Bioenergy Funding Strategy Brief: Clean Technology, Capital and Policy-Joshua D. Mosshart

Bioenergy Funding Strategy Brief: Clean Technology, Capital and Policy: There is clearly a clean technology revolution at hand. We need new financial vehicles that can deploy the capital required for rapid g...

Clean Technology, Capital and Policy- Joshua D. Mosshart

There is clearly a clean technology revolution at hand.

We need new financial vehicles that can deploy the capital required for rapid growth in clean technology industries. Clean technology initiatives is one catalyst to ignite the funding fire. Growth initiatives is what gives countries their competitive edge.

China is currently leading the world in clean technology's because China's central government has become very serious about supporting this effort with massive initiatives and subsidies to gain a first to market competitive edge. China is significantly ramping up its investment targets in clean technology.

The Chinese government is projected to invest over $ 700 billion in clean energy technology in the next decade. This coupled with technology innovation, low labor costs and high demand will drive the clean technology revolution in China.

To be a leader in the United States in clean technologies and have the benefits of a clean energy future, job creation, energy independence, manage climate change, pollution mitigation and economic competitiveness there has to be U.S. Federal involvement in investment and finance.

We need a collabrative funding model to include the cities, states and the federal agencies in the clean technology development and commercialization.

Understanding the impacts from a macroeconomic and microeconomic view point with transperancey at every level is the key to success.

We have to have a creative finacing model that is employed at the federal level for clean-technology providing a framework for deployment of these technologies.

 It would require a long-term, predictable, federal regulatory and policy framework and support.

We need to enforce a strong federal renewable energy standard. 

We have to have a major shift for energy subsidies away from fossil fuels to domestic clean energy technologies.


Joshua D. Mosshart
Cleantech Grants

Bioenergy Funding Brief-Joshua D. Mosshart

Unfortunately most financial institutions fear anything that isn't financially stabilized and unproven.

Many bioenergy companies have had big challenges raising cash with equity in the early stages of development.

Especially if the management lacks the track record proving the viability and the marketing strategy lacks a clear execution to gain sustainable long term market share.

There are many options to get capitalized in addition to selling owner equity like;

1. Grants, Job training and cash awards that are non-dilutive to equity, non-recourse
2. Tax Credits, in some cases you can sell the credits for upfront cash and used them to attract debt.
3. Local Incentive, especial in rural high national un-employment (Red Zone) areas.
4. Bonds, revenue ruling 63-20, General Obligation/Revenue Bonds
5. Appropriated Dollars, congressional initiatives to support mandates.
6. Loans, traditional
7. U.S. Federal Loan Guarantees, Energy Policy Act of 2005 (EPACT)
8. Tax Abatements
9. Tax Increment Financing (TIF), for infrastructure financing
10. Angels, usually more patient than venture capital.


These funding options can be challenging if you don't have a professional whom is familiar with the appropriate public entities, funding sources, and government officials.

Department of Energy's Loan Programs

1. Section 1703: loan guarantees for innovative clean energy technologies with high degrees of technology risk.

2. Section 1705: loan guarantees for certain renewable energy systems, electric power transmission, and innovative biofuel projects that may have varying degrees (high or low) of technology risk.

3. Advanced Technology Vehicle Manufacturing (ATVM): direct loans to support advanced technology vehicles and associated components.

Some of the best sources of getting capital for your start-up bioenergy project could be from the individuals that could benefit the most. Like the farmers, producers or distributers who supply the biomass.

They could come in with cash or supply the commodities, landowners can receive equity and potentially a significant return on investment if you make it to commercial scale. Don't disount the fact that raw material can be counted as an asset that could be used to facilitate debt.

Department of Agriculture

Business & Industry (B&I) Guarantee Loan Program: provides up to 90% loan guarantee, maximum loan amount $40m, amoritizations as high as thirty years.

Rural Utilities Service (RUS): $200m in dirrect loans available through USDA for bioenergy fixed rates amortized over twenty five years.

Renewable Energy Grant and Loan Program: $176M in guarantee loans available for projects that produce energy from renewables and up to $11M in grants. Only need to demonstrate financial need to qualify.

Value-Added Agricultural Product Market Development Grants: up to $500K in grants for buisness plans and viable marketing opportunities. Grants are available for planning and working capital.

Biomass Reasearch and Development Initiative: Development and demonstration of biomass, bioenergy and biofuels. Up to $15m available each year.

Food Conservation, and Energy Act of 2008: provides grants for renewable technologies, it allots $1B for programs designed to encourage investment in renewable energy and technology. The Act also created Rural Energy for American Program (REAP), the bioenergy program recieves $300m in funding to provide incentives for using agricultural and forestry crops and waste to produce bioenergy.

"This is just the tip of the iceberg"

There is currently over $142.8B in 2014 in the President's Budget for Federal R & D.

“When we invest in the best ideas before anybody else does, our businesses and our

workers can make the best products and deliver the best services before anybody else.

And because of that incredible dynamism, we don’t just attract the best scientists or the

best entrepreneurs -- we also continually invest in their success.”

- President Barack Obama

  April 2013

President Barack Obama 2014 Budget Snapshot

 $526.6 billion in discretionary funding for the Department of Defense.

 $76.6 billion in discretionary and mandatory resourcres for the Department of Transportation.

 $28.4 billion in discretionary funds for the Department of Energy.

 $22.6 billion in discretionary funding for the Department of Agriculture.

 $8.2 billion for the Environmental Protection Agency.

 $11.7 billion in discretionary funding for the Department of the Interior.

 $7.6 billion for the National Science Foundation.

 $80.1 billion in discretionary funding for the Department of Health.

 $8.6 billion for the Department of Commerce.

 $39 billion in discretionary funding for the Department of Homeland Security.

 $44.8 billion  discretionary funding for the U.S. Dept. of Housing and Urban Development.

Cleantech Grants