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Federal Biomass subsidies may get altered February 10, 2010

Filed under: Biomass,Legal/Courts,Oregon,Wood Products — nwrenewablenews @ 4:57 pm
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U.S. Rep. Peter DeFazio is seeking to have sawdust and wood shavings removed from a program that provides federal subsidies for biomass used to create energy.

In a letter to Agriculture Secretary Tom Vilsack, DeFazio said the subsidy program has resulted in mill by-products being sent to biofuel and pellet plants rather than to composite wood manufacturing plants.

With the subsidies, the value of sawdust and wood shavings has doubled, making them less valuable for manufacturing, DeFazio said. At the same time, it has driven up the cost for manufacturers needing those materials for their products.

Using taxpayer dollars to subsidize the transfer of biomass material currently used for higher-value products to lower-value processes goes against congressional intent, DeFazio said, and is having a devastating impact on the U.S. wood manufacturing industries.

His letter was also signed by Rep. Bob Latta, R-Ohio, and Rep. Travis Childers, D-Miss.

“Driving up input costs for the composite and wood manufacturing industries will negatively impact their ability to compete globally and could ultimately lead to the loss of thousands of jobs,” DeFazio wrote. “During a time of 10 percent national unemployment — with many state unemployment rates even higher — we can ill afford to lose additional family-wage, U.S. manufacturing jobs.”

The three congressmen asked the Department of Agriculture to temporarily freeze subsidies provided through the Farm Service Agency until the list of eligible materials excludes wood mill waste, scraps, sawdust, chips and shavings. They also asked Vilsack to ensure that finalized rules and regulations are in place before the program continues.

The wood manufacturing and composite industries support 21,000 family wage jobs, 350,000 indirect jobs and generate $7.9 billion in annual revenues, the letter said.

John Sowell, News Reviewhttp://www.nrtoday.com/article/20100210/NEWS/100219999/1063/NEWS&ParentProfile=1055

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