US Names Biofuel Projects Selected For $564M Funding

Nineteen biofuel refinery projects have been selected to receive as much as $564 million in funding under the economic stimulus program, the U.S. energy and agriculture secretaries said.

Although the funding is conditional on final contracts being signed, it is a major boost for the industry and will likely accelerate the expansion of the next generation of biofuels.

The money will fund construction and operation of pilot demonstration facilities and commercial-scale operations, validating refining technologies and helping to lay the foundation for full commercial scale development of a U.S. biomass industry, the departments of Energy and Agriculture said in statements.

The recipients include Sapphire Energy, Algenol Biofuels, Archer Daniels Midland (ADM), Clearfuels Technology and Solazyme.

Energy Secretary Steven Chu said in a statement that advanced biofuels are essential to building a cleaner, more sustainable transportation system in the U.S. Agriculture Secretary Tom Vilsack said the development of renewable energy is vital component of the administration’s efforts to rebuild and revitalize rural America.

Congress and the Obama administration are subsidizing the growth of nextgeneration biofuels to diversify the economy away from conventional crude products as part of a plan to cut oil imports and decrease greenhouse-gas emissions.

Paul Woods, chief executive of Algenol, said the $25 million for which his firm is eligible would dramatically shift the schedule for potential commercialization of their product. The money will finance a plant in Freeport, Texas, that the firm plans to have produce 100,000 gallons of ethanol in around two years.

“These funds are critical for us going forward on a much more expedited process,” he said in a phone interview.

Woods said Algenol’s facility is designed so that companies such as Linde AG (LIN.XE) and Dow Chemicals (DOW) can scale up production, creating critical mass for commercialization.

The DOE said $700 billion in private and non-federal funding would match the government financing authorized under the stimulus bill passed by Congress early this year.

CME Group