For other projects, securing the &ldquo;all-important&rdquo; air permit has been the last hurdle before construction begins. Montana Advanced Biofuels LLC, on the other hand, recently received its air permit from the Montana Department of Environmental Quality but is unable to move forward with construction on a 115 MMgy ethanol plant without a loan guarantee from the U.S. DOE. &ldquo;In this banking climate, we do not have alternative financing,&rdquo; Gary Hebener, president, told EPM.
Unfortunately, with the DOE loan guarantee program essentially on hold, that puts the ethanol plant project on hold too. Developers haven&rsquo;t given up over the last 20 years of unsuccessful attempts to build an ethanol plant in Great Falls, Mont., and they aren&rsquo;t giving up now. &ldquo;We are truly shovel ready, with all permits in hand,&rdquo; Hebener said. &ldquo;The site is fully developed and serviced.&rdquo;
The group is crossing their fingers that something will change and the DOE loan guarantee program will move forward. &ldquo;We have our equity commitment, we are just waiting on the DOE,&rdquo; he said.
The plan is to build a feed-grade barley and wheat ethanol plant. Coproducts produced at the facility will include 460,000 tons of barley meal and 25 tons of vital wheat gluten, a baking additive. The company plans to gasify hulls and husks from barley and other grain milling residue, to provide more than 90 percent of the plant&rsquo;s process energy. The hope is that the fuel produced will qualify as an advanced biofuel with the U.S. EPA, he said. The EPA has completed and approved the life cycle analysis for the wheat feedstock and is nearly done with the barley analysis. &ldquo;We&rsquo;ll have the lowest carbon footprint of any ethanol facility in America,&rdquo; Hebener said.
The project had previously made some significant progress, navigating the requirements of the loan guarantee program. After gaining part I approval in early spring 2011, the group submitted its Part II application, which was also approved. Going through the approval process is an &ldquo;extensive undertaking,&rdquo; Hebener said, pointing out that a copy of the application weighed just under 20 pounds. With Part II approval, applicants have one more step to go&mdash;due diligence. For that step an outside engineer is hired for technology review and a marketing consultant reviews the company&rsquo;s supply and offtake agreements. &ldquo;We welcome the opening of the program and DOE&rsquo;s assessments of those professionals, to make that final review,&rdquo; he said.
The group is seeking a 1703 loan guarantee, which is separate from the 1705 loan guarantee that was previously awarded the controversial company Solyndra Inc., which filed for Chapter 11 bankruptcy in August. The DOE loan programs office <a href="https://lpo.energy.gov/?page_id=45" target="_blank">website</a> lists only two projects under the category of 1703 the loan guarantee program, both nuclear projects with conditional commitments. To qualify for 1703 support from the DOE, projects must be &ldquo;innovative clean energy technologies that are typically unable to obtain conventional private financing due to high technology risks,&rdquo; the DOE loan program website said. &ldquo;In addition, the technologies must avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases. Technologies we will consider include: biomass, hydrogen, solar, wind/hydropower, nuclear, advanced fossil energy coal, carbon sequestration practices/technologies, electricity delivery and energy reliability, alternative fuel vehicles, industrial energy efficiency projects, and pollution control equipment.&rdquo;
Another 26 projects, including Agengoa Bioenergy&rsquo;s 23 MMgy cellulosic ethanol plant under construction in Hugoton, Kan., are listed under the 1705 category. The facility is expected to start up production in the fall of 2013 and received a $132.4 million <a href="http://www.ethanolproducer.com/articles/8479/next-up" target="_blank">loan guarantee</a> from the DOE in late September.&nbsp; Chris Standlee, executive vice president of Abengoa, confirmed April 2 that everything is moving forward as planned with that project. The biofuels facility is expected to create 300 construction jobs, 65 permanent jobs and avoid 139,000 tons of C02 yearly, the equivalent of taking 27,000 cars off the road, the DOE said.
The majority of the projects on the 1705 list are solar manufacturing or generation with a few wind, geothermal and other projects. That includes the Solyndra project, which received a $535 million loan guarantee in 2009. The Abengoa plant is the only biofuels project on the 1705 list. Abengoa does, however, have two other projects on the list. It received $1.446 billion and $1.2 billion loan guarantees for solar projects in Arizona and California in 2010 and 2011, respectively.
A request to the DOE for more information on the status of the loan guarantee program went unanswered.

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Montana Advanced Biofuels recently received its air permit but is unable to move forward with construction on a 115 MMgy ethanol plant without a loan guarantee from the U.S. DOE.

Proposed Montana ethanol plant hinges on DOE loan guarantee

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Upcoming Events

2024 International Fuel Ethanol Workshop & Expo

Biodiesel Summit: Sustainable Aviation Fuel & Renewable Diesel

Carbon Capture & Storage Summit

North American SAF Conference & Expo

2024 National Carbon Capture Conference & Expo

Proposed Montana ethanol plant hinges on DOE loan guarantee