By Tina Caparella
Up to $15 million in grants to support President George W. Bush’s energy plan to develop renewable energy and expand the economic prospects and environmental benefits of biomass are available from the U.S. Department of Agriculture (USDA) and U.S. Department of Energy (DOE). Through the Biomass Research and Development Initiative, these grants are available to eligible entities to carry out research, development, and demonstrations on biobased products, bioenergy, biofuels, biopower, and related processes.
Eligible applicants include private sector entities, institutes of higher education, nonprofit organizations, national laboratories, federal and state research agencies, and consortiums consisting of two or more of these entities. Grants will be awarded competitively based on technical merit and program priorities identified in the solicitation package.
The USDA Natural Resources Conservation Services, on behalf of USDA and DOE, is requesting proposals for the grants. Pre-applications for the joint solicitation must be submitted by February 15, 2005. The solicitation package (USDA-GRANTS-67-3A75-5-22) is posted on the federal funding opportunities Web site at www.fedgrants.gov, and in more detail at www.bioproducts-bioenergy.gov.
For this solicitation, a minimum nonfederal share of 20 percent of the total project cost is required. The federal share of each grant is expected to range from $250,000 to $2 million, with the work proposed to be completed within a three-year timeframe. Approximately 400 applications were submitted for this solicitation in both fiscal years 2003 and 2004.
EPA Awards Research Grants
Four student projects that focus on biodiesel received grants of up to $10,000 in EPA’s People, Prosperity, and the Planet (P3) National Student Design Competition. A total of 66 student teams from 51 universities received grants in the contest.
The P3 design competition was launched in January 2004 to stimulate the research and development of sustainable solutions to environmental challenges. The projects receiving research grants concern topics such as green buildings and sustainable construction materials, biodiesel production and use, drinking water quality and supply, alternative energy sources and fuel cells, urban redevelopment, and green chemistry.
Oregon State University received a $10,000 grant for their project, “From Field to Fuel Tank: Exploring the Implementation of Biodiesel as a Sustainable Alternative to Petroleum Diesel in Oregon’s Willamette Valley.”
Middlebury College in Vermont received a $7,560 grant for their project, “Demonstrating the Feasibility of a Biofuel: Production and Use of Biodiesel from Waste Oil Feedstock and Bio-based Methanol at Middlebury College.”
Oberlin College in Ohio received a $10,000 grant for their project, “Community-Scale Biodiesel: An Affordable, Renewable Resource.”
Pennsylvania State University received a $10,000 grant for their project, “Reduction of Use of Petroleum Energy Resources by Conversion of Waste Cooking Oils into Diesel Fuel (Phase 1).” The project consists of three phases: Phase 1 – process development and construction of a pilot plant; Phase 2 – engine performance and emission reduction studies; and Phase 3 – commercialization of a self-sustaining facility for nearly 200 pieces of campus equipment currently fueled with petroleum diesel fuel.
All teams receiving the grants will be invited to bring their designs to Washington, DC, on May 16 and 17, 2005, to compete for the P3 Award. The National Academy of Engineering will convene a panel of judges for the competition with winners eligible for additional funds from EPA to match contributions from industry or non-governmental organizations to help further develop the design, implement the project in the field, and move the design to the marketplace.
Australia Hands Out Funds
Australia’s federal government has awarded grants to a biodiesel plant and an ethanol plant totaling $13 million (Australian). The funds will come from the second round of the government’s Biofuels Capital Grants Program.
Riverina Biofuels, a biodiesel plant in Deniliquin, New South Wales, was awarded $7.15 million. According to news reports, the company’s new biodiesel plant should be completed in mid-2006 and will use tallow as its feedstock. Lemon Tree Pty., Ltd., an ethanol plant in Millmerran, Queensland, was awarded $5.85 million.
It was reported that Renewable Fuels Australia Executive Director Bob Gordon said the emerging renewable fuels industry was grateful for the funding, but was disappointed the potential benefits for Australia had not been fully recognized.
“As many potential industry entrants feared, the failure by the government to meet its 2001 election and subsequent budget promise of $50 million for the scheme, stripping $13 million from the scheme, has meant only a small number of the 11 to 12 projects that met the grant scheme criteria have been selected for funding,” Gordon is quoted from a statement.
