It ain’t over ‘til it’s over, as they say, but on January 27, the House and Senate Agriculture Committees released the long-awaited conference report of the 2014 Farm Bill and it provides $881 million in mandatory funding for the Energy Title
IX programs. This means, for the very first time, it contains significant language for “renewable chemicals,” therefore providing tremendous benefits for our renewable chemical innovative technologies, domestic manufacturing, and creating jobs in U.S.!
A vote in favor is still needed from the full House and Senate. This hasn’t always been such an automatic thing. As you know, House and Senate leadership can simply stall any bill from being voted upon in either chamber, or both. But reports are that both House Speaker John Boehner and Senate Majority Leader Harry Reid are signaling that they plan to bring the legislation up for a vote in the next few weeks, and Congress is expected to enact it.
Courtesy of ML Strategies, LLC, which is a government relations consulting group and a trusted resource for Myriant, we have received the following three bullet points which summarize the critical importance of this conference report for companies in the renewable biochemicals industry:
•The legislation would create a statutory definition of renewable chemical.
•The Biopreferred program, which creates a federal demand for biobased and forestry products, is amended and expanded.
•Eligibility for the Biorefinery Assistance Program (Sec. 9003) is expanded from biofuels to include renewable chemical and biobased product manufacturing as well. One hundred million dollars of mandatory spending is available in FY 2014, and $50 million per year is available in FY 2015 and 2016. The loan guarantee program leverages private investment so that the $200 million in mandatory funding can effectively support an even larger number of loan guarantees. Typically, the credit subsidy costs of the loan guarantees (meaning the cost to the government when evaluating the risk of default) averages about 30 percent, so the $200 million in total mandatory funding could leverage upwards of $700 million in loan guarantees. Up to 15 percent of the funding for loan guarantees can be used to cover the expenses for renewable chemical and biobased manufacturing.
In short—this is huge!
Much thanks, by the way, is due the Biotechnology Industry Organization (BIO) which represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations. It has been working tirelessly and obviously quite effectively to foster this legislative initiative.