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Coskata Gets Big Loan Guarantee for Cellulosic Biorefinery

Cellulosic waste to ethanol start-up Coskata will receive a $250 million loan guarantee from the USDA to support its plan to build a 55 million gal/year biorefinery in  Greene County, Alabama. 

Coskata runs a pilot facility near Pittsburgh

Coskata has been operating a pilot plant since the Fall of 2009 in Madison, Pennsylvania (just outside of Pittsburgh) where it turns wood chips into ethanol. Here’s how I described the firm’s process when I visited the plant:

Converting feedstock to ethanol at the plant is a three-step process. The tour group observed wood chips being sucked out of a 500-lb bag and into a feed handler and then being sent to a gasifier. Ionized gases at temperatures of up to 2,500 °C vaporize the feedstock into a synthesis gas composed primarily of carbon monoxide and hydrogen.

The syngas is then cleaned and cooled; waste heat from the hot gas is used to turn a turbine and provide electricity to the plant. The cooled gas is piped to a series of bioreactors, where specially designed microbes feast on it and excrete ethanol. The microbes are a type of Clostridia bacteria that have been selected to produce only two-carbon alcohols, meaning Coskata does not have to separate ethanol from methanol.

In the final step, Coskata separates the ethanol from water by distillation to obtain fuel-grade ethanol.

Coskata points out in a statement that  USDA guarantee will be the largest ever awarded for a biofuel facility. 

“Today’s announcement by the USDA sends a clear message about the Administration’s commitment to advanced biofuels, and provides further validation that Coskata’s technology is ready for commercial scale,” said William Roe, Coskata’s CEO.  “This is a critical first step that will facilitate Coskata working with the USDA, and proceeding to raise the balance of the capital needed for the project.”

The two major hurdles that cellulosic fuels producers face, experts have said, is to manage costs as they scale up their untested technologies in a scaled-up form that is competitive with petroleum and to round up affordable financing to allow a first-of-its kind facility to be built. Loan guarantees like this USDA deal, as well as similar programs at DOE, are designed to help with the second problem.


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