USDA Announces Funding to Convert Biomass to Energy

HALIFAX, Va., Nov. 17, 2011 –Deputy Agriculture Undersecretary for Rural Development Doug O'Brien today announced that USDA is funding a series of projects to convert biomass to energy through USDA's Rural Energy for America program. (REAP). The announcement was made during an event in Halifax, Va., to mark USDA Rural Development's participation in construction of a biomass plant to be operated by the Northern Virginia Electric Cooperative (NOVEC).

"The Obama Administration is assisting cooperatives, small businesses, farmers and ranchers, as they work to reduce their energy costs," said O'Brien. "When energy costs are reduced, American rural businesses become more competitive, allowing them to expand and create jobs."

For example, NC-CHP Owner I, LLC of Asheville, N.C., received a $5 million loan for the installation of a combined heat and power system in Montgomery County. The system will generate steam by using a boiler system powered by wood chips and will also generate 5.25 million kWh of electricity per year. Also in Montgomery County, applicant EWP, LLC will receive a $146,000 grant to install equipment at an existing hydroelectric plant so it can be reopened. The project has the potential to generate an estimated 2.8 million kWh per year.

Today's announcement concludes 2011 biomass project funding assistance for a total of 52 projects with just over $31 million in grant and loan note guarantees through the Rural Energy for America Program. This support helped to leverage a total of $154.5 million of biomass project development in 26 states which will help produce clean, renewable heat and power for farms and small businesses in rural America. A complete list of funding recipients announced today follows:

Alaska Alaskan Brewing LLC $448,366 grant Biofuel from waste grain

N.C. EWP LLC $146,281 grant Hydro

N.C. NC-CHP Owner I, LLC $5 million loan Wood to energy

Iowa Iowa Firewood Products $24,232 grant Firewood kiln

Mass. CommonWealth Resource $49,875 grant Biofuel from waste

S.D. Legend Seeds, Inc. $17,035 grant Boiler installation

Tenn. Mountain Wood Products $500,000 grant Wood Pellet Processing

Utah Washakie Renewable Energy $496,750 grant Biofuels pretreatment/ products plant

USDA funding is contingent on the recipient meeting the conditions of the grant or loan agreement. REAP grants can finance up to 25 percent of a project's cost, up to $500,000 for renewable energy systems and $250,000 for energy efficiency improvements.

Since taking office, President Obama's Administration has taken historic steps to improve the lives of rural Americans, put people back to work and build thriving economies in rural communities. From proposing the American Jobs Act to establishing the first-ever White House Rural Council – chaired by Agriculture Secretary Tom Vilsack – the President wants the federal government to be the best possible partner for rural businesses and entrepreneurs creating job opportunities and for people who want to live, work, and raise their families in rural communities.

USDA, through its Rural Development mission area, administers and manages housing, business and community infrastructure and facility programs through a national network of state and local offices. Rural Development has an active portfolio of more than $155 billion in affordable loans and loan guarantees. These programs are designed to improve the economic stability of rural communities, businesses, residents, farmers and ranchers and improve the quality of life in rural America.

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