U.S. Secretary of Agriculture Tom Vilsack announced new financial incentives for the biofuel industry Thursday while advocating for Congress to pass a short-term extension of the subsidy for corn ethanol. "Vilsack used a National Press Club speech Thursday to call for accelerating development of next-generation biofuels that would be made from crop residue, switchgrass and other feedstocks besides corn," Philip Brasher of the Des Moines Register reports. Among the incentives Vilsack announced were grants for new E15 gas-station pumps.
"Vilsack set a target of installing at least 10,000 of the pumps over the next five years," Brasher writes. "The Agriculture Department plans to offer matching grants for the pumps starting next year." Vilsack also called for construction on at least one new advanced-biofuel refinery in each region of the U.S. by the end of 2011. "Vilsack offered no help to advanced-biofuel producers on one of their top priorities -- federal loan guarantees," Brasher writes. "The next-generation plants will cost many times as much as corn ethanol distilleries do, and existing rules for the loan guarantees are too strict, deterring investment, industry groups said in a letter to the White House on Thursday."
Guarantees are currently limited to 80 percent of a project's cost. "Vilsack said he's reviewing the rules for the guarantees but that it would be costly to liberalize them," Brasher writes. Vilsack endorsed the extension of the corn ethanol subsidy but didn't say how large it would be. "Vilsack's moves to aid the ethanol industry come as many rural House Democrats are struggling to win election, including Reps. Leonard Boswell in Iowa and Stephanie Herseth Sandlin in South Dakota," Brasher writes. (Read more)
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