Tuesday, June 10, 2008

Sweet Sugar Ethanol Coming Stateside

The American ethanol industry, the world’s largest, is about to get a little sweeter. Louisiana Green Fuels (LGF), an international investment group, says it is on schedule to open up the first commercial sucrose-to-ethanol plant in America. LGF, which is 80 percent owned by Inverandino, a Colombian business group, tells Earth2Tech it plans to have four ethanol plants and three sugar mills in operation in Louisiana in the next 10 years pumping out 100 million gallons of sugar-based ethanol a year. (Hat tip Miami Herald, via Green Car Congress)

In the wake of hurricanes Katrina and Rita LGF has been buying up shuttered sugar mills and dormant equipment in the devastated Gulf region, and now owns three mills in Louisiana. Prices were probably pretty good for those hurricane-ravaged mills and LGF says that a sucrose-based ethanol industry could help revitalize the area.

Louisiana seems to agree and has done lots to help LGF. The state sold the company one of its mills in September 2007 and just last month issued $133 million in industrial development revenue bonds via the Louisiana Public Facilities Authority, $100 million of which is tax-exempt.

The initial funding for the projects came from the Santacoloma family of Colombia which controls Inverandino. The company has not disclosed how much it plans to invest in the projects, but it was reported it paid $60 million for the state-owned mill in Lacassine, LA.

LGF, which is 20 percent owned by the sugarcane farmers of the Lake Charles Cane Cooperative, says it plans to buy as much sugarcane and sweet sorghum locally but will import high test molasses, refined sugar and common molasses, likely from the Caribbean, as needed.

This is a good experiment for the American ethanol industry which has come under heavy fire for using so much corn for fuel. Sugar can give an eightfold return on the fossil energy used to make it while corn only yields 1.3 times the fossil energy used. Count sugar in as a potential major player in U.S. biofuels market. Who thinks America will see a commercial-scale cellulosic or sugar ethanol plant here first.

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