The U.S. Department of Agriculture (USDA) will provide a $91 million loan guarantee to help finance a new biofuel plant being built by Cool Planet Energy Systems in Louisiana, according to a press release.
The facility at the Port of Alexandria, Louisiana, will produce renewable fuels and biochar, a bioenergy byproduct, by converting pine chips into high octane gasoline and aromatic blendstocks that are said to be chemically identical to fossil fuels.
It is expected to have an output of approximately 8 million to 10 million gallons of reformate per year at full capacity. Reformate is an ingredient in gasoline and jet fuel that can be added during the regular refinery process, unlike many biofuels, like ethanol, that are instead blended into a finished product to oxygenate fuel.
Reformate enhances the energy content of gasoline, diesel and jet fuel, USDA explained.
In addition, the plant will produce a soil amendment product called CoolTerra, which enables agricultural producers to retain water and nutrients in soil to increase crop yields. In drought conditions it can help maintain crop yields with significantly less water and fertilizer.
Under the new funding arrangement, USDA has reached an agreement with Silicon Valley Bank to provide a Biorefinery Assistance Program loan guarantee to Cool Planet to help the company complete construction.
Cool Planet has also secured private investment from companies including Google Ventures, BP, ConocoPhillips, GE, Exelon and NRG Energy. Cool Planet will be contributing $50 million in equity to the project.