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Amid questions on funding, new bioenergy projects announced

USDA announces four new Biomass Crop Assistance Program projects. Agriculture Secretary Vilsack queried on funding issues.  

The Obama administration continues to push bioenergy projects as a way to revitalize rural America and reduce U.S. dependency on foreign sources of energy.

On Tuesday morning, the USDA unveiled four new Biomass Crop Assistance Program (BCAP) project areas in six states. This, according to Agriculture Secretary Tom Vilsack is to “expand the availability of non-food crops to be used in the manufacturing of liquid biofuels. The four project areas set aside acres in California, Kansas, Montana, Oklahoma, Oregon and Washington for the production of renewable energy crops. According to industry estimates, these projects will create more than 3,400 jobs in the biorefinery, agriculture and supporting sectors. Once fully functional (they will) produce more than 2 million gallons of biofuels annually when full production levels are achieved.”

The BCAP program, Vilsack continued “has allowed financial incentives to interested farmers, ranchers and forested landowners for establishing and producing non-food energy crops for conversion to heat, power, and biobased products as well as advanced biofuels. … The Renewable Fuel Standard calls for 36 billion gallons biofuels by 2022. Because corn starch ethanol is limited to 15 billion, that means more than 2 billion gallons of renewable fuels must be produced in just 10 years from feedstocks other than corn starch.

“That’s why BCAP is important and today’s announcement is important. This is the only federal program that ensures sufficient biomass will be available to reduce America’s reliance on foreign oil.”

For more, see BCAP.

Following Tuesday’s announcement, Vilsack was peppered with questions regarding the future funding of the programs. He admitted that “at this time, Congress has essentially reduced their commitment to BCAP. At this point, there is no assurance that in 2012 we’ll have additional resources.”

Any dip in funding would be short-sighted, said Vilsack because the program sites “are beginning to create jobs, encourage farmers to take a look at non-productive land creating another income source, and it’s certainly consistent with everyone’s desire to reduce our reliance on foreign oil. … I’d hope, (despite) the fact of constrained resources, that we don’t lose sight of the opportunity to invest and grow the economy.”

Even without the support of Congress, Vilsack repeatedly said the current projects are funded. “The funding is (available), which is why we’re making the announcements. We’ll continue to make announcements based on the resources available.

“The funding is there to basically, fully pay the responsibilities and contracts entered into under these projects…

“When we enter into a (long-term) contract -- both in terms of resources to put the crop in the ground and then maintenance – we essentially have the resources to pay the full amount of the contract. We aren’t making a commitment dependent on subsequent appropriations.”

As for the current desire by Congress to swing a hatchet at government spending, “we understand the importance and necessity of reducing budgets. Right now, we’re dealing with a fiscal budget based on a continuing resolution that reduced our discretionary spending by, roughly, 10 percent…

“We understand the House has called for additional, deeper cuts. Our hope is we’ll be given enough time to manage this properly.”

New projects

Earlier this year, USDA announced five BCAP project areas where energy crops will be grown on up to 250,000 acres in 66 counties in Arkansas, Kansas, Missouri, Pennsylvania and Ohio.

Of the new programs, two of the project areas, targeted for California, Montana, Washington and Oregon, “will grow camelina at a significant scale. Camelina, an oilseed, is a rotation crop for wheat that can be established on marginally productive land. Biofuel from camelina is an ideal jet fuel substitute.”

Another BCAP project area “will encourage growth of hybrid poplar trees in Oregon. The goal is to enroll up to 7,000 acres. This project is part of a series of measures that comprise USDA's Wood-to-Energy Initiative. It seeks to build a forest restoration economy by integrating energy feedstock within the larger forest products sector to sustain rural jobs and prosperity.”

In Kansas and Oklahoma, a BCAP project sponsored by Abengoa Biofuels “has been designated to grow up to 20,000 acres of switchgrass. The project area surrounds the future facility's biomass conversion facility in Hugoton, Kan.”

According to the USDA, it has allocated approximately $45 million for contracts that range between less than five years up to 15 years in the four project areas for producers who volunteer to enroll in BCAP. Producers who enter into BCAP contracts are eligible for reimbursements of up to 75 percent of the establishment costs of the perennial energy crop, and up to five years of annual maintenance payments for herbaceous crops and up to 15 years for woody crops.

The sign-up period for these four new project areas will begin on Aug. 8. The deadline to sign up for the project areas is Sept. 16. Producers interested in participating in the project areas should visit their local FSA county office. Information about BCAP may be found at

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