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USA: Biomass Crop Assistance Program

External Reference/Copyright
Issue date: 
January 4th, 2011
Publisher Name: 
International Forest Industries
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On December 15 2010, the United States Department of Agriculture (USDA) released all the documents necessary to kick off the implementation of the Biomass Crop Assistance Program. Biomass conversion facilities can now apply for qualifying status. As of December 30, only one facility had been qualified-a facility in Iowa run by Poet that converts corn cobs into cellulosic ethanol. This number is likely to increase quickly in the new year reports Forest2Market’s.Suppliers for many wood products and pulp and paper cogeneration facilities will no longer qualify for matching payments. Under the new rules, all wood fuel not separated from higher value products at the harvest site are now ineligible, as are materials for which there is already a market-most mill residues, for instance. 

Landowners, loggers and dealers who own or harvest wood fuel from timberland with a forest management and harvesting plan will continue to be eligible for matching payments, however, if they deliver qualified material to a qualified facility.

As implementation of the program hits full stride in 2011, there are a couple of issues that could present obstacles. First, is the methodology the USDA will use to determine if a market for a specific type of material in a specific wood basin exists. To date, the agency has not released information detailing how this determination will be made. Regardless of how these decisions are made, however, there are likely to be significant disagreements about the findings.

A more serious obstacle could be the 112th Congress. The Omnibus Spending Bill that was before Congress in the lame duck session of the 111th Congress, contained a provision that essentially defunded the bill.

According to an article by Anna Austin in Biomass Power and Thermal:Section 749 of the omnibus states, “none of the funds appropriated or made available by this or any other act shall be used to pay salaries or expenses of personnel to administer the Biomass Crop Assistance Program as authorized by 9011 of Public Law 107.171 in fiscal year 2011.”

While the provision does not specifically remove money for funding the program, it does do so for administrative expenses, which would effectively kill the program since USDA is not allowed to administer a program without a budget, according to Tom Kimmerer, senior scientist at Moore Ventures LLC. “The Omnibus does reduce direct BCAP spending by $134 million, or about half. It also rescinds unobligated funding balances for the Biorefinery Assistance program and Bioenergy Program for Advanced Biofuels [about $84 million]-all of which are USDA programs,” he said.

Fortunately, House Majority Leader Harry Reid could not find enough support for the Omnibus Spending Bill and decided not to bring the bill up for a vote in the Senate. Instead, the Congress passed a temporary spending bill to keep the government running another 10 weeks-until the beginning of March. After the holiday recess, the 112th Congress will take up a new version of the bill. Whether BCAP will fare any better in that version of the bill is anyone’s guess. Many in the freshman class of Congress were elected to deal with budget issues, however, so the legislators are likely to be much more serious about cutting spending.

Kimmerer suggests that those concerned about BCAP funding contact their legislators. Again, from Biomass Power and Thermal: “Cuts to other farm bill programs are minimal, Kimmerer pointed out. ‘So somebody was targeting the biomass industry,’ he said. ‘Though the omnibus is not in final form, people concerned about BCAP need to contact their legislators.’”

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Extpub | by Dr. Radut