USDA Backs New Biomass Refineries

Tom Vilsack heads the U.S. Department of Agriculture (USDA), but in the brave new world of alternative fuels, he sometimes edges into Steven Chu’s turf at the Department of Energy. Case in point: the USDA’s Biorefinery Assistance Program, which provides loan guarantees to companies looking to make advanced biofuels. Vilsack and the department just listed a set of projects it will back, headed by a western Alabama cellulosic ethanol biorefinery that will receive a $250 million loan guarantee to help with construction and operation costs.

The Coskata plant in Alabama – which has General  Motors as a backer – is supposed to crank out 55 million gallons of fuel-grade ethanol annually. The company said its proprietary combination of microorganisms and super-efficient bioreactor designs can produce around 100 gallons of fuel from each dry ton of, well, just about any biomass: wood and wood waste, agricultural waste, energy crops and municipal solid waste.

Alabama biorefinery, Coskata Inc.

image via Coskata

The USDA also backed two other big biorefinery projects in the south: In Pontotoc, Miss., Enerkem will get an $80 million loan guarantee for a plant that will gobble up 100,000 metric tons of municipal solid waste, dried and post-sorted through a thermo-chemical cellulosic process, to make 10 million gallons of ethanol per year; and in Vero Beach, Fla., INEOS New Planet BioEnergy is getting a $75 million loan guarantee to construct and operate a biorefinery that will produce 8 million gallons per year of cellulosic ethanol plus have an electricity-producing capacity of 6 megawatts. This same project received a $50 million government grant in late 2009.

The Biorefinery Assistance Program (Section 9003 of the 2008 Farm Bill), said the USDA, provides loan guarantees to entrepreneurs eager to take advantage of the growing opportunities in renewable energy provided by advanced biofuels. Also, through its Rural Development mission area, the government agency administers and manages more than 40 housing, business and community infrastructure and facility programs through a national network of 6,100 employees located in the nation’s capital and nearly 500 state and local offices. These programs are said to improve “the economic stability of rural communities, businesses, residents, farmers and ranchers and improve the quality of life in rural America.” Rural Development has an existing portfolio of nearly $142 billion in loans and loan guarantees.

Pete Danko is a writer and editor based in Portland, Oregon. His work has appeared in Breaking Energy, National Geographic's Energy Blog, The New York Times, San Francisco Chronicle and elsewhere.