The Australian government has targeted 350 million liters (92.4 million gallons) of biofuels production by 2010.
Canadian Renderer is On Board
West Coast Reduction, Ltd., has announced they are in the biodiesel distribution business.
“We are excited to provide the British Columbia marketplace with biodiesel at a very competitive price while we consider plans to build a buildiesel plant in Western Canada,” said Ridley Bestwick, West Coast Reduction’s chief information officer. “We plan to initially distribute B100 [100 percent biodiesel] meeting ASTM D 6751 specifications to customers on Vancouver Island and in the greater Vancouver area.”
West Coast Reduction renders inedible animal by-products from the meat, poultry, and fish processing industries and recycles used restaurant grease. Along with operating rendering plants in western Canada, the company has an established 85,000 metric ton tank farm serviced by rail on the Vancouver Port and is well experienced in distributing fats and oils.
Indiana Increases Tax Credits
The Indiana Legislature passed a bill that increased the limit on tax credits for biodiesel and blended biodiesel producers from $1 million to $5 million, effective January 1, 2005. The bill provides that the tax credits are in addition to any federal tax credit a producer may receive and that taxpayers that sell blended biodiesel to end users in Indiana are entitled to tax credits not to exceed $5 million. The previous law limited total credits to $1 million for blended biodiesel dealers that sell and dispense blended biodiesel from metered pumps.
Pennsylvania Law to Boost Use
A bill signed into law by Pennsylvania Governor Edward G. Rendell in late November will significantly increase demand for biodiesel in the state, according to the National Biodiesel Board (NBB).
The Alternative Fuels Incentive Act establishes a $10 million Energy Development Fund to provide assistance for alternative energy research and the installation of stationary power facilities that use alternative fuels to generate electric power. The grant and rebate portions of the law will cover a portion of the cost difference between an alternative fuel vehicle and a conventional vehicle. This also applies to home refueling equipment and fuel itself.
The fund is comprised of a portion of revenues allocated from the utilities gross receipts tax and will be expended by the Department of Environmental Protection for grants to school districts, municipal authorities, political subdivisions, nonprofit entities, corporations, or partnerships for the incremental cost of biodiesel, among other alternative fuel provisions.
According to NBB, the fund may also be used for reimbursement of up to five cents per gallon for up to 12.5 million gallons a year of renewable fuels produced by a qualified renewable fuels producer. Other alternative fuels addressed are natural gas, liquid propane, ethanol and methanol, and electricity. Biodiesel is defined in the legislation as that which meets the American Society for Testing and Materials biodiesel standard. The bill took effect immediately.
Tax Incentive Guidelines Released
The Internal Revenue Service (IRS) has published a guidance document related to the federal tax incentive for biodiesel, according to the National Biodiesel Board (NBB). The provisions in IRS Notice 2005-04, which addresses the tax provisions added or affected by the American Jobs Creation Act of 2004, will be the subject of a notice of proposed rulemaking that the U.S. Department of Treasury and the IRS plan to issue this year. The notice also requests comments from the public on these provisions as well as other excise tax provisions that were added or affected by the act.
NBB says the published notice provides guidance that is general in nature, but does not contain specifics relative to the numerous questions that have been identified by industry. According to NBB, the IRS is in the process of developing detailed guidance documents for several critical aspects of the incentive including producer registration and certification of feedstocks, among others. Members of the industry Ad Hoc Incentive Implementation Committee and NBB staff have been working with IRS and Treasury personnel in the development of these detailed guidance documents, which are still several months from completion.
The current guidance document is available on NBB’s Web site at www.biodiesel.org.
New Book Released
A freelance journalist who has covered energy and the environment for over 20 years has released Biodiesel: Growing a New Energy Economy, a book that covers the history of biodiesel, explains the technology, and explores biodiesel potential in the United States.
In his new book, Greg Pahl takes a critical look at the fuel-producing potential of a variety of feedstocks. He also shows how biodiesel production could provide for more than 20 percent of the United States’ diesel fuel needs and examines the main players in the biodiesel industry, including Griffin Industries, a renderer who ventured into biodiesel in 1998 with the construction of a 1.6 million gallon capacity plant.
Biodiesel Bulletin - February 2005 Render