SECRETARY KAWAMURA URGES FARMERS TO PARTICIPATE IN USDA BIOMASS PROGRAM

SACRAMENTO, September 14, 2009 – The USDA’s Farm Service Agency (FSA) has announced that biomass conversion facilities may begin to apply for qualification under the Biomass Crop Assistance Program (BCAP).  This allows farm producers or owners of eligible material who sell to these facilities to apply for matching payments under the collection, harvest, storage and transportation (CHST) component of BCAP, which provides financial assistance to owners of eligible material who deliver the material to qualified biomass conversion facilities that use biomass to produce heat, power, biobased products or advanced biofuels. 

An eligible material owner may be eligible for a matching CHST payment for eligible material delivered to a qualified biomass conversion facility which will be paid at a rate of $1 for $1 per dry-ton equivalent received from a qualified biomass conversion facility, not to exceed $45 per dry-ton equivalent.  An eligible material owner may receive payments for a period of two years.  The purpose of the matching payments is to assist biomass producers with the CHST cost of delivering biomass to a qualified biomass conversion facility.

For example, if a qualified biomass conversion facility pays a producer $30 per dry ton for biomass, the eligible material owner or producer would be able to apply for a matching payment of $30 per dry ton from FSA.
 
“We applaud the USDA for providing more biomass incentives,” said CDFA Secretary A.G. Kawamura. “This is a progressive option for power generation and waste management, and I urge all who may benefit to strongly consider this program.”

Biomass conversion facilities may become “qualified” by signing an Agreement with FSA state offices.  The Agreement generally provides the framework that facilitates the making of CHST matching payments to eligible material owners or producers who plan to deliver biomass to that facility.

After a biomass conversion facility becomes “qualified” by signing an Agreement with FSA, eligible material owners or producers, who market eligible material to that biomass conversion facility, must apply for the CHST matching payment program at their nearest FSA county office before the eligible material is delivered.  Eligible material owners must also provide a copy of their delivery agreement with the qualified biomass conversion facility as part of the application for a CHST matching payment.  After the product is delivered, a producer must provide FSA with documentation of product quantity, quality, and payment rate.  County offices will verify payment request information with the qualified biomass conversion facilities. 

Interested biomass conversion facilities should contact their FSA state offices for further information and can visit http://www.fsa.usda.gov/energy to download and review the Agreement. 

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