DOE Will Back POET’s New Plant Financing
EMMETSBURG The financial shot in the arm needed to keep POET LLC’s Project LIBERTY plans on track was received Thursday, July 7, when the Department of Energy announced it would guarantee a $105 million loan for a new cellulosic ethanol plant.
Construction of the plant is expected later this year, said Nathan Schock, POET’s director of communications. He said the loan guarantee will keep the project on track for the plant being operational in 2013.
The loan guarantee is from the DOE’s Sect. 1705 of Title XVII, one of three loan guarantee programs it oversees. 1705 is designed to promote the rapid deployment of renewable energy systems, and was created by the American Recovery and Reinvestment Act.
“One of the biggest hurdles in this economy,” said Schock, “is (securing) financing for a first-of-its-kind project.” The DOE’s announcement “will allow us to keep things moving,” Schock said. “But we still have to come up with the funds.”
He said after POET closes the agreement with DOE, it will secure its funds through the Federal Financing Bank, which was created by Congress in 1973 as a government corporation to reduce the cost of federal borrowing.
The cellulosic ethanol plant will produce up to 25 million gallons of ethanol per year and will be located in Emmetsburg. POET estimates the project will generate approximately 200 jobs during construction and 40 permanent jobs at the plant.
“It may only be 40 jobs,” said John Schad, Emmetsburg’s mayor, “but they will be very good jobs filled by very smart people.
“This will also put Emmetsburg in the forefront of cellulosic ethanol in the nation. We’ll have people here who will know more about it than anywhere in the world and sets us up in a nice position as this fuel develops.”
It also estimates the project will bring approximately $14 million in new revenue to area farmers. The feed stock for the plant will be corn stover stalks, cobs and leaves rather than corn grain.
In December 2010, POET started taking stover bales from contracted corn growers in order to gain experience in receiving and storing the two-ton bales. Schock said the plant learned much about handling stover following the first harvest.
“The suppliers were great,” Schock said, “and we are feeling more confident about the biomass harvesting part of the process.”
“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 U.S. Energy Secretary Steven Chu in a telephone conference call. “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.”
Projects like this one, said Tom Vilsack, U.S. Secretary of Agriculture during the same call, “show that our investments in next generation biofuels are paying off. 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’s cellulosic ethanol process will use enzymatic hydrolysis to convert waste into ethanol, producing enough biogas to power both Project LIBERTY and POET’s adjacent grain-based ethanol plant.
POET said the additional plant will displace more than 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 its unique process at 27 of its 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.