42 USC § 16503 - Sugar ethanol loan guarantee program

---
identifier: "/us/usc/t42/s16503"
source: "usc"
legal_status: "official_prima_facie"
title: "42 USC § 16503 - Sugar ethanol loan guarantee program"
title_number: 42
title_name: "THE PUBLIC HEALTH AND WELFARE"
section_number: "16503"
section_name: "Sugar ethanol loan guarantee program"
chapter_number: 149
chapter_name: "NATIONAL ENERGY POLICY AND PROGRAMS"
subchapter_number: "XIV"
subchapter_name: "ETHANOL AND MOTOR FUELS"
positive_law: false
currency: "119-84"
last_updated: "2026-04-17"
format_version: "1.1.0"
generator: "[email protected]"
source_credit: "(Pub. L. 109–58, title XV, § 1516, Aug. 8, 2005, 119 Stat. 1091.)"
---


# § 16503. Sugar ethanol loan guarantee program

**1** **In general** section 661a of title 2[^1]

Funds may be provided for the cost (as defined in ) of loan guarantees issued under title XIV  to carry out commercial demonstration projects for ethanol derived from sugarcane, bagasse, and other sugarcane byproducts.

See References in Text note below.

**(b)** **Demonstration projects** The Secretary may issue loan guarantees under this section to projects to demonstrate commercially the feasibility and viability of producing ethanol using sugarcane, sugarcane bagasse, and other sugarcane byproducts as a feedstock.

**(c)** **Requirements** An applicant for a loan guarantee under this section may provide assurances, satisfactory to the Secretary, that—

**(1)** the project design has been validated through the operation of a continuous process facility;

**(2)** the project has been subject to a full technical review;

**(3)** the project, with the loan guarantee, is economically viable; and

**(4)** there is a reasonable assurance of repayment of the guaranteed loan.

**(d)** **Limitations**

**(1)** **Maximum guarantee** Except as provided in paragraph (2), a loan guarantee under this section—

**(A)** may be issued for up to 80 percent of the estimated cost of a project; but

**(B)** shall not exceed $50,000,000 for any 1 project.

**(2)** **Additional guarantees**

**(A)** **In general** The Secretary may issue additional loan guarantees for a project to cover—

**(i)** up to 80 percent of the excess of actual project costs; but

**(ii)** not to exceed 15 percent of the amount of the original loan guarantee.

**(B)** **Principal and interest** Subject to subparagraph (A), the Secretary shall guarantee 100 percent of the principal and interest of a loan guarantee made under subparagraph (A).

---

**Source Credit**: (Pub. L. 109–58, title XV, § 1516, Aug. 8, 2005, 119 Stat. 1091.)

## Editorial Notes

### References in Text

Title XIV, referred to in subsec. (a), is title XIV of , , , which enacted subchapter XIII of this chapter and .