Clean Energy Capital LLC, a US private equity firm specializing solely in investments in ethanol, is developing the first major sugarcane ethanol refinery in the continental United States, in the Imperial Valley of California.
The ethanol produced there will meet California’s low carbon fuel standard. The project will cost $575 million and produce 66 million gallons of ethanol annually, enough electricity to meet the needs of 35,000 homes, and enough biomethane to heat 10,000 homes per year. Sweet sorghum, which has similar characteristics to sugarcane, will also be used.
There will be strong demand for ethanol from the refinery because the ethanol produced will meet stringent low carbon fuel mandates imposed anywhere in the US.—Scott Brittenham, CEO of Clean Energy Capital
Other states are considering adoption of the same low carbon fuel standard as California, including Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington.
The business model locks in prices with long-term contracts for the sale of the ethanol to a major international oil company and the purchase of the sugarcane from local farmers. This will provide greater stability in profit margins, according to Clean Energy.
States such as Alabama, Florida, Georgia, Hawaii, Louisiana, Mississippi, South Carolina and Texas, where sugarcane can be grown, are prime locations for building sugarcane ethanol refineries, Clean Energy says.