Western Biomass Energy receives BCAP funding

By Erin Voegele | November 11, 2009
Report posted Nov. 19, 2009, at 9:02 a.m. CST

Wyoming-based Western Biomass Energy LLC, a company that is majority owned by KL Energy Corp., has been selected to participate in the USDA's Biomass Crop Assistance Program. The purpose of the program is to support the establishment and production of certain eligible crops that will be converted into bioenergy products, such as ethanol, in selected BCAP project areas. The program provides funding to assist agricultural and forest owners and operators with the collection, harvest, storage and transportation of eligible materials for use in biomass conversion facilities.

Western Biomass Energy will use BCAP funding to help offset the feedstock costs associated with its demonstration-scale cellulosic ethanol plant in Upton, Wyo. The facility, which began operations in 2007, converts wood chips from the Black Hills into cellulosic ethanol.

BCAP currently offers a matching per-ton payment for the collection, harvest, storage and transportation of renewable biomass delivered and sold to local biomass conversion facilities. Beginning in 2010, the program will also provide per-acre payments for the production of dedicated energy crops.

According to KL Energy's program manager John Kelley, the BCAP program will allow Western Biomass Energy to help mitigate feedstock costs in the short term. In the long term, he said the funding will help the company's feedstock suppliers overcome the difficult economics of ramping up feedstock production to supply both the demonstration-scale facility and a future commercial-scale ethanol plant. "KL Energy intends in the year 2010 to be in a position to begin construction of a commercial cellulosic ethanol plant elsewhere in the Black Hills," Kelley said. "The BCAP program will help both entities; the large pilot demonstration plant in Upton, and the emerging plans for a commercial plant in the Black Hills."

The BCAP program was authored by Sen. John Thune, R-S.D., and included in the 2008 Farm Bill. "Renewable fuel production has the capability to make forestry byproducts from the Black Hills a valuable resource," Thune said. "Biofuels and other forms of renewable energy will play an important role in reducing our overdependence on imported energy sources. The implementation of BCAP is a major step toward incorporating more of our nation's resources into our energy strategy."