A new bill introduced in the U.S. House of Representatives aims to strengthen America’s leadership in renewable energy and rural economic development by expanding federal support for biorefineries, renewable chemicals, and biobased product manufacturing.
The “Agricultural Biorefinery Innovation and Opportunity Act of 2025,” sponsored by Rep. Zach Nunn of Iowa and Rep. Nikki Budzinski of Illinois, proposes significant amendments to Section 9003 of the Farm Security and Rural Investment Act of 2002. The legislation is designed to accelerate the development and commercialization of advanced biofuels, including ultra-low-carbon and zero-carbon bioethanol, alongside renewable chemicals and biobased products.
Key Provisions of the Bill
- Expanded Scope and Definitions: The bill broadens eligibility for federal assistance to include not only advanced biofuels but also renewable chemicals and biobased products.
- Year-Round Loan Guarantees and New Grant Program: The U.S. Department of Agriculture (USDA) would be authorized to issue loan guarantees on a year-round basis and, for the first time, offer competitive grants to support the development, construction, or retrofitting of pilot and demonstration-scale biorefineries.
- Priority Scoring for Grants: Grant applications will be evaluated using a priority scoring system that considers factors such as market potential, private investment, innovative use of feedstocks or technology, partnerships with producer associations, positive environmental and public health impacts, rural economic development potential, scalability, and contributions to domestic energy security.
- Cost-Sharing Requirements: Grants may cover up to 60% of project costs, with the remaining non-federal share allowed in cash or material contributions (material capped at 30% of the non-federal share).
- Waivers for Proven Technologies: The USDA Secretary would have the authority to waive feasibility study requirements for projects utilizing commercially available or proven technologies, streamlining the approval process.
- Increased Funding Authorization: The bill authorizes $100 million per year for fiscal years 2026 through 2030 to support the expanded program, providing a multi-year funding commitment for industry growth.
Supporters argue the bill will help rural communities by fostering local economic development, creating jobs, and supporting farmer-led cooperatives. By incentivizing innovation in renewable fuels and chemicals, the legislation also aims to reduce greenhouse gas emissions and enhance U.S. energy security.
The legislation is now under consideration in the relevant House committee.
