USDA Sets Aside $14 Million to Support Higher Biodiesel Blending

May 5th, 2020 - 3:55 pm

A notice published today in the Federal Register states that the U.S. Department of Agriculture is making available up to $100 million in grants under the Higher Blends Infrastructure Incentive Program (HBIIP). Of that $100 million, $14 million is reserved for projects that support higher biodiesel blending (greater than 5%). The HBIIP offers eligible applicants cost-share grants of up to 50% of a blending infrastructure project's cost, not to exceed $5 million.

According to the Federal Register notice, heating oil and diesel fuel distributors looking to blend biodiesel at higher levels (e.g., B10, B20 or higher) are eligible for this program.

"Owners of transportation fueling and fuel distribution facilities located in the United States and its territories may apply for this program. Eligible entities would include--fueling stations, convenience stores, hypermarket retailer fueling stations, fleet facilities, and similar entities with equivalent capital investments, as well as fuel/biodiesel terminal operations, midstream partners, and heating oil distribution facilities or equivalent entities."

Grant applications will be made available via the HBIIP website once the electronic application system has been finalized. Those interested in applying are strongly encouraged to sign up for email updates from USDA.

Creation of the HBIIP was supported by NEFI and others in the home heating and renewable fuel industries. In its comment letter to the USDA earlier this year, NEFI successfully advocated for the inclusion of "heating oil distribution facilities" in the program. Federal incentives will be essential as the industry transitions to low carbon and, eventually, net-zero renewable liquid heating fuels under the "Providence Resolution."

Installation/retrofitting of required dispensers or pumps, related or attached equipment, and underground storage tank systems components are just a few of the projects that may be eligible for cost-share grants. According to the National Biodiesel Board, "State programs for higher blends infrastructure may be counted as part of the matching contribution requirement."

NEFI will continue to advocate for and support loans, grants, tax breaks, and other infrastructure incentives to support higher biofuel blends in the heating oil market; from terminal to homeowner.