address financial hardship in agriculture, we urge you to use funds from the CARES Act to provide direct relief to the biofuels industry.
"Demand for fuel is declining as states implement stay-at-home orders and discourage travel. This sudden shift in demand is worsening market conditions to the point ethanol plants are halting production. The biofuels industry is a vital market for the commodities our farmers produce, and USDA must take immediate action to ensure plants can retain skilled workers and continue production when market conditions improve.
"The biofuels sector provides a direct and significant boost to the value of corn and soybeans. Ethanol plants purchase two out of every five bushels of U.S. corn and biodiesel producers use over 8 billion pounds of soybean oil a year. Ethanol plants produce dried distillers grains (DDGs) as a byproduct, providing livestock farmers with a low-cost, high-protein component of animal feed. To assist with the response to COVID-19, some ethanol and biofuels plants have volunteered to produce hand sanitizer and disinfectant products to address nationwide shortages. And, ethanol plants produce high purity carbon dioxide that is critical for medical facilities and food processing. The biofuels sector plays a large role in the livelihood of America's commodity and livestock producers, and biofuels plants are major employers in many rural communities.
"USDA should take immediate action to stabilize the biofuels industry with resources provided by the CARES Act. We look forward to working with you on this issue as USDA assists producers through this challenging time. Thank you for considering this request."
(Source: Congressman Steven King, KIOW Radio, 12 April, 2020) Contact: Rep Steve King, steveking.house.gov
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"As the country follows the advice of local and state governments and remain at home, motor fuel use has rapidly decreased. The decrease in fuel consumption has left (biofuel) production facilities little choice but to idle production or close completely.
"Farm income and prices for corn and other crop commodities are directly linked to the health of the renewable fuel industry. Ethanol plants use 40 percent of all corn grown in the United States. Among other feedstocks, biodiesel and renewable diesel producers currently use over 8 billion pounds of soybean oil a year, creating demand that adds 13 percent to the cash price of a bushel of soybeans.
"We have seen a significant drop in the price of corn and soybeans because of the decline in demand. Keeping plants open is vital for our states and we ask that you use the authority given by Congress to assist the biofuel industry during extremely difficult times. We are supportive of the proposals the biofuel industry has put forward to reimburse feedstocks and also believe that adding additional CCC funds to the Higher-Blends Infrastructure Incentive Program will drive future biofuel demand,” the senators continued," the letter said.
(Source: Various Media, Atlantic News Telegraph, 8 April, 2020)Contact: Sen. Chuck Grassley (R-Iowa), www.grassley.senate.gov; Sen. Joni Ernst, www.ernst.senate.gov
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These actions have the potential to increase USDA's annual consumption of E15 by up to 9 million gallons, E85 by 10 million gallons, and biodiesel and renewable diesel blends by up to 3 million gallons.
The agency also announced it will offer $100 million in grant funding this year for the newly created Higher Blends Infrastructure Incentive Program (HBIIP) to help transportation fueling and biodiesel distribution facilities install, retrofit, and/or upgrade fuel storage, dispenser pumps, related equipment and infrastructure to be able to sell ethanol and biodiesel.
Download HBIIP program details HERE.
Download the USDA order HERE. (Source: USDA, 28 Feb., 2020) Contact: USDA, Sonny Perdue, Sec.,www.usda.gov
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Perdue either couldn't or wouldn't say what action the president will or might take, but noted that Trump believes the EPA waivers were "way overdone." Ethanol advocates contend that oil refinery waivers have reduced ethanol production by 2.6 billion gallons since Trump moved into the White House.
When grilled on the Trump administration's biofuels, trade and Renewable Fuel Standard and related policies Perdue replied "EPA will continue to consult with our federal partners on the best path forward to ensure stability in the Renewable Fuel Standard. The president will always seek to engage with stakeholders to achieve wins for the agriculture and energy sectors." So sayeth Sonny!(Source: St. Louis Post-Dispatch, CBS, Various Media, 28 Aug., 2019) Contact: Office of US Sec of Agriculture, Sonny Perdue, (202) 720-2791, email@example.com, www.usda.gov, twitter.com/SecretarySonny
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"We strongly oppose giving the Secretary (Perdue) any role in the decision-making process over the petitions. We would view any decisions to further delay, reduce, or deny hardship relief to small refineries, or reallocate the obligations of small refineries to other refineries, as the result of the Secretary of Agriculture's impermissible interference. We are confident that others, including the federal courts, would do the same," the thirteen Senators wrote.
