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Local ethanol plant on slow burn

Fuel future: Plans for ethanol production have stalled in Australia but continue in the US.

Holden still committed to ethanol production in Australia despite dragging progress

Holden logo12 Jul 2012

HOLDEN’S mooted ethanol production facility for Australia appears to have stalled, despite a successful test in the United States last year.

The Holden plan to build a $300 million plant to produce ethanol fuel from household waste is part of an association with American biofuel producer Coskata.

Coskata is due to begin production at its first commercial facility in the US state of Alabama during 2013 – also later than its original intention of this year – and has gone quiet since announcing its intention to sell shares in the company and raise $100 million for investment.

Holden energy and environment director Richard Marshall told GoAuto this week that progress has been slow with the revolutionary process that promises to turn trash from household rubbish bins into ethanol ready to pump into the family car, using a unique micro-organism.

“I don’t have much to report, to be honest,” he said. “We’re still just doing investigations.

“A lot of things move more slowly than I’d hope – that’s just the nature of the business. Essentially, the whole financial market at the moment is a fairly challenging space.

 center imageFrom top: Holden's Richard Marshall Coskata process bio-ethanol plant diagram.

“I’m confident the whole thing of waste-to-ethanol will happen (but) it certainly hasn’t taken place as fast as we would have liked and there’s been a number of reasons for that.

“I think overall the industry is still suffering from the GFC – capital is still really short and now, with this downturn and the concern in Europe and so on, that’s holding back capital for these sorts of projects.

“You’ve still got all these competing technologies lined up at the gate, but they’re all just waiting to get that funding.” More than three years ago, Wes Bolsen – a Coskata executive described by Mr Marshall as “an optimist” who has since moved to a rival biofuel company – visited Australia and held discussions with the Victorian, Queensland and New South Wales governments about building an ethanol plant here.

However, Mr Marshall said the discussions with governments have since revolved around issues other than funding, and were progressing, if slower than expected.

He said the discussions included issues such as potential locations and planning issues because the plant would be a big industrial facility that people were unlikely to want in their backyards, and securing ongoing ‘feedstock’ (rubbish) from council tips.

“There are a whole lot of things we’ve got to get into place to get a project up, so we’re talking to the government about things from how you secure all the waste that’s required all the way through to the ethanol at the other end,” he said.

“We weren’t asking for money it was more around the various policies.

“For example, just the way the waste is done in Melbourne. The various councils have control of the waste, so if you’re going to put a facility like that in, you need to be confident you’re going to get enough feedstock over a long period of time to make it viable.

“The last thing you want to do is build it and in five years’ time have no feedstock.” Despite the issues confronting both Coskata and Holden, Mr Marshall – who drives his company car on high-ethanol E85 fuel – is confident that the business model is sound and will produce results.

Last August, a batch of Melbourne household waste was shipped to Coskata’s proof-of-concept pilot plant in Pennsylvania – which has been operating since October 2009 – and was successfully turned into renewable ethanol fuel.

“We think the model we have is really good,” said Mr Marshall.

“We’ve spent the last 12 months refining the model and doing a lot of work on the tests that we did in the US, which was all done on Melbourne-based municipal waste plus a range of other feedstocks.

“Essentially, over the last 12 months we’ve really been refining that and looking at different mixes of feedstocks and so on to maximise returns and optimise throughput of the plant and we’re pretty confident we’ve got a very solid and robust model.”

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