Plans are brewing for ethanol plants

Two months after President Bush signed a comprehensive energy bill, a bill that calls for increasing production of alternative fuels like ethanol, several investors and companies are considering building ethanol plants in East Central Illinois.

Patrick Harroun of Thawville and his son, Andrew Harroun of Onarga, are proposing an ethanol plant for north of Roberts. A Dallas company called The Panda Group recently announced plans for a plant near Gilman. Alliance Grain Cooperative of Gibson City is considering building a plant in the region. And supporters of a plant for Tuscola are still mulling over the idea.

"We have been investigating wind power and alternative energy for some time now, and ethanol is the pride of the fleet, so to speak," said Patrick Harroun.

For two years, he and his son have been focusing on ethanol and zeroed in on a site north of Roberts along Illinois 54 near the Canadian National Railway line. On Thursday, the Ford County Planning Commission recommended that the Board of Appeals grant the Harrouns a conditional-use permit to produce ethanol in the industrial district. The Board of Review will hold a public meeting on the topic at 7:30 p.m. Nov. 8. in the Roberts gymnasium.

Their $62 million plant, A-1 Ethanol +, would produce 50 million gallons of ethanol a year. It would use 17 million bushels of corn and 150 million gallons of water annually. They'd like to start production in December 2006, but that may be delayed due to the contractor's schedule, Harroun said.

If all goes well, they might increase the ethanol output to 100 million gallons a year, Harroun said.

And after the Roberts plant is up and running, they may build another in Champaign County.

This is the first ethanol venture for the Harrouns, who have worked in the construction industry as general contractors. It will be a private venture and set up as a limited liability company.

Community response so far has been positive, the Harrouns said.

"I'm for them if it helps the price of corn," said Floyd Otto, a farmer from Roberts who sits on the Ford County Board. "It will bring more business to the county and will help the county finances," he said.

"We've got the corn here. The gas line is available. We have rail," said David Treece, manager of the Ford-Iroquois Farm Bureau.

The byproducts of ethanol, which are called distillers dried grains, are often fed to livestock. But there are few livestock farms in the region. However, Treece said, down the road the availability of feed might be an incentive for livestock farms to locate in the area.

Ethanol plants are viewed as a positive for the agriculture community because they add another market for corn, Treece added.

"Another outlet for the corn would bring more competition for the bushels and that would help the local price," Treece said.

Meanwhile, Panda Development Group is proposing a 100-million-gallon ethanol plant on a site 1 mile east of Gilman, north of U.S. 24. The natural gas-powered plant may be operational in 2007. It will employ about 40 employees.

The Iroquois County Board recently approved the company's request to rezone the site from agriculture to industrial, with the condition that if the project does not happen, the site reverts back to agriculture, said Jim Reynolds, executive director of the Iroquois Development Commission.

"It is beyond the talking stages and it is moving along," Reynolds said. "The folks in Iroquois County are overwhelmingly in favor. There are always legitimate questions – will it affect the neighboring (water) wells, how will this affect the smaller area elevators, will it emit any odors. Most (questions) appear to have been satisfactorily dealt with and the majority of residents are excited," he said.

In Douglas County, organizers are working on a feasibility study and considering applying for state and federal grants, said Dustin Blunier, Douglas County Farm Bureau manager.

Planning an ethanol plant, from conception to production, can take 18 months to two years – and that's on an aggressive schedule, said Mark Lambert, communications director for the Illinois Corn Growers and Corn Marketing Board.

For any new businesses, people have to do a lot of homework, Lambert said.

"There are the basics, as in, are we putting it in the right place?" Lambert said. Companies need to build plants where they have access to reliable transportation and where there is enough corn and water to supply the plant.

Water availability is an issue at any ethanol plant site, said Allen Wehrmann, director of the Center for Groundwater Science at the Illinois State Water Survey. The only way to find out if there is enough water for an ethanol plant is to test for it, he said.

"In the case of Roberts and Gilman, there are irrigation wells nearby, which suggests there is water nearby, but with that said, anytime you put in a high-capacity well, there are going to be impacts," he said.

When you pump out water, water levels go down, he said. Whether that has an impact on neighboring wells will depend on the depth of the other wells as well as the depth of the wells' pumps, Wehrmann said.

Another major hurdle for ethanol plant developers is financing, Lambert said. Then there is the issue of how to structure the company (Will it be a cooperative? A limited liability company?) Other decisions are choosing a contractor and determining how to power the plant (natural gas or coal?)

"It can be very complex," Lambert said.

To help budding ethanol developers, the Illinois Corn Marketing Board has approved six $2,500 grants for pre-feasibility studies for ethanol plants. It has also given out four $20,000 grants for feasibility studies for new plants.

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