Energy Department to Support Cellulosic Ethanol Plant

First commercial-scale cellulosic ethanol plant will be built in Iowa.

Published on: Jul 8, 2011

The U.S. Department of Energy has offered a conditional commitment for a $105 million loan guarantee to support the development of the nation's first commercial-scale cellulosic ethanol plant. Project LIBERTY, sponsored by POET, LLC, will produce up to 25 million gallons of ethanol per year in Emmetsburg, Iowa. POET estimates the project will generate approximately 200 jobs during construction and 40 permanent jobs at the plant, and also bring approximately $14 million in new revenue to area farmers.

In announcing the commitment ,U.S. Energy Secretary Steven Chu said the project will help decrease the nation's dependence on oil, create jobs and aid our transition to clean, renewable energy that is produced here at home. Chu called the innovations used in this project another example of how we are seizing the opportunity to create new economic opportunities to win the clean energy future.

Agriculture Secretary Tom Vilsack said projects like Project Liberty show that our investments in next generation biofuels are paying off. Vilsack says his USDA plans to make additional announcements within the next six months. It was unclear whether the DOE, which placed dozens of loan guarantee applications on hold in May due to the program's looming Sept. 30 expiration date, is also planning additional biofuels loan guarantee approvals.

According to Senator Chuck Grassley, R-Iowa, this pioneering facility will kick-start a major domestic industry producing advanced biofuels from plentiful feedstocks like crop residues, native grasses and woody materials.

The total project cost for Project Liberty is $261.2 million, according to the DOE. Initially, ethanol produced at the facility is expected to cost approximately 50 cents more per gallon than gasoline, but those costs are expected to be reduced over time. Chu said one of the most exciting aspects of Poet's project is its plan to locate cellulosic plants near traditional starch-based plants. Given that Poet operates a total of 27 corn-based ethanol plants throughout the U.S., the potential for widespread commercialization of cellulosic ethanol using Poet's technology is substantial. Poet has said it plans to produce 3.5 billion gallons of cellulosic ethanol by 2022.