POET-DSM says Iowa cellulosic ethanol plant running by June

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An Iowa ethanol plant that will be one of the first producers of biofuels made from crop waste will be operating by June, a general manager of the plant said in an interview on Tuesday.

POET-DSM, a joint operation between leading U.S. ethanol maker POET LLC and Dutch food and chemicals group DSM, will be among the largest to make so-called advanced biofuels on a commercial scale.

The $250 million facility in Emmetsburg, in the north-central part of the No. 1 corn-growing state, will produce 7 million to 12 million gallons of ethanol this year using cobs and other corn "stover," said Steve Hartig, general manager for licensing for the ethanol plant.

"We'll probably be closer to the 7 than the 12," Hartig said of the ethanol output at the plant that will have an annual capacity to produce 25 million gallons of biofuel.

Advanced biofuel production is a linchpin of the 2007 Renewable Fuel Standard that was designed to promote homegrown fuels produced from corn, wood chips, grasses and crop waste.

Partially due to slow progress in large-scale production of cellulosic ethanol, the U.S. Environmental Agency last year proposed the first reduction in its volume targets for biofuel production.

If the EPA's targets are made official - a ruling is expected by mid-year - the government would mandate that 17 million gallons of cellulosic ethanol are produced to meet the Renewable Fuel Standard, down from 1.75 billion gallons proposed in the original mandate. That compares with the proposed volume of more than 13 billion gallons of ethanol made largely from corn.

"We'll be finalizing construction in March-April. Then we'll be starting it up. The ethanol will probably be in June, a lot of the units will be operating in May," POET-DSM's Hartig said from the sidelines of the National Ethanol Conference being held in Orlando, Florida, this week.

Abengoa Bioenergy's cellulosic plant in Hugoton, Kansas, also is expected to open later this year with an annual capacity of 25 million gallons. DuPont is constructing a cellulosic ethanol facility in Nevada, Iowa, with a capacity of 30 million gallons.


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