OPINION: Funds for higher ethanol blends in USDA’s HBIIP pocket

By Ron Lamberty, senior vice president, American Coalition for Ethanol | May 07, 2020

On May 5, the U.S. Department of Agriculture released details on the Higher Blends Infrastructure Incentive Program (HBIIP) they announced earlier this year. The program will award up to $100 million in grants for biofuels infrastructure, with $86 million targeted toward improving availability of fuels containing higher percentages of ethanol like E15 and E85. Like the Biofuels Infrastructure Partnership (BIP) program of several years ago, USDA is offering matching funds to station owners who convert, upgrade or install new equipment to sell higher ethanol blends. Unlike that program, the application window will be open three times as long.

ACE took part in stakeholders’ meetings with USDA throughout the process of developing the HBIIP and emphasized single-store and small chain retailers as being critical to widespread availability and use of E15 and flex fuels. We were pleased to see the final program includes a “Targeted Assistance Goal” (TAG), which makes 40 percent of funds available specifically for applicants owning 10 fueling stations/locations or fewer. USDA also offers applicants “consideration for geographical diversity and markets underserved by higher blends,” which will help establish higher blend retail facilities in cities and states not currently offering E15 or flex fuels; a recommendation ACE shared with USDA after retailers told us nationwide availability of E15 was key to consumer acceptance of the new fuel.

Many existing stations could add E15 using mostly existing equipment, and USDA structured the HBIIP grants so all fuel retailers — including single store and small chain owners — can receive assistance whether they perform simple conversions or want to install new equipment. ACE can assist stations in determining if their equipment is compatible, and what new infrastructure they may need if some equipment is not. Once the cost of adding higher blends is established, ACE can assist retailers with the grant application process, which USDA has assured us they have simplified as much as possible for a federal grant program. ACE will help retailers navigate the grant process by providing expertise, and when needed, financial assistance, giving stations the best chance of receiving grant funding.

As a long-time c-store owner and operator myself, and working with many other station owners who have added E15 and flex fuels to their stations, we understand what goes into making a big decision like adding a new grade of fuel. Whether you’ve got questions, or already know what you want and need help completing your project, ACE and our fuel-marketer-focused website flexfuelforward.com, have answers and are ready to help. Feel free to contact ACE at rlamberty@ethanol.org, or cbeck@ethanol.com, or call us at (605) 334-3381.

From its inception, ACE's market development program has focused on helping station owners, primarily single store and small chain retailers, understand ethanol as an easy product addition that can provide a competitive advantage and a healthier bottom line. The HBIIP is another opportunity to offer your customers the new, clean ethanol fuels of the future, and ACE looks forward to helping you add them to your fuel slate.