Senate Agriculture Committee Introduces Draft Farm Bill with Key Updates for Bioethanol and Biofuels

The Senate Agriculture Committee has presented a draft of the Rural Prosperity and Food Act, a proposed Farm Bill that aims to reshape policies regarding bioethanol, advanced biofuels, and sustainable agriculture.

This draft introduces expanded definitions for critical terms like “lifecycle greenhouse gas emissions,” “ultra-low carbon bioethanol,” and “zero-carbon bioethanol.”

These updates are essential to determine which projects qualify for the USDA’s loan guarantee program.

The proposed bill significantly revises the USDA’s biorefinery loan guarantee program, now accommodating a broader range of projects.

It extends eligibility to initiatives producing ultra-low and zero-carbon bioethanol and other advanced biofuels and biobased products.

This adjustment reflects the increasing demand for renewable energy solutions aligned with long-term climate goals.

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Major Changes to the USDA Loan Guarantee Program

The bill removes the earlier requirement that projects must be “technologically new,” opening opportunities for established technologies to qualify.

This change allows producers to scale up renewable chemical and biobased product manufacturing alongside biofuel production.

These updates aim to modernize and streamline access to critical funding for innovative bioenergy solutions.

Another significant inclusion is sustainable aviation fuel (SAF) as a recognized output. SAF has gained momentum in recent years as a practical solution to decarbonize the aviation sector.

The draft bill also adjusts the scoring process for evaluating applications to prioritize impactful projects better.

The maximum loan guarantee has been increased to €400 million, with provisions for additional grant funding to complement the program.

This enhanced support framework could lead to faster adoption of renewable technologies in the U.S.

Chairwoman Debbie Stabenow emphasized the importance of these updates, saying, “These changes reflect our commitment to building a cleaner, more sustainable energy future while supporting rural prosperity.”

Extensions to Key Bioenergy Programs

Beyond loan guarantees, the draft bill updates multiple existing bioenergy initiatives. These include:

• The Bioenergy Program for Advanced Biofuels: Expanded to support emerging technologies.
  
• The Biodiesel Fuel Education Program: Refocused to increase awareness and adoption.
  
• The Rural Energy for America Program (REAP): Enhanced to promote rural renewable energy development.
  

The continued investment in these programs highlights the Senate’s recognition of bioenergy as a critical pillar for reducing carbon emissions and driving rural economic growth.

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Addressing the Farm Bill Gap

The 2018 Farm Bill expired in September 2023, but a temporary one-year extension was granted to prevent a government shutdown.

However, that extension has now expired, and the legislative gap has raised concerns across the agricultural and energy sectors.

Stakeholders may need to wait until next year to enact a new Farm Bill.

Senator John Boozman commented on the delay: "While the extension gave us temporary relief, the need for a new, forward-thinking Farm Bill is clear. Our rural communities and energy innovators deserve clarity and stability.”

Why This Bill Matters

Including bioethanol, sustainable aviation fuel, and other biobased products in the USDA programs is more than an administrative update—it’s a signal of shifting priorities toward decarbonization.

These changes ensure that advanced bioenergy solutions remain competitive, attract investment, and help the U.S. meet its climate commitments.

This draft bill could encourage innovation and job creation in rural areas by expanding definitions and updating funding structures.

It also paves the way for broader adoption of biofuels across various industries, including transportation and manufacturing.

Looking Ahead

While the Rural Prosperity and Food Act marks an essential step forward, its implementation depends on timely legislative action.

For now, stakeholders can review the complete draft on the Senate Agriculture Committee’s website.

The outcomes of this bill will likely shape the future of rural energy initiatives and the U.S. bioeconomy for years to come.