USDA Loans $16 Million for Power Plant Fueled with Wood Waste

October 19, 2005

The U.S. Department of Agriculture (USDA) announced on October 17th a $16 million loan guarantee to help finance an electrical generating plant in rural Arizona that will burn wildfire-damaged timber along with waste wood and paper fiber from a nearby paper mill. Snowflake White Mountain Power, LLC, will build a 20-megawatt biomass power plant 17 miles from Snowflake, Arizona, near the center of the state's border with New Mexico. The announcement marks the first time that USDA has made a loan guarantee through its Rural Development Renewable Energy and Energy Efficiency program. In July, the USDA announced it would guarantee up to $200 million in loans for such projects. See the USDA press release.

The USDA is also releasing $1.7 billion for voluntary conservation programs on working farms, including $245 million for the Conservation Security Program (CSP), which, among other things, provides funds for on-farm energy management. In late August, USDA announced that 110 watersheds throughout the country and in Guam and Puerto Rico would be eligible for CSP grants in 2006, and that the grants would include a renewable energy component. Eligible farms will receive compensation for converting to renewable fuels such as biodiesel and ethanol and for installing renewable energy systems, including methane production technologies and wind, solar, and geothermal energy systems. See the USDA press releases on the funds and eligible watersheds, and for additional information, see the CSP Web site.