House Includes Relief For Ethanol Industry In HEROES Act

  • Tuesday, 12 May 2020 14:54

The latest coronavirus relief package introduced in the US House of Representatives includes the Renewable Fuel Reimbursement Program which provides financial relief for the ethanol industry.

Under the HEROES Act, a Renewable Fuel Reimbursement Program will be established in the US Department of Agriculture (USDA) to make payments to renewable fuel or advanced biofuel producers that experienced unexpected market losses as a result of the COVID-19 pandemic from Jan 1, 2020 through May 1, 2020. 

The program will pay ethanol producers 45 cents per gallon of ethanol produced during the period.

For ethanol producers that have not been able to produce ethanol throughout one or more months during the aforementioned period due to the pandemic, they would recieve 45 cents multiplied by 50 percent of the number of gallons they produced in the corresponding month or months in 2019. 

On May 11, Rep. Cindy Axne (IA), Rep. Angie Craig (MN), Rep. Cheri Bustos (IL) and Rep. Abby Finkenaur (IA) sent a letter to House leaders to include relief funds from the USDA in the HEROES Act. 

"Already nearly 150 U.S. biofuel plants are fully idle or have cut production as the Energy Information Administration (EIA) reports that demand for motor fuel, and by extension ethanol and biodiesel, has fallen by nearly half, to a 50-year low. Multiple studies report that ethanol demand is expected to be approximately 3 billion gallons less in 2020 than otherwise expected, and sales could fall by 46 percent, more than a $10 billion drop," they wrote.

The letter was also signed by six other members of the House, including Minnesota's Rep. Collin Peterson.