The United States Department of Agriculture (USDA) has announced a US$800M support package for the biofuels sector – comprising US$700M in COVID-19 relief for producers and US$100M in infrastructure funding to support the use of higher blends of ethanol and biodiesel, Biodiesel magazine reported on 7 December.

The USDA said the US$700M in pandemic relief would be in the form of direct payments through the Biofuel Producer Program to biofuel producers who had faced unexpected market losses due to the pandemic.

“As we continue to rebuild the nation’s economy, the USDA is targeting resources and investments to improve the strength and resiliency of America’s sustainable fuel markets,” agriculture secretary Tom Vilsack said.

“The relief we’re announcing today will pave the way to economic recovery for America’s biofuel producers, stimulate a critical market for US farmers and ranchers and move the country closer to President Biden’s goal of net-zero carbon emissions by 2050.”

According to the agency, the Biofuel Producer Program would help agricultural producers maintain and create more viable markets for products that supplied biofuel production, such as corn, soyabeans and biomass.

Payments would be based on the producer’s market loss volume in 2020, which was calculated by the amount of fuel produced in 2020 when compared to the previous year, the report said.

The US$100M in infrastructure funding would go to new grants for biofuels infrastructure, including blender pumps, which the agency said ensured biofuels had greater availability in the retail market. The funding would also provide grants to refuelling and distribution facilities for the cost of installation, retrofitting or otherwise upgrading infrastructure required at a location to supply ethanol blends of E15 and above and biodiesel blends of B20 and above.

An application window for the funds would be announced within the coming months, the USDA said.

The USDA’s support package was welcomed by the Renewable Fuels Association and the American Coalition for Ethanol.

“Ethanol producers are still struggling to recover from COVID-related market losses after what has been the most difficult and trying time in the industry’s history,” RFA president and CEO Geoff Cooper said.