07 February 2014 19:42 [Source: ICIS news]
HOUSTON (ICIS)--With the US Farm Bill set to be signed by President Barack Obama on Friday afternoon, biotechnology leaders discussed the opportunities the funding could provide in the renewable chemical industry.
The bill is the main federal agriculture and food policy legislation, which has addressed the energy sector since 2002. The 2014 bill, which governs policy for the next five years, added new language to make renewable chemical technologies eligible for all Farm Bill programmes.
“The Energy Title programs will help innovative companies speed the development of new, American-made products,” said Matt Carr, managing director of policy for the Biotechnology Industry Organization (BIO) during a roundtable on Friday.
The roundtable was hosted BIO with guests including Agriculture Energy Coalition (AEC) co-director Lloyd Ritter, DSM North America president Hugh Welsh and Renmatix senior vice president Mark Schweiker.
“We look at this as a biotechnology jobs bill,” Welsh said, adding that provisions in the bill make the US a more positive market for the investment dollars of a multinational corporation like DSM.
The inclusion of renewable chemicals in the bill and favorable provisions sends a message that the US is willing to do what it can to win the competition for renewable chemical operations, Schweiker said. “And a win means an awful lot of you look at this industry. People estimate it to be $2.5tr across the clean energy realm.”
One of the core programmes of the bill is $200m mandatory funds for biorefinery assistance. Since the funding is loan guarantees rather than grants, it could guarantee investment at about 10 to 1, Carr explained.
“For the energy programs, the significant mandatory funding is crucial,” Ritter said, adding that investment will help farmers build new markets for energy crops.
Funds from the Farm Bill programmes could be available within weeks or months, once the bill is signed, Ritter explained.
The Farm Bill also includes funding for biorefinery, renewable chemical and bio-based product manufacturing assistance - $100m in 2014 and $50m in 2015-2016. Other highlights of the bill are $25m/year for biomass crop assistance and $3m/year for biomass research and development funding.
Another of the core renewable chemical provisions is the BioPreferred Program. The first part of the initiative is certified labels for qualifying products to increase consumer recognition of bio-based products. The second part is the federal procurement preference, which gives preference to bio-based products by federal agencies.
With the federal government as the biggest purchaser of goods in the US, the preference program can make a big difference, Ritter said.
“It creates a general awareness,” Welsh said.
The Farm Bill was scheduled to be signed into law in Michigan, the home state of Stabenow, who championed the inclusion of renewable chemicals in the 2014 legislation. Before signing the Farm Bill into law, President Obama was scheduled to take a tour of the Michigan Biotechnology Institute in Lansing, Michigan.
Although the Farm Bill will have a direct impact on the US renewable chemical industry, it can also be considered a first step in creating parity with the other renewable industries. Bills in both the US House and Senate would create a production tax credit for renewable chemicals, similar to tax credits for other renewable technologies, Carr said.
“In the long term, [the Farm Bill] also establishes important policy status for renewable chemical technology, which will help in our industry’s efforts to achieve parity in other policies,” Carr said.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections