FINANCE the University of Alberta and a biomass industry expert. In terms of demonstrated technology, biomass power is more developed than other biomass endeavors, Flynn says, but is behind in the U.S. when it comes to implementation. It’s ahead of biofuel and ethanol development in other countries such as Finland, Flynn says. The George W. Bush administration focused mainly on reducing dependence on foreign oil, with a lukewarm approach to greenhouse gas (GHG) emissions, he adds. “I think under the current administration, the focus has shifted to broaden the mandate,” he says. “That, I think, will shift the focus to a mix of biomass power and fuels from biomass.” Biomass electricity projects were eligible to receive Production Tax Credits under the Bush administration, as well, but the main factor in the change is that the cash grant opportunity makes renewable electricity projects more appealing, Bertrand and Ptacek agree. “It’s clear that this administration has decided to emphasize biomass power,” Bertrand says.
More Federal Funding The federal government has a plethora of funding opportunities besides the cash grants. The U.S. DOE’s Loan Guarantee Program is well-known and heavily utilized. It’s designed to provide fourthstage financing in the form of loan guarantees to commercial-scale innovative renewable technologies that avoid, reduce or sequester GHGs and air pollutants. The loan cannot exceed 80 percent of total project costs. The program includes two key elements: Section 1703, established as Title XVII under the Energy Policy Act of 2005, and Section 1705, an amendment included in the American Recovery and Reinvestment Act of 2009. The former supports eligible projects that are unable to obtain conventional private funding because of
high technology risks, while the latter supports renewable energy, transmission and leading-edge biofuels projects that will commence construction by Sept. 30, 2011, according to the DOE. The program periodically issues requests for proposals, or solicitations, for various categories, such as innovative technologies, encompassing new or significantly improved technologies. The DOE has several focus areas in biomass projects for the Loan Guarantee Program, including cellulosic ethanol, biomass to syngas, electricity or diesel, and bio-oil-derived fuel, says Dan Tobin, senior investment officer with the Loan Guarantee Program. “In addition, applicants should look at alternative feedstocks,” he says, adding that the DOE is not focused on providing funding for projects that use corn as a feedstock. Projects that utilize 50 to 70 dry tons of biomass per day (considered demonstration scale) or more will be favored in the competitive program. In the biofuels area, the DOE is favoring innovative projects that have not been deployed commercially in the U.S., but have been piloted and demonstrated successfully. “It’s in the best interest of the applicant to submit applications that show life-cycle GHG emissions,” Tobin adds. In 2008, biomass projects made up 24 percent of all renewable energy applications submitted to the program, second only to solar at 31 percent, according to the DOE. Applications also were submitted for hydrogen, wind and geothermal technologies, among others. The application process includes an overview of the project, along with more detailed information later. DOE would also like to see a detailed plan by the project sponsor for mitigating market risk and to provide the agency with a reasonable assurance of loan repayment. For more information on the Loan Guarantee Program, visit www.lgprogram.energy.gov/. The Web site includes suggestions for strong applications.
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