Each year, the EPM staff compiles the most comprehensive list of proposed ethanol projects—those between conception and construction—that we can verify. Over the years, some of these projects have disappeared, some have been on the list several times and others are producing ethanol. In 2008, the list’s fifth year, EPM offers updates on 118 projects representing nearly 8 billion gallons of annual capacity.

This year’s list comes at a time when many in the industry are dealing with an uncertain economic landscape and possibly an uncertain future. Raising equity has been a large concern for future producers, and a number of the projects listed here reported significant delays and challenges associated with funding their respective plants. There are indications that with the passing of the Energy Independence & Security Act of 2007, investors and bankers may begin to view the market with optimism instead of skepticism.

The increasing cost of building materials is another major concern for future producers. Steel and copper prices are rising, and some contractors are receiving letters from steel suppliers announcing increased prices for structural and reinforcing steel. “AK Steel (Corp.) has upped its spot selling price for hot-rolled coil $30 per net ton, effective immediately, thereby bringing prices to $700 for April shipments,” according to Institute of Scrap Recycling Industries Inc. Price increases are blamed on increases in the cost of raw materials and energy.

Since 2004 when EPM first compiled a proposed ethanol plant list, there has been one constant: the North Central-West region—North Dakota, South Dakota, Nebraska, Kansas, Minnesota, Iowa and Missouri—has the largest number of proposed plants relative to other U.S. regions. Likewise, of all the plants currently producing, 69 percent (98 plants) are operating in that region. Conversely, the areas with the least amount of ethanol production are the South Central-East and South Atlantic. Currently, the South Central-East region represents 1.25 percent of U.S. ethanol production, or 98 MMgy from three plants. There is one ethanol plant in the South Atlantic: First United Ethanol LLC, a 100 MMgy facility under construction in Camilla, Ga.

A not-so-surprising change for those in the industry has been the increase in plant capacity over the years. In 2004, the average proposed project was roughly 44 MMgy. In 2008, that average number increased to more than 72 MMgy per facility. However, if history is any guide, fewer than one in 10 will break ground in the next 12 to 24 months.

As EPM does each year, it is important to stress the subjectivity of the data compiled with this list. From the time one list is published to the next, our staff and various industry players will forward news of proposed plants to our plant list and construction editor, who manages an internal plant list database. Each year, writers attempt to contact every project in the database. Some projects choose not to be included. Some don’t respond at all. Every project on this list has been verified by a company representative or affiliate, a third party involved with the project, or official public documentation. Statistically, this proposed plant list is a useful projection of the future ethanol industry.

PACIFIC
Treasure Valley Renewable Resources LLC
Location: Ontario, Oregon
Target groundbreaking: spring 2008
Feedstock: wheat/barley/corn
Capacity: 30 MMgy
Design/build team: Bratney Cos.
Synopsis: This $75 million facility will use fractionation technology, separating protein for food ingredients and starch for ethanol production. “We’re taking all the value out of the grain for human consumption,” says company manager John Hamilton. Equity has been raised for the project, and permitting and zoning are complete.

Inland Pacific Energy Center LLC
Location: Stanfield, Oregon
Target groundbreaking: spring 2008
Feedstock: corn
Capacity: 120 MMgy
Design/build team: Bratney Cos.
Synopsis: This $1 billion project, which includes biodiesel facilities, is expected to take 10 years to develop, although groundbreaking for the first ethanol plant and first biodiesel plant is expected this spring. In its entirety, the project will consist of three 40 MMgy ethanol plants adjacent to three 32 MMgy biodiesel plants, which will use canola oil as a feedstock. A feed mill will also be located on-site, blending several feed ingredients and coproducts to make a complete livestock feed. A biopower facility will create steam and electricity from the gasification of biomass, wheat straw and demolition waste. After initially looking for funding from local investors, the company abandoned that strategy to court major sources. “That’s looking very definite,” says Project Manager Bob Doughty. The company expected to complete its equity and debt funding in February.

American Ethanol Inc.
Location: Santa Maria, California

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