[Federal Register Volume 73, Number 225 (Thursday, November 20, 2008)]
[Proposed Rules]
[Pages 70542-70543]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-27203]



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Part IV





Department of Agriculture





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 Rural Business-Cooperative Service



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7 CFR Part 5001



BioRefinery Assistance Program; Proposed Rule



Notice of Funds Availability (NOFA) Inviting Applications for 
Biorefineries; Notice

  Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / 
Proposed Rules  

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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service

7 CFR Part 5001

RIN 0570-AA73


BioRefinery Assistance Program

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Advanced notice of proposed rulemaking.

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SUMMARY: This Advanced Notice of Proposed Rulemaking (ANPRM) seeks 
comments for the development of a proposed rule to implement a 
BioRefinery Assistance guaranteed loan program. In conjunction with 
this ANPRM, USDA is publishing a separate notice in this Federal 
Register announcing a Notice of Funds Availability (NOFA) for a 
BioRefinery Assistance Program to provide guaranteed loans for the 
development and construction of commercial-scale biorefineries or for 
the retrofitting of existing facilities using eligible technology for 
the development of advanced biofuels. The comments being sought under 
this ANPRM reference the biorefinery assistance program described in a 
separate notice published elsewhere in this issue of the Federal 
Register.

DATES: Please submit your comments by January 20, 2009.

ADDRESSES: You may submit comments by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail: Submit written comments via the U.S. Postal Service 
to the Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, STOP 0742, 1400 Independence Avenue, SW., 
Washington, DC 20250-0742.
     Hand Delivery/Courier: Submit written comments via Federal 
Express Mail or other courier service requiring a street address to the 
Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, 300 7th Street, SW., 7th Floor, Washington, 
DC 20024.
    All written comments will be available for public inspection during 
regular work hours at the 300 7th Street, SW., 7th Floor address listed 
above.

FOR FURTHER INFORMATION CONTACT: U.S. Department of Agriculture, Rural 
Development, Energy Branch, Attention: BioRefinery Assistance Program, 
1400 Independence Avenue, SW., STOP 3225, Washington, DC, 20250-3225. 
Telephone: (202) 720-1400.

I. Background

    The purpose of section 9003 of the Food, Conservation, and Energy 
Act of 2008 (2008 Farm Bill) is to assist in the development of new and 
emerging technologies for the development of advanced biofuels in order 
to increase the energy independence of the United States; promote 
resource conservation, public health, and the environment; diversify 
markets for agricultural and forestry products and agriculture waste 
material; and create jobs and enhance the economic development of the 
rural economy. Thus, the purpose of the program presented in this NOFA 
is to assist in the development and construction of commercial-scale 
biorefineries and the retrofitting of existing facilities using 
eligible technology for the development of advanced biofuels. To that 
end, the program will promote the development of the first commercial 
scale biorefineries that do not rely on corn kernel starch as the 
feedstock. Preference for funding will be given to projects where 
first-of-a-kind technology will be deployed at the commercial scale.
    The Agency will make guarantees available on loans for eligible 
projects that will provide for the development, construction, and/or 
retrofitting of commercial biorefineries using eligible technology. 
Eligible technology is (a) any technology that is being adopted in a 
viable commercial-scale operation of a biorefinery that produces an 
advanced biofuel and (b) any technology not described in (a) above that 
has been demonstrated to have technical and economic potential for 
commercial application in a biorefinery that produces an advanced 
biofuel.
    Over the life of the program, it is likely that guarantees will be 
awarded to projects that are first-of-a-kind or projects with 
commercial applications that are expanded to new regions, modified to 
utilize different feedstocks.

II. Agency Intent

    The Agency plans to issue a proposed rule for the BioRefinery 
Assistance guaranteed loan program, which is expected to be very 
similar to the requirements laid out in the aforementioned biorefinery 
assistance program NOFA. Consistent with the Agency's intent to develop 
a single, unified guaranteed loan regulation to reduce burden and 
simplify the requirements of the Agency's guaranteed loan programs, the 
Agency intends to incorporate the BioRefinery Assistance guaranteed 
loan program into the proposed guaranteed loan program under 7 CFR part 
5001 when that program is promulgated.
    To assist the Agency in developing a proposed rule for the 
BioRefinery Assistance guaranteed loan program, the Agency is seeking 
input from interested parties on the questions detailed in Section III 
below.

