Biomass Incentives Intended to Lure Farmers

March 17, 2010 07:00 PM
 

Gary Kass, Farm Journal Proofreader

Demand for biomass is increasing. The U.S. Renewable Fuels Standard mandates that 100 million gallons of cellulosic fuel be used as transport fuel in 2010 and 16 billion gallons by 2022. But producers are reluctant to enter the market, says Jody Endres of the University of Illinois' Energy Biosciences Institute. "Perennials require long-term commitment, novel agronomic practices, unique harvesting equipment and offer little carbon price incentive,” she explains. But, she adds, the Biomass Crop Assistance Program (BCAP) can help reduce the risk.

BCAP, authorized in the 2008 farm bill, has two parts. The Collection, Harvest, Storage and Transportation (CHST) program makes matching payments upon delivery of biomass crops to a qualified conversion facility. The material can come from federal, private or Indian lands, with some exclusions, including Title I crops. The Farm Service Agency began issuing payments this past fall, paying farmers $1 per dry ton paid by the facility, up to $45 per ton.

The second part, the Project Areas program, awaits implementation while the USDA designates project areas. Farmers will receive up to 75% of perennial establishment costs and an undetermined amount for perennial or annual production. Unlike CHST, the only eligible land will be private land not used for the Conservation Reserve Program, Wetlands Reserve Program or Grassland Reserve Program and that has not had native sod after May 22, 2008. Title I crops and crops deemed noxious or invasive by federal or state law are also excluded.

A regulation for CHST and Project Areas was issued in early February, followed by a 60-day public comment period. "It's important to take advantage of the comment period,” Endres says. "Where those project areas land is a high-stakes result.” For more, visit www.fsa.usda.gov/FSA/.



You can e-mail Gary Kass at gkass@farmjournal.com.

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