Cellulosic producers react to DOE funding boost

By Kris Bevill | November 11, 2009
Report posted Dec. 8, 2009, at 3:46 p.m. CST

The Dec. 4 joint U.S. DOE/USDA advanced biorefinery grant announcement was a delight to the 19 companies receiving the funding and many company leaders said it validates their technologies and provides the boost they will need to get their projects off the ground.

ZeaChem Inc., which recently announced the groundbreaking of its semi-commercial scale cellulosic ethanol production facility in Oregon, was selected to receive $25 million to further the project. "This award accelerates deployment of ZeaChem's integrated biorefinery and our progress to commercial production of advanced biofuels and biobased chemicals," ZeaChem President and CEO Jim Imbler said. "We look forward to working with DOE to finalize the award agreement." ZeaChem will be expected to contribute $48 million as its cost share for the grant.

BlueFire Ethanol Fuels Inc. will receive $81 million for Phase II of its Fulton, Miss., project. The latest award brings the DOE's total investment in the Fulton project to approximately $88 million, according to the company. "We're excited the DOE has faith in BlueFire," company president and CEO Arnold Klann said. "We knew we were going to be getting a grant, but we didn't know the timing of it." Klann said BlueFire was expecting to receive the additional funding in January or February and the early announcement will allow the company to move forward with its efforts to cover the debt for the project. The grant requires BlueFire to raise approximately $223 million in debt and/or equity for the project.

Montreal-based Enerkem Corp.'s U.S. subsidiary was one of the larger demonstration projects to receive funding. The company was awarded $50 million to further its waste-to-biofuels facility in Pontotoc, Miss. The facility is projected to initially produce 10 MMgy of cellulosic ethanol. A second module will be added when the plant is fully operational and will double the plant's capacity. "Enerkem's Mississippi waste-to-biofuels project is a model of high energy, economic and environmental performance, which we intend to reproduce throughout the United States," said president and CEO Vincent Chornet. Enerkem's cost share for the grant is approximately $90 million.

ICM Inc. was selected to receive $25 million for its project to modify LifeLineFoods' 1 MMgy St. Joseph, Mo., facility to produce ethanol from switchgrass and sorghum. According to ICM, the co-location of the cellulosic demonstration facility with LifeLine's corn-based facility will demonstrate the capability of corn ethanol production facilities to increase total renewable fuels capacity by also producing ethanol from nonfood cellulosic materials. "We're very excited to have been selected among a highly competitive and accomplished field of applicants for this funding award and I'm so proud of our employees for their dedication in putting together such a solid proposal," president and CEO Dave Vander Griend said. The grant calls for ICM to contribute approximately $6 million as its cost-share for the grant.

EdeniQ Inc. and Logos Technologies Inc. were awarded $20.4 million to modify and operate EdeniQ's refinery site in Visalia, Calif., as a cellulosic ethanol facility, using corn stover and switchgrass as feedstocks. Logos will manage the project and EdeniQ will provide the technology. The companies' cost share for the project is approximately $5 million.

Algenol Biofuels Inc. will receive $25 million to be used for its project to produce ethanol derived from carbon dioxide and seawater using algae. According to the company, it possesses the most advanced third-generation biofuel technology in the United States and can produce more than 6,000 gallons of ethanol per acre per year. "This successful demonstration of Algenol's technology will open the door to commercial-scale deployment of this low-cost green fuel," CEO Paul Woods said. "Receiving support from the DOE to create a renewable, low-cost, domestic, green fuel product is an affirmation of the important research and development initiatives of the past few years." Algenol's cost share for the grant is approximately $34 million.

All of the ethanol projects selected to receive funding are also planning to produce biobased chemicals and/or drop-in replacement fuels, which hints that the DOE is shifting its focus away from cellulosic ethanol and toward other advanced biofuels. However, when asked by EPM if it is changing its area of focus, the DOE simply stated that it supports all biofuels that meet the renewable fuels standard. "The RFS requirement is for 21 billion gallons per year of advanced biofuels, of which 16 billion gallons per year must be from cellulosic biofuels," the agency stated.