April 26, 2011 | Vol. 61, No. 9
|Dear PEI Member:
Beginning April 14, the U.S. Department of Agriculture's (USDA) Rural Energy for America Program (REAP) is available to provide grants and loan guarantees for the purchase and installation of retail flexible fuel dispensers and related equipment, and the retrofitting of existing pumps to dispense E85.
The program is geared to serve the rural small business owner. The station must be in an area with a population under 50,000 and not in an urbanized area adjacent to a city or town with a population over 50,000 (i.e., a suburb of a major city). Furthermore, owners of convenience stores with gasoline stations must have average annual sales of less than $27 million to qualify.
Grant awards are limited to no more than 25 percent of total eligible project costs, with a minimum grant of $2,500 and a maximum grant of $500,000. Loan guarantees must not exceed 75 percent of the total eligible project costs (including REAP grant funds, if applicable), with a minimum of $5,000 and a maximum of $25 million. The costs to purchase and install/upgrade/retrofit a dispenser and tank only to dispense E15―after the fuel is approved by EPA―are NOT covered by this program. Project costs that may be paid with REAP funds include, but are not limited to:
Station owners may have access to additional sources of funds, including a 30 percent U.S. Department of Treasury tax credit for the investment in renewable refueling infrastructure, as well as financial incentives from industry and selective states for flexible fuel pumps.
Applicants for USDA grants and loan guarantees must submit a completed application by June 15, 2011, to be eligible for funding during the government's fiscal year 2011 which ends September 30. USDA will score each application using several criteria. Each scored application will compete against all other REAP applications, with higher scoring applications receiving first preference. USDA officials announced during a recent webinar that usually around 75 percent of REAP grant applicants are approved. USDA intends to announce awards each year between July and September.
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For more information on REAP and flexible fuel pump program, PEI members should direct their customers to the USDA Rural Development Energy Coordinator (PDF) in the state where the station is located.
KIPLINGER: ALTERNATIVE FUELS MAKING
Look for cellulosic ethanol to break out first, with the first commercial plant in the U.S. slated to open next year. The operator, Poet of S.D., expects fuel brewed from corn stalks to cost about a dollar less per gallon than pure gasoline. Newly developed enzymes that work with any plant matter will let distillers shop for the cheapest feedstocks.
Algae-based fuels will take longer to perfect, but offer significant potential as a long-run petroleum replacement. Expect algae to compete with oil on price by 2020, as technology gains whittle away the current two-to-one advantage now held by crude-oil-based fuel.―The Kiplinger Letter, April 15, 2011.
SNAPSHOT OF CANADIAN RETAIL GASOLINE OUTLETS
LUNDBERG: FUEL ETHANOL EMPIRE ON THIN ICE
"Prior to investing in blender pumps, retailers should consider: The rock solid support for ethanol from politicians is crumbling for several reasons including the nation's huge budget deficit. Environmentalists have for the most part abandoned support for ethanol as a 'clean fuel.' And most importantly, motorists' patience may be reaching a tipping point―especially if force feeding of E15 commences.
"Bleeding tax coffers at a time of record deficits, ethanol also robs economically strained motorists of mileage, while the latest EPA approval of 15 percent ethanol in gasoline may damage car engines and invite lawsuits. Meanwhile, corn consumers are livid as the price of corn has doubled along with ethanol's share of the crop."―Lundberg Letter, February 16, 2011.
PEI DISTRIBUTOR MEMBER NEWS
STI/SPFA ELECTS NEW DIRECTORS AND OFFICERS
PEI members who were recently elected to serve three-year terms on the STI/SPFA board include Tony Honey of Modern Welding Co., Inc., Steve Meeker of Hamilton Tanks, LLC, and Sonny Underwood. David Watson of Watco Tank, Inc. continues on the STI/SPFA board.
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The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Robert N. Renkes, Executive Vice President, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.