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MARKET WATCH

USDA Backs Biobased Products Sector with $250 Million Loan Guarantees

Posted by John Greene on August 5, 2015

We recently covered the USDA report detailing the economic impact in both jobs and revenue that the larger biobased products industry supports, and the numbers are significant: using 2013 data, this sector was responsible for sustaining 4 million total jobs and creating a $369 billion value-added contribution to the US economy. With this news, USDA announced changes to the 2014 Farm Bill that will create new growth opportunities for organizations involved in renewable resources by expanding the BioPreferred program.

The report states that, “The mission of the BioPreferred program is to facilitate the development and expansion of markets for biobased products. To accomplish this mission, the program has two broad strategic goals: 1) to advance the biobased products market and 2) to increase the purchase of biobased products government-wide.”

bio_fuel_plant

To show additional support for this important sector, Agriculture Secretary Tom Vilsack recently announced that USDA will be accepting applications for new funding under a program that is designed to foster the production of advanced biofuels, renewable chemicals, and biobased product manufacturing. USDA is offering the funding through the Biorefinery, Renewable Chemical, and Biobased Product Manufacturing Assistance Program (formerly known as the Biorefinery Assistance Program).

The new program will provide loan guarantees of up to $250 million to construct and retrofit commercial-scale biorefineries, as well as develop renewable chemicals and biobased product manufacturing facilities. USDA has made significant improvements to the loan program, including a change that allows biorefineries to receive funding to produce more renewable chemicals and other biobased products in addition to advanced biofuels. Also, biobased product manufacturing facilities will be eligible to convert renewable chemicals and other biobased outputs into "end-user" products.

Two funding cycles are being held; applications for the first round are due by October 1, 2015 and applications for the second round are due by April 1, 2016.

Secretary Vilsack noted, "This critical financing will enhance our efforts to build a robust, rural bioeconomy by helping to expand the availability of biobased products and to increase the number of commercial-scale biorefineries in the country. In addition to the available funding, I am proud to announce that USDA has significantly improved the biorefinery program to help create lasting job opportunities in rural America."

The continued development of programs that offer real-world support to the biorefinery and biobased products sectors is important for the environmental and economic health of our nation. As our energy needs continue to evolve, the country has a vested interest in expanding its energy portfolio to incorporate not only energy derived from clean, renewable resources, but also in the expansion and availability of biobased products. That these products are oftentimes derived from, and manufactured within, rural American settings speaks to the importance of biobased jobs and their sustainable impact on these communities.

The future of these sectors depends on both private and public support, and Secretary Vilsack’s leadership and dedication to the biorefinery and Biobased products programs will benefit the industry and the millions of employees involved in producing some of America’s most innovative products.

Biofuels project support services

Topics: Biobased Products

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