Up and Running

Retailers respond positively to SD blender pump incentive
By Kris Bevill | February 22, 2012

The application window for South Dakota’s inaugural blender pump grant program may have just opened on Jan. 9, but it already appears that the incentive will be a success. More than half the fiscal year’s available funds had been applied for within a couple of weeks of the Ethanol Infrastructure Incentive Program’s launch, according to South Dakota’s Energy Policy Director Hunter Roberts, leaving little doubt that the entire $950,000 budget would be quickly distributed to future blender pump retail locations.

“I’m extremely pleased with the activity we’ve already seen,” Roberts said in late January. “We only started accepting applications this month and we have received $515,000 in applications for 15 different stations to install 29 blender pumps. Clearly, we’re seeing a lot of positive interest.”
South Dakota’s blender pump program is a five-year, $3.5 million grant program and was initiated by the state’s ethanol producers, who volunteered to redirect a portion of the state’s Ethanol Producer Payments Program to fund the initiative. Dana Siefkes-Lewis, president of the South Dakota Ethanol Producers Association, says the goal is to increase the availability of ethanol blends, thereby benefiting the state’s economy and the ethanol industry. A total of 15 ethanol plants are located in

South Dakota, representing more than 1 billion gallons of annual production capacity, including top U.S. producer, Poet, which has five plants and a research facility in the state.

In early January, representatives from the American Coalition for Ethanol and Growth Energy joined with officials from the state’s economic development office to conduct a series of informational meetings for retailers. Rick Serie, director of market development at ACE, and Roberts said feedback from retailers was very positive. Most retailers interested in installing blender pumps say they would do so to gain an edge over their competitors, Serie says. According to ACE, there are currently about 45 blender pump locations in the state and the Governor’s Office of Economic Development estimates blender pumps at around 100.

Serie says the GOED should be commended for creating a user-friendly blender pump incentive program. The application form is a mere two pages and is very easy to complete, he says, compared with the USDA’s Renewable Energy for America Program application, which stretches to more than 100 pages. “That’s the key: keep it simple,” he says. “We think this is going to be a good model for other states to follow.”

The majority of the S.D. program’s funds will be awarded on a first-come, first-serve basis. The GOED says it will consider the program a success whether it results in many new pump locations or a few locations with many new pumps. Applicants are eligible to receive grants for up to $25,000 for the installation of a station’s first blender pump, and up to $10,000 for each additional pump. —Kris Bevill