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Idaho Coalition Pushes Ethanol Plant by Dave Wilkins, Staff Writer Capital Press - June 7, 2002

TWIN FALLS, Idaho -- It's only a matter of time before Idaho gets a major ethanol plant, proponents of the alternative fuel predict.

"We've been talking lately to a few potential investors who look really promising," said Winston Inouye, chairman of the Magic Valley Energy Coalition. "It appears that the investors are out there."

At least three different groups across Southern Idaho from Payette to Idaho Falls are working on plans to build ethanol plants.

The J.R. Simplot Co. operates two small ethanol plants at Heyburn and Caldwell, mostly as a way of getting rid of potato waste. The plants each produce about 3 million gallons of ethanol a year.

Inouye is convinced that the first major ethanol plant in Idaho will be built somewhere between Wendell and Burley and that there may be several others constructed before the development is all over.

Idaho could produce 400 to 500 million gallons of ethanol a year, coalition members believe.

"That's what's so exciting for us and some of the investors that we've talked to," Inouye said. "We can't use that much ethanol in Idaho, but we could easily produce that much to serve the ethanol market."

A recent study conducted by BBI International of Cotopaxi, Colo., found that a plant capable of producing 20 to 40 million gallons of ethanol per year could be feasible in south-central Idaho.

The study evaluated nine different sites and identified one about three miles south of Burley as the best choice.

A 40 million gallon ethanol plant would cost an estimated $50 million to build to build. About $15 million would need to come from investors' equity and another $35 million from bank financing.

A group called the Idaho Ethanol Coalition was recently formed and has received encouragement from Gov. Dirk Kempthorne, state legislators and members of the state's congressional delegation.

Idaho Ethanol Coalition is an unincorporated group that's working on forming a limited liability corporation. People involved in it are mostly from the ethanol industry and from the three groups that are trying to develop new ethanol plants in the Treasure Valley, Magic Valley and Eastern Idaho.

"The main purpose of the Idaho Ethanol Coalition is to keep the public informed and to work with our state and federal governments in representing ethanol interests," Inouye said.

Simpson Crusading
Rep. Mike Simpson, R-Idaho, has become something of a crusader for ethanol. He's not only backed it with votes in Congress, but has pitched its benefits to motorists while pumping gas and washing windshields at several gas stations throughout the state.

As urban areas move away from the fuel additive methyl tertiary-butyl ether, a possible human carcinogen, ethanol will become even more important, Simpson said.

"They're going to have to go to an alternative oxygenation agent, and the one that makes the most sense is ethanol," Simpson said. "I think ethanol production is going to be huge."

Corn First
A 40 million gallon ethanol plant using corn as its feedstock would produce about 321,000 tons of distillers wet grain annually -- enough to feed an estimated 116,000 cows.

Corn was used in the Magi Valley feasibility study calculations because that's what most ethanol plants in the United States use as a feedstock. But corn would probably have to be brought in from the Midwest, whereas local farmers could provide much of the wheat.

"The banks and financial institutions that we've spoken to have said they have to make their decisions based on corn," Inouye said.

"the first year or two we may have to bring in corn, strictly to satisfy the financial institutions," he said. "But we certainly want to use the grain from this area and that is what we plan to do."

For more information, call Inouye at (208)654-2807 or (208)431-2807.