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USDA Begins Accepting Applications for $100 Million in Biofuel Infrastructure Grants

U.S. Department of Agriculture (USDA) is accepting applications for $100 million in grants to increase the sale and use of biofuels derived from U.S. agricultural products. USDA is making the funding available through the Higher Blends Infrastructure Incentive Program (HBIIP). This program seeks to market higher blends of ethanol and biodiesel by sharing the costs to build and retrofit biofuel-related infrastructure such as pumps, dispensers and storage tanks.

“Biofuels are homegrown fuels. Expanding the availability of higher-blend fuels is a win for American farmers, the rural economy and hardworking Americans who pay the price here at home when we depend on volatile fuel sources overseas,” USDA Secretary Tom Vilsack said.

USDA Rural Development New Jersey State Director Jane Asselta said, “The HBIIP is a great opportunity for New Jersey’s fuel station owners to receive grant funding to upgrade fuel equipment and other station infrastructure to expand their service options to include renewable fuels. In the first round of funding earlier this year, we announced $340,000 in grant investments for three service locations. With this new funding announced by the Secretary, we’re hoping more station owners will take advantage of the grant assistance and get into the renewable fuels market.

This additional funding follows an April investment of $5.6 million through HBIIP that is expected to increase the availability of biofuels by 59.5 million gallons per year in California, Delaware, Illinois, Maryland, New Jersey, New York and South Dakota.

In June, USDA also announced that it had provided $700 million in relief funding to more than 100 biofuel producers in 25 states who experienced market losses due to the pandemic.

These investments reflect the goals of President Biden’s Inflation Reduction Act, which addresses immediate economic needs and includes the largest ever federal investment in clean energy for the future. The law includes another $500 million aimed at increasing the sale and use of agricultural commodity-based fuels. This funding will allow USDA to provide additional grants for infrastructure improvements related to blending, storing, supplying, and distributing biofuels.

The $100 million available now will support a variety of fueling operations, including filling stations, convenience stores, and larger retail stores that also sell fuel. The funds will also support fleet facilities including rail and marine, and fuel distribution facilities, such as fuel terminal operations, midstream operations; and/or distribution facilities, as well as home heating oil distribution centers.

The grants will cover up to 50 percent of total eligible project costs—but not more than $5 million—to help owners of transportation fueling and fuel distribution facilities convert to higher blends of ethanol and biodiesel. These higher-blend fuels must be greater than 10 percent for ethanol and greater than five percent for biodiesel.

Applications must be submitted by 4:30 p.m. ET November 21, 2022. Visit the HBIIP webpage to learn more, sign up for webinars and apply. Additional information is available on or page 51641 of the August 23, 2022, Federal Register.