Proposed Cuts to Farm Bill Clean Energy Programs Could Hurt Economies

The Environmental Law & Policy Center says proposed cuts to the Farm Bill's clean energy programs could be harmful to rural economies.

The Congressional Conference Committee proposed to cut clean energy programs for agriculture by more than 60% in the agriculture budget for fiscal year 2012. Because the U.S. government is operating under a short-term agreement that expires on November 18 this new measure is expected to pass this week, without amendment.

Members from the House and Senate proposed deep cuts to funding for popular clean energy programs that create rural economic development and energy independence. “This is the wrong time to slash funding for programs that create jobs and rural economic development,” says Allen Grosboll, Legislative Director for the Environmental Law & Policy Center. “These cuts are a step back from solving America’s jobs and energy challenges.”

Farm Bill clean energy programs have helped thousands of farmers, ranchers and rural small businesses reduce energy costs and generate clean energy through wind, solar, biomass, energy efficiency and other projects. The cuts to these programs mean fewer jobs and less private investment in rural America.

Following is a summary of the funding cuts from the Senate-House conferees to clean energy development programs for agriculture:

Rural Energy for America Program (REAP, Section 9007):

REAP provides grants and loan guarantees for agricultural producers and rural small businesses to implement energy efficiency and a wide variety or renewable energy systems.

  • REAP cut by 64% to a total funding of $25.40 million from a $70 million authorization. This translates into a loss of approximately 750 new jobs, based on established job creation rates for REAP.

Bioenergy Program for Advanced Biofuels (Section 9005):

The Bioenergy Program for Advanced Biofuels provides production payments for producers of “advanced biofuels,” which excludes corn ethanol.

  • Bioenergy Program for Advanced Biofuels cut by 62%, to $65 million, from a $105 million authorization.

Biomass Crop Assistance Program (BCAP, Section 9011):

BCAP provides cost-share funding to establish and purchase first generation energy crops such as prairie grasses. BCAP was funded in the 2008 Farm Bill as “such sums as are necessary.”

  • BCAP was capped at $17 million, while it was administratively capped at $112 million in the 2011 fiscal year, a reduction in the cap of 85%.