DOE offers Poet a $105 Million Loan Guarantee for cellulosic ethanol
By Sara Wyant
© Copyright Agri-Pulse Communications, Inc
WASHINGTON, July 7 - U.S. Energy Secretary Steven Chu today announced the offer of a $105 million loan guarantee to support the development of the nation's first commercial-scale cellulosic ethanol plant. Project LIBERTY, sponsored by POET, LLC, plans to produce up to 25 million gallons of ethanol per year in a plant located in Emmetsburg, Iowa.
POET estimates the project will generate approximately 200 jobs during construction and 40 permanent jobs at the plant. POET estimates the project will also bring approximately $14 million in new revenue to area farmers through the purchase of corn cobs, corn cobs, leaves, husks and some stalks. In anticipation of this agreement, POET began construction at the site last year with a 22-acre integrated stackyard to store the biomass delivered by area farmers. The loan guarantee, if finalized, will allow construction to remain on schedule for completion in 2013.
“This project will help decrease our dependence on oil, create jobs and aid our transition to clean, renewable energy that is produced here at home,” said Secretary Chu. “The innovations used in this project are another example of how we are seizing the opportunity to create new economic opportunities to win the clean energy future.”
This is the first loan guarantee for the Energy Department, but USDA Rural Development announced its first $80 million similar loan guarantee for Range Fuels in 2009, to make cellulosic biofuel from wood chips and another $405 million in loan guarantees in January 2011.
“Projects like the one we are announcing today show that our investments in next generation biofuels are paying off,” said Secretary Tom Vilsack. “This project is an important step in the Obama Administration's effort to break our nation's unsustainable dependence on foreign oil and move toward a clean energy economy.”
POET CEO Jeff Broin said he's excited POET is about to achieve its goal of bringing new renewable fuel technology to commercial scale.
“Financing has been one of the biggest challenges to scaling up cellulosic ethanol, and the offer for a conditional commitment for a loan guarantee from DOE's Loan Programs Office brings us one step closer to commercial production,” Broin said. “Cellulosic ethanol holds tremendous promise for America,” Broin continued. “There is more than one billion tons of biomass available each year that could be used to make enough cellulosic ethanol to completely displace oil imports. Today's announcement brings us closer to making that promise into a reality.”
The project uses enzymatic hydrolysis to convert waste into ethanol and will produce enough biogas to power both Project LIBERTY and POET's adjacent grain-based ethanol plant. Project LIBERTY will displace over 13.5 million gallons of gasoline annually and fulfill more than 25 percent of the projected 2013 Renewable Fuel Standard Requirement for biomass-based cellulosic ethanol. POET plans to replicate their unique process at 27 of their other corn ethanol facilities, which would have a projected combined annual capacity of one billion gallons per year of cellulosic ethanol. The company estimates that 85 percent of Project LIBERTY will be sourced with U.S. content.
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