III. Questions

1. Definitions/Terms (Section II.A. in the Biorefinery Assistance 
Program NOFA and Section 9003 of the 2008 Farm Bill)

    The Agency is seeking comments on how the following two phrases 
should be defined as used in the definition of ``eligible technology'' 
as that term is defined in the 2008 Farm Bill:
     ``Viable commercial-scale operation''
     ``Technical and economic potential for commercial 
application''
    One of the priorities in the 2008 Farm Bill for scoring guaranteed 
loan applications is ``whether the applicant has established a market 
for the advanced biofuel and the byproducts produced.'' In the context 
of this scoring priority, the Agency is seeking comment on defining the 
following:
     ``Established a market''
     ``Byproducts''
     ``Co-product'' and its relationship to byproduct.
    A second priority in the 2008 Farm Bill for scoring guaranteed loan 
applications is ``the level of local ownership proposed in the 
application.'' In the context of this scoring priority, the Agency is 
seeking comment on defining the following:
     ``Local ownership''
    A third priority in the 2008 Farm Bill for scoring guaranteed loan 
applications is ``whether the area in which the applicant proposes to 
place the biorefinery has other similar facilities.'' In the context of 
this scoring priority, the Agency is seeking comment on defining the 
following:
     ``Area''

2. Oversight and Monitoring (Section II.E. in the Biorefinery 
Assistance Program NOFA)

    What information and reports should be required once the project is 
established and stabilized? How should performance of the project/
technology be evaluated and by whom? For example, Should there be a 
technology-specific protocol that is evaluated by an independent third 
party?

3. Eligible Borrowers (Section II.G. in the Biorefinery Assistance 
Program NOFA)

    Given that much of the funding for National Laboratories comes from

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Federal sources, which reduces the likelihood of their being awarded a 
loan guarantee under this program, what should their role in the 
program be?

4. Loan Applications (Section II.J. in the Biorefinery Assistance 
Program NOFA)

    Should a separate technical report be required, what information 
would it contain, who would be qualified to complete it, and who would 
be qualified to review it? Would the applicant be willing to pay the 
cost of the environmental impact analysis?
    What is the potential value added to the program, in support of the 
Agency's responsibilities for project credit assessment, in requiring a 
private sector credit rating on the biorefinery project as if the total 
debt anticipated in support of the project were not subject to Federal 
guarantees?

5. Evaluation of Guaranteed Loan Applications (Section II.K. in the 
Biorefinery Assistance Program NOFA)

    Should specific scoring criteria carry more weight than others?
    Should other evaluation criteria be considered?
    How should the impacts on resource conservation, public health, and 
the environment, and the potential for rural development be evaluated?
    Should priority consideration be given to technologies that add 
significant value to low-value feedstock even if it adversely impacts 
existing low-value added facilities that use similar feedstock?
    In consideration of the 100 point scoring protocol depicted in the 
NOFA, at what level should the Agency set a minimum score in order for 
an application to receive consideration by the Agency for a potential 
guarantee?

6. Lender's Functions and Responsibilities--Origination (Section II.N. 
in the Biorefinery Assistance Program NOFA)

    Credit Evaluation. Are the requirements of the lender's credit 
analysis found in paragraph (a), Credit evaluation, of Section II.N. 
adequate?
    Equity. What should the equity requirements be? Should there be 
minimum equity requirements that may vary depending on the size of the 
project? Will it differ between construction and development versus 
retrofitting?

7. Basic Guarantee and Loan Provisions (Section II.Q. in the 
Biorefinery Assistance Program NOFA)

    Project cost. What are eligible project costs?
    Issuance of the Loan Note Guarantee. Should the Loan Note Guarantee 
be issued prior to construction or be limited to post-construction 
financing? What parameters or issues should be considered prior to 
issuance of the Guarantee?

    Dated: November 7, 2008.
Ben Anderson,
Administrator, Rural Business-Cooperative Service.
[FR Doc. E8-27203 Filed 11-19-08; 8:45 am]
BILLING CODE 3410-XY-P