Fuels

E15 Offers a Competitive Advantage—Here’s How USDA Funding Can Help

What retailers need to know regarding the USDA Higher Blends Infrastructure Incentive Program (HBIIP)
Photograph: Shutterstock

In the competitive fuel sales business, retailers need every advantage they can to maximize fuel sales, increase margins, and drive consumer traffic into the store.

E15 (Unleaded 88) can boost the bottom line with a cheaper price on the sign and a lower fuel cost. It is a higher-ethanol blend and a more environmentally friendly fuel. Leading retail chains report that E15 generates up to 30 to 50 percent of total fuel sales without negatively impacting demand for other fuel grades. The USDA recently released $100 million dollars available to retailers and suppliers who want to add higher blends of biofuels such as bioethanol to their fuel offerings. With the new funding opportunity, there is no better time for retailers to add E15 to their product lineup.

Growth Energy is offering their unrivaled expertise to help retailers secure funding for E15 projects. Growth Energy’s experts include former fuel retail executives from leading retailers including Sheetz and Casey’s with a track record of obtaining more than $220 million in public and private resources for higher-ethanol blend infrastructure. Growth Energy is a one-stop shop for retailers, previously helping retailers obtain funding from USDA programs and leveraging private investment to secure more than $75 million from the USDA BIP and more than $53 million in funding from the USDA HBIIP.

To learn more about how Growth Energy can walk retailers through the entire HBIIP application process, including technical report requirements and cost estimate analysis, and provide answers to frequently asked questions, reach out to Growth Energy Market Development.

About the HBIIP

As of Aug. 23, 2022, the U.S. Department of Agriculture (USDA) is accepting applications for $100 million in grants through the Higher Blends Infrastructure Incentive Program (HBIIP) to expand access for American biofuels for drivers around the country. This includes E15, which has seen steady growth in sales and distribution in recent years; American motorists have driven more than 32 billion miles on it in just the last seven years, according to retailer data and consumption reports.

Here is what convenience-store retailers need to know about the grant program and application process, according to a Rural Development spokesperson.

What is the HBIIP in a nutshell? How can it benefit retailers?

HBIIP is designed in service of the USDA’s goals to leverage rural American agriculture to reduce reliance on fossil fuels and make cleaner, more affordable fuel options available at the pump.

Through HBIIP, the federal government will share the cost of building, replacing, and retrofitting biofuel-related infrastructure such as pumps, dispensers and storage tanks, aiming to expand the market for higher-ethanol blends of fuel and make them more widely available. For retailers and distributors, this lowers the out-of-pocket cost of installing and upgrading infrastructure and related equipment on their sites.

What were outcomes of the 2020 HBIIP program, and how can they inform expectations for this year?

This year’s initiative follows the USDA’s initial HBIIP investments made in 2020, which totaled approximately 200 awards covering equipment replacements and adjustments at almost 1,000 locations. This year’s program will be more extensive, now including new applicant and project types, increasing the federal match on underground storage tanks to 50%, increasing the maximum cost reimbursable for fuel dispensers and storage tanks, extending the time period to 36 months for a project to be completed and reimbursed and streamlining the environmental review process for applicants with multiple sites.

Who is eligible for HBIIP funding?

Owners of transportation fueling, and fuel distribution facilities located within the United States and its territories are eligible for the program. Eligible entities include fueling stations, convenience stores, hypermarket retailer fueling stations, fleet facilities (including automotive, freight, rail and marine) and similar entities with equivalent capital investments. Fuel/biodiesel terminal operations, midstream operations and heating oil distribution facilities or equivalent entities are also eligible.

What does the application process look like? Are there advantages to applying quickly?

First, the applicant needs to be registered in the System for Award Management (SAM.gov). Second, anyone who is planning to work in the application system needs a Level 2 eAuthentication customer account. The online application system will remain open through November 21, 2022. All applications will be processed concurrently after the application window closes.

The “How to Apply” section of the HBIIP webpage contains additional details on the application process, including guides and checklists.

What resources are available for retailers and distributors navigating the application process?

USDA Rural Development staff are available to answer questions, provide guidance and be a resource for potential applicants throughout the process.

The USDA has an extensive webinar schedule planned to help applicants through the different phases of applying. Details can be found at https://www.rd.usda.gov/hbiip. Each webinar will be recorded and posted to the website for on-demand viewing.

To learn more about the HBIIP—and how Growth Energy can help retailers and distributors apply—contact the Growth Energy Market Development team: MarketDevelopment@GrowthEnergy.org

This post is sponsored by Growth Energy

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