August 29, 2006

Second round of grants to help defray costs

LANSING – Governor Jennifer M. Granholm today announced that the state of Michigan will work to have 1,000 biofuel pumps by 2008 to make ethanol and biodiesel fuel more accessible to Michigan motorists.  To reach that goal, the governor announced a $250,000 grant program to help service station owners defray the costs of installing or converting infrastructure at public service stations to provide ethanol and biodiesel fuel to Michigan consumers.  This is the second round in a series of grants being made available by the state.
 
“Michigan is moving aggressively to increase production and use of both ethanol and biodiesel fuels,” Granholm said.  “Ethanol and biodiesel production facilities are coming on line.  We’ve cut taxes on the purchase of these fuels, and now, thanks to this grant program, we will greatly expand access.  Expanding access and use will help reduce the cost of gas for all of us.”
 
Five ethanol plants are already in production in Michigan, with two more under construction.  Two biodiesel plants are also beginning production, with another plant in the works.  In addition, the legislative package signed by the governor in July cut the gas tax by 36 percent for the purchase of ethanol and 20 percent for biodiesel.
 
Granholm said that Michigan’s investment in alternative energy production and use will benefit consumers in the long-run as increased use of ethanol and biodiesel helps reduce the demand for foreign oil.  In the short-term, Granholm said the state is doing everything in its power to protect consumers at the pump, including doubling the number of inspections this year to ensure that consumers are receiving the quantity and quality of gasoline they are paying for.  The governor said that President Bush could provide short-term relief, as well, by capping outrageous oil company profits.
 
“It’s time for President Bush to stand up for Michigan citizens and cap big oil’s outrageous profits,” said Granholm.  “That will provide our citizens immediate relief from high gas prices, while our long-term solutions take route and end our dependence on foreign oil once and for all.”

Legislation signed by the governor in July called for the creation of this program to increase the number of retail outlets throughout the state that provide ethanol and biodiesel to fleet owners and the public. 

To implement the grant program, the state is seeking proposals from 501(c) (3) nonprofit corporations for state projects to provide incentives to service station owners to convert existing pumps or install new ethanol and biodiesel pumps.  Ethanol and biodiesel are clean burning fuels that can be made from renewable resources grown in Michigan.  Most ethanol is made from corn, and biodiesel is made from vegetable oils and waste grease.  Over the last two years, rising oil prices and an increased number of biofuel production facilities in the U.S. have helped reduce the price difference between petroleum fuels and bio-based alternatives.
 
Today’s announcement is the second phase of the grant program.  In July, NextEnergy received a $62,500 grant to provide the first round of grants to service stations.  The initial grants are expected to be awarded in September.
 
“This program will greatly expand the availability of ethanol and biodiesel to consumers throughout Michigan,” said Bob Swanson, director of the Department of Labor and Economic Growth, which will oversee the program.  “Michigan farmers will benefit through increased demand for corn and soybeans, Michigan citizens will enjoy cheaper gas prices and a cleaner environment, and Michigan’s economy will be strengthened through increased investment in infrastructure and a decreased reliance on foreign oil.
 
Funding for the Biofuel Infrastructure Incentive Program was made available through a grant from the U.S. Department of Energy (www.energy.gov).  The program will be administered by the Department of Labor and Economic Growth (DLEG) Energy Office, (www.michigan.gov/energyoffice) in cooperation with the Michigan Strategic Fund.

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