Applications being accepted for USDA's Biomass Crop Assistance Program

By Erin Voegele | July 08, 2009
Report posted Aug. 3, 2009, at 5:10 p.m. CST

On July 29, the USDA Farm Service Agency announced that biomass conversion facilities can begin signing up to participate in the Biomass Crop Assistance Program. The program, which was authorized in the 2008 Farm Bill, was created to support the production of eligible crops for the conversion to biofuels or bioenergy. BCAP accomplishes this by providing financial assistance to collect, harvest, store and transport eligible materials.

According to information released by Michael Best & Friedrich LLP, under the program the USDA will provide financial assistance to biomass producers who sell their crops to qualified biomass conversion facilities for up to 75 percent of the cost of establishing and planting eligible biomass crops within a BCAP project area. In addition, the USDA will provide annual payments to help compensate for lost opportunity costs until the crops are established, and will provide further financial assistant for the collection, harvest, storage and transportation of biomass crops by matching the amounts paid to producers by the biomass conversion facility, up to $45 per dry ton.

Qualified biomass conversion facilities include those that convert eligible material into heat, power, biobased products or advanced biofuels. A biomass conversion facility can become qualified by submitting a Memorandum of Understanding to the FSA state offices. Once an agreement is signed between the FSA and biomass conversion facility, and funding through the program is provide, the biomass conversion facility can begin accepting materials.

Eligible material owners or producers, who market eligible material to a qualified biomass conversion facility, may apply for the matching payment for collection, harvest, storage and transportation at their FSA county office. An application must be submitted before the eligible material is sold and delivered to a qualified biomass conversion facility. After the product is delivered, a producer must provide FSA with documentation of product quantity, qualification and payment rate. County offices will validate payment requests with information in the county office and information provided under the terms of MOUs and with the qualified biomass conversion facilities. These matching payments will not be authorized until after an appropriate environmental analysis has been conducted.

"This program will benefit producers, the developing biomass industry, the general public and the environment as we continue working to expand production and availability of renewable energy," USDA FSA Administrator Jonathan Coppess said.