Ethanol Infrastructure Incentive Program

Purpose
The Ethanol Infrastructure Incentive Program was designed to alleviate retailers across the state from costs associated with the installation of blender pumps.

The State of South Dakota has allocated $3.5 million over the next five years to get the program on its feet. In 2012, $950,000 will be available for ethanol blender pumps installations at retail motor fuel stations.

Guidelines

• The program awards up to $25,000 for the first pump and $10,000 for each additional pump.
• A portion of the annual fund allocation will be awarded on a first-come-first-serve basis. The last $190,000 funds will be awarded competitively.
• Funds can only be used for dispenser, associated hardware, and other tank fueling infrastructure.
• Funds will be provided to grantees on a reimbursement basis with proper supporting documentation. (See below)
• Projects must be completed and reimbursement must be requested within 6 months of grant approval date. A written extension may be granted by the GOED.

Requirements
A completed application that includes a ‘yes’ marked that the site does and will meet all of the South Dakota Department of Environment and Natural Resources rules and regulations. Further information on DENR requirements can be found at: http://denr.sd.gov/des/gw/tanks/PlansAndSpecifications.aspx

Ethanol pumps must be installed at a retail location and:

• Dispense at retail a blend of gasoline and ethanol in the ratio selected by the purchaser;
• Manufactured to an industry standard and carry a warranty for compatibility with dispenser components and storage and piping systems;
• Dispense the following three ethanol blends:
  • A 10 percent blend of ethanol;
  • A blend of 15 percent ethanol or more; and
  • A blend of 25 percent ethanol or more; and
• Comply with all alternative fuel, biofuel, and flexible fuel requirements established by law.
• Hoses dispensing ethanol blends (example: E-30, E-85) that are only legal for flexible fuel vehicles must be separate from hoses dispensing non-flexible fuel blends (E-0 or E-10).

Awardees must continue to sell ethanol blends in excess of 15 percent for a minimum of 24 months of receiving assistance, or repay grant award. GOED may forgive a failure to comply if any of the following conditions are met:

• There are fuel shortages that make compliance impractical;
• Changes in fuel market conditions that make compliance impractical;
• Changes in state or federal regulations that make compliance impractical.

*The amount sought to be repaid may be prorated based upon the number of months less than 24 that ethanol blends were sold.

Additionally, a report or reports of quantities of biofuel blends sold may be required during and after the 24 months of receiving assistance. South Dakota motor fuel retailers must agree to comply with pump removal guidelines, and dispose replaced pumps according to state law.

Partners
Funding for the grant program was made possible by a partnership between South Dakota Ethanol Producers and the State of South Dakota. During the 2011 legislative session, South Dakota Ethanol Producers agreed to a reduction in Ethanol Producer Payments while temporarily allocating a portion of their remaining Ethanol Producer Payments to the blender-pump grant program and a portion to the Revolving Economic Development Initiative fund.

How To Apply
Applications will be accepted starting Jan. 9, 2012. Organizations applying for the grant must submit the application form and supporting documentation to Hunter Roberts via postal mail or e-mail at:

Hunter Roberts
South Dakota Governor’s Office of Economic Development
711 E. Wells Ave.
Pierre, SD 57501
Email: hunter.roberts@state.sd.us

Supporting Documentation
Supporting documentation must include:

• Invoice documenting total cost,
• Personal certification that the installation meets the Department of Environment and Natural Resources specifications,
• Other appropriate documentation
• Pump specifications detailing the number of hoses and blends.