Jan. 4 (Bloomberg) — Sweetwater Energy Inc., a closely
held company that extracts fermentable sugars from biomass,
agreed to supply a standard corn-ethanol plant in Wisconsin that
plans to produce renewable fuel from non-food crops.
The deal with Ace Ethanol LLC is worth as much as $100
million over 16 years and the plant expects to shift as much as
7 percent of its 46 million-gallon (174 million-liter) annual
production capacity away from corn, Rochester, New York-based
Sweetwater said today in an e-mailed statement.
Producing biofuel from the sugars will let Ace diversify
its product line, according to Sweetwater President Jack Baron.
Demand for cellulosic fuel, made from non-food sources, is
guaranteed by federal regulations, and shifting away from
standard ethanol will be “a major hedge against high priced
corn,” he said.
“Most ethanol producers that we speak to would like to
consider options beyond ethanol,” Baron said today in a phone
interview. Closely held Ace may eventually use the sugars to
produce other higher-value products such as biochemicals or
bioplastics, he said.
U.S. gasoline and diesel producers are required to blend 36
billion gallons of biofuel a year into their products by 2022,
including 16 billion gallons of cellulosic biofuel.
Sweetwater will build and operate systems adjacent to Ace’s
plant in Stanley, Wisconsin. It will convert about 100 tons a
day of hard woods into sugars beginning in mid-2014, and the
technology can also run on agricultural waste and energy crops,
Baron said.
Sweetwater expects to have three additional facilities
operating next year, said Baron. He wouldn’t name any potential
new customers and said the company might “have more
announcements later this month.”
To contact the reporter on this story:
Andrew Herndon in San Francisco at
aherndon2@bloomberg.net
To contact the editor responsible for this story:
Will Wade at
wwade4@bloomberg.net
