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Regulatory Alert
USDA ANNOUNCES AVAILABILITY OF $100 MILLION IN NEW HIGHER BLEND INFRASTRUCTURE GRANTS
August 24, 2022
The United States Department of Agriculture (USDA) has announced the availability of approximately $100 million in competitive grants to transportation fueling facilities for the installation and upgrade of equipment compatible higher blend renewable fuels in rural and disadvantaged areas. The goal of HBIIP is to increase the market availability of higher blend biofuels.
Under the HBIIP, funds will be awarded to assist transportation fueling and fuel distribution facilities to convert their current facilities through upgrade of existing or installation of new equipment required to ensure compatibility with ethanol blends over 10% and biodiesel blends over 5%.
Grant Distribution
The good news for energy marketers is that $75 million of the $100 million in available funding is earmarked for retail facilities. In addition, 40% of the funding earmarked for retail facilities will be made exclusively to small business energy marketers with 10 or fewer stations. The remaining $25 million will be made available to midstream transportation fuel storage and distribution facilities.
Cost Sharing
The program will share 50% of total project costs up to $2.5 million per applicant for existing retail stations. There is a matching fund requirement for applicants of at least $1 for every $1 in grant funds provided by the USDA. Matching funds plus grant funds must equal total eligible project cost.
Eligible Applicants
The funds are available for gasoline service stations, convenience stores, hypermarket fueling stations; fleet facilities, including transportation, freight, rail and marine in rural and disadvantaged areas.
Eligible Project Costs
Eligible Project Costs are only those costs incurred after the date that a complete application is submitted and that are directly related to the use and purposes of the HBIIP. The grants must be used to: upgrade or install or otherwise retrofit transportation fueling equipment including dispensers and UST system components including tanks, pumps, ancillary equipment, lines, gaskets, and sealants, and other infrastructure; fees for construction permits and licenses; and professional service fees for qualified consultants, contractors, installers, and other third-party services.
Ineligible Project Costs
Ineligible project costs for HBIIP grants include, but are not limited to: incurred expense, equipment purchase, or paid service prior to the date a complete application is submitted; renewable diesel projects; used equipment and vehicles; construction or equipment costs that would be incurred regardless of the installation of higher blend fuel infrastructure; purchase of real property or land; Lease payments, funding of political or lobbying activities; to pay off any Federal direct or guaranteed loan or any other form of Federal debt.
Anticipated Award Date:
The Department of Agriculture anticipates making awards 90 days after the application deadline.
Performance Period:
The grant period is not to exceed 36-months, unless otherwise specified in the Grant Agreement or agreed to by the Agency.
Application Information
Only one HBIIP application may be submitted per HBIIP applicant. An application may request HBIIP assistance for more than one location that is owned and/or legally controlled by the applicant entity. An HBIIP applicant may receive only one award under this grant distribution. New construction of fueling stations, locations or facilities constructed during the grant period are restricted from receiving HBIIP grant funds for underground tanks.
Application Submission
Instructions and additional resources including an application guide are available at the HBIIP website.
Application Due Date
Applications due no later than 4:30 PM Eastern time, November 21, 2022.
Got Questions?
Contact Mark S. Morgan, Regulatory Counsel at mmorgan@emamerica.org
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