The U.S. Department of Energy (DOE) underscored its commitment to biofuels by signing off on a conditional commitment for a loan guarantee to fund a huge new cellulosic ethanol plant in Kansas. The $133.9 million loan guarantee will go to Abengoa Bioenergy Biomass of Kansas, a U.S. subsidy of the Spanish-based Abengoa Bioenergy, one of the world’s largest producers of ethanol.

Once completed, the plant hopes to convert approximately 300,000 tons of corn stover (stalks and leaves and other material that doesn’t become food) into approximately 23 million gallons of ethanol per year using an innovative enzymatic hydrolysis process.

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According to the DOE, the project is expected to displace over 15.5 million gallons of gasoline annually. That amount of gasoline would produce around 139,000 tons of carbon dioxide emissions.

In addition, the DOE said that the project will create 300 construction jobs and 65 permanent jobs. “This project is part of the Administration’s commitment to expand our advanced domestic biofuels industry,” said DOE Secretary Steven Chu. “Investments like these will create jobs and decrease the nation’s dependency on oil by using a sustainable, home-grown transportation fuel that will help reduce greenhouse gas emissions.”

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