The small-refinery exemptions have reduced ethanol use by about 2.6 billion gallons, and 38 refiners are waiting for EPA to decide on new exemptions.
Senators writing the letter included Sen. John Barrasso (R-Wyo.) as well as senators representing Louisiana, Montana, Oklahoma, Pennsylvania, Texas, Utah and West Virginia.
As previously noted, "hardship waivers" were intended for refineries producing 75,000 bpd or less and suffered "disproportionate economic hardship" from the costs of RFS compliance. The waiver frees the refineries from an obligation to provide the EPA with biofuels credits proving compliance. In 2017, the number of small refineries filing for exemptions retroactively for 2016 jumped from 14 the previous year to 20. The rate in which EPA granted these petitions also increased dramatically from 53 pct to 95 pct (Source: Various Media, DTN, Progressive Farmer, July, 2019)
Contact: Office of Secretary of Agriculture Sonny Perdue,(202) 720-2791,
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U.S. Agriculture Secretary Sonny Perdue was commenting on the progress of his "positive" talks with China about reducing Beijing's 70 pct "retaliatory" tariff on U.S. ethanol products.
In his comments, Perdue also noted that he wanted the EPA to more tightly control its use of small refinery "hardship" waivers that exempt plants from their obligation to blend biofuels like corn-based ethanol under the Renewable Fuel Standard. Perdue added that he'd discussed the matter with EPA chief Andrew Wheeler. (Source: Voice of America, NASDAQ, 9 April,
Contact: U.S. Agriculture Secretary Sonny Perdue, (202) 720-2791 -- general information, https://twitter.com/SecretarySonny, www.whitehouse.gov/people/sonny-perdue
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"These new findings provide further evidence that biofuels from America's heartland reduce greenhouse gases even more than we thought, and that our farmers and ethanol plants continue to become more efficient and effective," said Secretary Sonny Perdue. "Expanding the sale of E15 year-round will provide consumers with more choices when they fill up at the pump, including environmentally friendly fuel with decreased emissions. I appreciate EPA Administrator Andrew Wheeler moving expeditiously to finalize the E-15 rule before the start of summer driving season," Perdue added.
The study, led by Dr. Jan Lewandrowski of USDA's Office of the Chief Economist, and published in the journal Biofuels, supports findings of other research that ethanol has a significantly better GHG profile than previously estimated.
The study attributes much of these additional benefits to revised estimates of the impacts of land-use change as a result of demand for ethanol. Where previous estimates anticipated farmers bringing additional land into production as a result of increased corn prices, recent analysis finds only modest increases in crop acreage. Additional improvements at ethanol refineries, combined with on-farm conservation practices that reduce GHG emissions, such as reduced tillage and cover crops, have further decreased emissions associated with corn ethanol. The study projects that with added improvements in refineries and on farms, a reduction of over 70 pct in lifecycle emissions is possible by 2022.
The study is available for download HERE. Additional information on the greenhouse gas profile of biofuels is available at www.usda.gov/oce/oeep. (Source: USDA, 2 April, 2019) Contact: USDA, www.usda.gov
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Profitability is a huge concern for Iowa's corn farmers now facing the fifth consecutive year of declining farm incomes while facing high levels of uncertainty due to ongoing trade disputes and disruptions in the ethanol markets.
The Iowa Corn Farmers Association's message to the Trump administration was clear -- "Corn farmers prefer to have market access to compete in a global marketplace, not rely on government assistance, for their livelihoods. Remove unnecessary trade barriers and restore our access to international markets." (Source: Iowa Corn Growers Association, PR, 27 Aug., 2018)Contact: Iowa Corn Growers Association, (515) 225-9242, www.iowacorn.org
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"The nation's corn growers thank Senator Chuck Grassley, Senator Joni Ernst and USDA Secretary Sonny Perdue for their advocacy and steadfast support for farmers, rural communities and renewable fuels. We greatly appreciate their efforts.
"With the expectation that the Administration was preparing to take drastic actions to unravel the RFS, farmers are very pleased those actions have been set aside and strongly encourage the Administration to keep the President's commitment to America's farmers and (leave) the RFS intact." (Source: NCGA, Wisc. AgConnection, 7 June, 2018) Contact: National Corn Growers Association, Kevin Skunes, Pres., (202) 326-0644, www.ncga.com
More Low-Carbon Energy News RFS, Biofuels, NCGA,