Credit aid and federal loan guarantees were a couple suggestions by the Renewable Fuels Association to President-elect Barack Obama's transition team for an economic stimulus package designed to create green jobs and spur the green economy. The suggestions were made in response to a request by the incoming administration.
RFA disagreed with media reports it said characterized its suggestions as a request for a federal bailout for the ethanol industry.
"Some have misconstrued this communication as a request for federal assistance or a bailout,” the RFA said in a statement. “The RFA recognizes that by stimulating increased production, innovation, and investment in new technologies and cellulosic feedstocks, a revitalized renewable fuels industry can help bail out the flagging US economy and lessen America's dependence on foreign oil,"
According to the Wall Street Journal, RFA's suggestions included:
- Setting up a $1 billion short-term credit facility to enable ethanol producers to finance current operations
- A $50 billion federal loan guarantee program to finance investment in new renewable fuel production capacity and supporting infrastructure
- A requirement that any auto maker receiving federal aid only produce new vehicles that can run on any blend up to 85% ethanol, beginning with the 2010 model season.
"America's ethanol producers share the vision of President-elect Obama of a domestic industry that is innovating to include ethanol production from a wide array of materials including switchgrass, wood chips, and municipal solid waste,” said the RFA.