NSAC suggests REAP, BCAP changes

By Anna Austin | March 22, 2012

The National Sustainable Agriculture Coalition has released its 2012 Farm Bill platform, which provides suggestions to improve some federal bioenergy programs. These include the Repowering Assistance Program and the Biomass Crop Assistance Program, which on March 22 released a new request for project area applications, though it currently has no funding beyond 2012.

The U.S. House Committee on Agriculture is working to reauthorize the farm bill in 2012, and is welcoming input from farmers and ranchers in advance of writing the legislation. It is hosting a series of field hearings that began in March and will end April 20, mainly to discover how U.S. farm policy is working and how it might be improved. In its platform, the NSAC has offered many suggestions.

The organization says REAP has been misused. It points out in its farm bill platform that in the April 2011 Interim Final Rule for REAP, USDA announced it will use the program as the source to pay 25 percent of the costs of flexible fuel pumps at gas stations, and that it intends to use REAP to pay some of the costs for 2,000 pumping systems each year over the next five years. “At a cost of $120,000 per pump, this initiative could use up a large portion of REAP funding,” NSAC said. “REAP is designated in the farm bill for renewable energy systems and energy efficiency grants and loans. It is a major stretch to interpret the statute as authorizing subsidization of blender pumps at gas stations."

The IFR gives the pumps a high priority for funding, the platform pointed out, and the immediate recipients of this largess will be large oil companies that blend ethanol with gasoline, which is not at all what the program is intended for. “Policy debate about transforming ethanol tax credits spending into infrastructure support is under way,” it stated. “It makes no sense to take farm bill resources dedicated to a different purpose to layer on upfront blender pump subsidies before the tax credit debate plays itself out.”

From the perspective of the NSAC, the next farm bill should focus solely on rural projects that produce bio-based, wind and solar energy. It should explicitly exclude blenders from receiving REAP money, unless the blenders are small or mid-sized locally owned companies in rural areas, and it should also add a new provision to ensure sustainability criteria. “This would encourage agricultural producers to implement production techniques that preserve the integrity of soil, water, air, and wildlife habitats,” NSAC said. “This provision should also require a showing of significant net environmental benefit and provide a preference for the development of locally owned energy projects to guarantee that communities receive real economic benefits, and that projects will be suitable for local circumstances.”

The NSAC has also made suggestions for BCAP, which currently has no baseline budget beyond its $17 million in 2012, but is accepting applications for project areas until April 23.

When the first part of BCAP—collection, harvest, storage and transport (CHST) payment—was implemented in early 2009, FSA did not hold a proposed rulemaking, which essentially resulted in multiple loopholes, unintended consequences and overspending. After spending considerable time fixing that portion of the program, a rulemaking process was held for the annual/establishment portion of the program, but the first bioenergy crop project wasn’t implemented until May 2011, NSAC pointed out. 

It suggested that the next farm bill fund BCAP at $40 million annually for 2013 through 2017, roughly the amount of money needed to fund five or six BCAP projects per year depending on their size, and eliminate the CHST component.  

Among several other suggestions, NSAC also proposed that the farm bill require annual crops to be part of a resource-conserving crop rotation; that the project component should be competitive and only available for developing new sources of energy; and that Title I commodity crop residues should not be eligible BCAP crops.