12/22/09: BCAP, Chinese RPS

Tuesday, December 22, 2009

In Maine news, the USDA Biomass Crop Assistance Program (BCAP) continues to make news. This is "news" because the story is in the news media today. What's not in the news story is that the BCAP notice of funds for availability (NOFA) came out back in June. (In fact, this fall, I attended the FSA's presentation of BCAP to the Forest Resources Association of Maine (FRA), a group of landowners, managers, loggers, and fiber purchasers.)

Also not in the news is that this is more like the production tax credit than it is like broadband funding, in that it is an entitlement as opposed to a competitive program. Once both buyer and seller are registered under BCAP, the seller is entitled to a matching payment from USDA of up to $45 per dry ton of eligible material delivered. (Example: Joey has been selling wood to BioBuyer at $50 per dry ton. With BCAP, Joey can sell the wood to BioBuyer for $25/ton and get a check from Uncle Sam for $25/ton, keeping Joey whole and making BioBuyer happy. In practice, the savings can be split between buyer and seller.) Note that eligible generally means sustainably harvested and without a "higher use".

You can see who's registered as a buyer here.

In Maine, BCAP buyers include LP&T, Katahdin Paper, Corinth Wood Pellets, Greenville Steam, Verso Bucksport and Andro, Boralex (multiple), Domtar, Covanta (multiple), Redshield, Maine Wood Pellets, Rumford Paper, Sappi (both mills), Louisiana Pacific, Lucerne Farms, and Irving Forest Products.

Meanwhile, the Chinese legislature is considering a renewable portfolio standard -- but it sounds like it is at a very preliminary stage.

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