May 23, 2012
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Reporter: Morgan Demmel Email

USDA Offers Incentives For Renewable Energy Program

As lawmakers continue to work toward reducing US dependence on foreign oil, the Department of Agriculture is reaching out to ethanol companies, including many in Nebraska.

Producers call it the "second generation" of ethanol.

It's the production of advanced biofuels using sources other than corn starch.

"Corn starch is the most popular one right now," USDA Area Specialist Kelley Messenger says.

Messenger adds only some of that corn can go toward ethanol production before the amount used for food is impacted.

Experts say switching to another source helps alleviate that problem.

"Switching over to soybeans or sorghum would put less pressure on the corn growers and leave more food for corn supply versus strictly fuel," Messenger says.

The USDA is taking steps to make sure that happens, by offering incentives to companies producing biofuels without corn starch.

Producers like Kaapa Ethanol in Minden are helping Nebraska lead the country in producing renewable energy, especially in the second generation.

"Nebraska is the second largest ethanol producing state in the nation, so it's a significant player in the biofuels area," Kaapa Ethanol CEO Chuck Woodside says.

He says the industry will continue to grow.

The USDA incentive program is based on the amount of production, with a total of $25 million available to participating producers nationwide.

Kaapa is just one of a number of Nebraska producers participating in the program, and USDA officials say they hope that number will continue to grow.


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