BCAP award will support 4,000 energy crop acres in NC

By Holly Jessen | June 15, 2012

A 20 MMgy cellulosic ethanol plant proposed for North Carolina will utilize a feedstock- flexible technology that enables it to take advantage of seasonal crop patterns to reduce feedstock cost. The feedstocks will include miscanthus and switchgrass thanks to a recently announced nearly $4 million Biomass Crop Assistance Program award. 

“We’re really looking at a multiple feedstock strategy for that plant,” said Dennis Leong, executive vice president of marketing and business development for Chemtex. “The BCAP [award] certainly supports miscanthus and switchgrass as a start.”

Chemtex, the global engineering and technology division of Gruppo Mossi & Ghisolfi, is the sponsor of one of two newly announced BCAP project areas, according to a June 13 USDA press release. BCAP, which is administered by the USDA’s Farm Service Agency, assists farmers and forest landowners with the startup costs required to plant new energy crops that take several years to reach maturity. Producers who voluntarily sign up for the program are eligible for reimbursements of up to 75 percent of the cost to establish perennial energy crops. They are also eligible for up to five years of annual maintenance payments for herbaceous crops and up to 11 years for wood crops.

More than 4,000 acres of miscanthus and switchgrass will be grown in 11 counties in North Carolina to support Chemtex’s proposed cellulosic ethanol plant in Sampson, County, North Carolina. The Biofuels Center of North Carolina identified the site selected for the proposed plant as Clinton, N.C., which is located about 70 miles south of Raleigh, N.C.

Referred to as Project Alpha, the 20 MMgy facility will be owned and operated by Beta Renewables, which is a joint venture formed between Chemtex and TPG Capital. However, other groups have expressed interest in the project and the final ownership makeup is yet to be determined, Leong said. Plant startup is expected in 2014—should the company’s application for a U.S. DOE loan guarantee receive approval. “The plant breaking ground is pending a decision on that,” he added.

Beta Renewables has invested more than $200 million in its trademarked feedstock flexible Proesa technology. The same technology is being used in the company’s first commercial-scale cellulosic ethanol facility currently under construction in Crescentino, Italy. The facility is expected to be mechanically complete this summer and should begin operations in the fall. The primary feedstocks for that plant include rice straw, wheat straw and Arundo donax, a variety of giant reed. 

When the company says its Proesa technology is feedstock flexible, it means the switch from one feedstock to another can be made without changing enzymes or hardware. However, that doesn’t mean multiple feedstocks should be thrown in the mix at the same time. “Generally what we say is that each feedstock has its own optimal conditions,” Leong said. “So what we would prefer to do is run on campaign basis. If you run miscanthus, you run miscanthus. If you run switchgrass, you run switchgrass. If you run a different feedstock, you run it separately.”

Moving forward, the company wants to license its technology to other project developers. “That really is our business model, taking it forward.” Leong said. “It’s certainly not Chemtex’s model to be an owner and operator.”

In all, USDA announced $9.6 million to create two new BCAP project areas in North Carolina and New York, as well as expanding an already established BCAP project area in Arkansas. In New York the funding will be used for growing a fast-growing shrub willow for electric generation. In Arkansas it will increase enrollment in a program to grow miscanthus for fuel pellets used for in-farm heating, export and biobased packaging.

BCAP is intended to expand the non-food, energy crops grown in the U.S. for a stronger energy future, Tom Vilsack, secretary of agriculture said in a USDA press release. “Because most energy crops are perennial and take time to mature before harvest, BCAP is designed so that sufficient quantities of feedstock will be available to meet future demand,” he said. “Most importantly: these crops can grow where other crops cannot, providing farmers with new opportunities to diversify into more markets.”

BCAP funding has been limited to $17 million, a 96 percent reduction from the amount available in the spring of 2011, the USDA noted in its press release. Nine BCAP project areas were selected in fiscal year 2011, resulting in the approval of more than 860 producer contracts on nearly 50,000 acres in 10 states.