Alternatives Fuels Production Incentive

Summary

Mississippi offers a production incentive to in-state producers of ethanol, anhydrous alcohol, biodiesel and wet alcohol. Producers will receive $0.20 per gallon for each gallon of ethanol or anhydrous alcohol produced on or before June 30, 2005, or for 10 years after the start of production, whichever is later. Producers of wet alcohol will receive a payment calculated by the formula "alcohol purity in percent divided by five," and rounded to the nearest cent per gallon, with a minimum of $0.11 per gallon. This incentive applies to a maximum of 30,000,000 gallons of fuel per producer per year. A company holding a controlling interest in more than one ethanol plant is considered a single producer. No payments will be made for production occurring after June 30, 2015. A producer may receive a maximum incentive of $6 million per fiscal year. Total funding is limited to $37 million per fiscal year. In addition, producers of ethanol or wet alcohol will receive a payment of $0.015 (1.5 cents) per kilowatt-hour for each kilowatt-hour of electricity generated using biomass in a cogeneration facility at an ethanol plant in Mississippi. Facilities must begin operation by June 30, 2005, to be eligible. This payment expires 10 years after a facility begins operation.