USDA Announces Millions in Payments to Support Production of Advanced Biofuels

In late May, Agriculture Secretary Tom Vilsack announced that the U.S. Department of Agriculture (USDA) would be investing $8.8 million to boost the production of advanced biofuels and sustain jobs at renewable energy facilities in 39 states. While we took note of the disappointing RFS volume proposals recently issued by the Environmental Protection Agency (EPA) for the exclusive development of liquid biofuels, for its part, USDA is actively making monetary commitments to encourage the production of all advanced biofuels.

The funding is being provided through USDA's Advanced Biofuel Payment Program, which was established in the 2008 Farm Bill. Payments are made to biofuels producers based on the amount of advanced biofuels they produce from renewable biomass (other than corn kernel starch), including forest raw materials typically in the form of wood pellets. Any manufacturer that produces and sells advanced biofuels is eligible to apply; qualifying advanced biofuels may be in liquid, gas or solid form. To date, USDA has made $308 million in payments to 382 producers in 47 states and territories via this biofuel program, and these payments have produced enough biofuel to provide more than 391 billion kilowatt hours of electric energy.

Secretary Vilsack has recognized the biobased economy as one of the pillars that strengthen rural communities. Through the Advanced Biofuel Payment Program, USDA is working to support the research, investment and infrastructure necessary to build a strong biofuels industry that creates jobs and broadens the range of feedstocks used to produce renewable fuels. "Advanced biofuels expand America's energy options and increase our sources of homegrown, renewable energy," said Secretary Vilsack. "These payments not only help to spur biofuel production, but also protect the environment and help create jobs by building a renewable energy economy in rural areas."

Investments in renewable energy and the biobased economy are a leading part of USDA's commitment to mitigating climate change and promoting a clean-energy economy. To that end, USDA has also supported efforts to build six new biorefineries to produce advanced biofuels in Louisiana, Georgia, Oregon, Nevada, North Carolina, and Iowa, in addition to three existing facilities in New Mexico, Michigan and Florida.

Individual biofuels manufacturers utilizing forest raw materials exclusively (in the form of wood pellets) that will be receiving funding through the Advanced Biofuel Payment Program include:

• Lee Energy Solutions
• Westervelt Pellets I, LLC
• Fiber Energy Products, LLC
• Confluence Energy, LLC
• Appling County Pellets, LLC
• Ronald Davis Logging Co.
• Varn Wood Pellets
• Lignetics of Idaho, Inc.
• Somerset Hardwood Flooring
• Enviva LP
• Corinth Pellets, LLC
• GF Funding, LLC
• Maine Woods Pellet Co., LLC
• Fiber By-Products Corp.
• New England Wood Pellet, LLC
• Biomaxx, Inc.
• Curran Renewable Energy, LLC
• American Wood Fibers, Inc.
• Bear Mountain Forest Products, Inc.
• Blue Mountain Lumber Products, LLC
• West Oregon Wood Products, Inc.
• Energex American, Inc.
• Turman Hardwood Flooring, Inc.
• Indeck Ladysmith Biofuel Center
• Appalachian Wood Pellets, Inc.
• Hamer Pellet Fuel

As noted above, USDA payment totals are based on the amount of advanced biofuels each manufacturer produces from renewable biomass. Standout biofuels manufacturers utilizing forest raw materials include:

• Enviva LP: $33,653
• Appling County Pellets, LLC: $26,555
• New England Wood Pellet, LLC: $5,671
• Lignetics of Idaho, Inc.: $5,135

These payments build on USDA's investments in rural American agriculture and job creation. American agriculture supports one in 11 US jobs, provides consumers with more than 80 percent of our food and supports markets for homegrown renewable energy and materials. USDA also continually develops new markets for rural-made products, including more than 2,500 biobased products since 2009 through its BioPreferred program.

While interest in many types of advanced biofuels has waned recently due to the relative, “cheap” price of fossil fuels, USDA is maintaining its commitment to expanding the biobased economy by funding the Advanced Biofuel Payment Program. Meanwhile, EPA continues to drag its feet in developing real opportunities for advanced liquid biofuels to compete and succeed in the marketplace.

To view the complete list of advanced biofuels producers receiving payments via this USDA program, click here.