Pa Governor Rendell Says Alternative Fuel Industry Growing; Announces $10 million to Develop Homegrown Fuels, Replace Foreign Oil

Says Applications Prove Businesses Eager to Invest in PA

    HARRISBURG, Pa., Oct. 16 /PRNewswire-USNewswire/ -- Governor Edward G.
 Rendell today said Pennsylvania is reducing its dependence on fossil fuels
 by supporting 24 new projects that will replace nearly 95 million gallons
 of conventional diesel fuel with homegrown biodiesel, expand Pennsylvania's
 infrastructure, and spur innovation in alternative fuel technologies.
 
     "Pennsylvania and the United States are dangerously dependent on
 foreign oil," said Governor Rendell. "That puts our economy and the
 American way of life at the mercy of nations that are often politically
 unstable or hostile. If we're to protect our national security and ensure
 our economy is not vulnerable to political upheavals or natural disasters
 elsewhere in the world, we must invest in the technologies and industries
 that will reduce this dependence."
 
     The Governor announced $10 million in grants through the Alternative
 Fuels Incentive Grant program that will leverage another $108 million in
 private investment to expand the production and use of homegrown biofuels.
 The investments will support research into new potential fuel sources that
 will help the state meet its energy demands using domestic alternatives.
 
     "These projects will help grow the state's economy by creating more
 opportunities in rapidly growing industries," the Governor said.
 
     "This year, Pennsylvania will spend nearly $30 billion to purchase gas
 and liquid fuels from beyond our borders," he said. "Rather than sending
 that money abroad, we're making a commitment to work toward energy
 independence and invest that money here. That means supporting the farmers
 who grow the crops that create ethanol and biodiesel, the manufacturers who
 turn those crops into fuel and the trucking companies and railroads that
 ship the final product to the retailer.
 
     "And at each step along that supply chain, there's a job for
 Pennsylvania's hardworking men and women," the Governor said.
 
     The grants announced today will help Pennsylvania meet the goal
 Governor Rendell established under his PennSecurity Fuels Initiative --
 producing and consuming nearly 1 billion gallons of biofuel by 2017. The
 amount is equal to what the state will import from the Persian Gulf by that
 time. The initiative is included in the Energy Independence Strategy
 Governor Rendell first unveiled in February and currently awaiting
 legislative action.
 
     The PennSecurity Fuels Initiative will require that every gallon of
 gasoline sold in Pennsylvania include 10 percent ethanol once in-state
 production reaches 200 million gallons per year; and every gallon of diesel
 fuel will include 2 percent biodiesel once production reaches 30 million
 gallons per year with incremental increases up to 20 percent once annual
 production reaches 300 million gallons.
 
     Governor Rendell convened a special session of the General Assembly
 dedicated to considering the Energy Independence Strategy, including the
 PennSecurity Fuels Initiative. In an address to a joint session of the
 General Assembly last month, the Governor said the time to act on pressing
 energy issues is now, and that a failure to do so will leave Pennsylvania
 trailing other states.
 
     The Governor said this year's Alternative Fuels Incentive Grant, or
 AFIG, round was the first where the total grant amounts requested by
 applicants exceeded available funding; proof, he said, that companies are
 anxious to invest and create jobs in Pennsylvania.
 
     A study commissioned for Citizens for Pennsylvania's Future by LECG LLC
 examined the benefits of offsetting 900 million gallons of petroleum-based
 transportation fuel with renewable and coal-derived fuels by 2017, as
 called for in the Governor's plan. The study concluded the following:
 
     -- Replacing 900 million gallons of petroleum-based transportation fuel
        with domestically produced biofuels by 2017 will add nearly $1.5
        billion to Pennsylvania's economy.
     -- The increase in gross output from the production and construction of
        new capacity will help create as many as 25,775 new jobs in all
        sectors of the Pennsylvania economy by 2017.
     -- The increased production of biofuels and coal-derived fuels will put
        an additional $6.6 billion into the pockets of Pennsylvanians over
        the next decade.
 
     In addition to supporting technology advancements, the alternative fuel
 grants announced today also expand the market for homegrown fuels by
 providing financial incentives to producers. The program awards
 5-cents-per-gallon to Pennsylvania biodiesel and ethanol producers, up to
 12.5 million gallons in 12-month periods.
 
     The grants also provide $1.6 million in incentives for early adopters
 of homegrown fuels. AFIG grants reimburse municipal and nonprofit fleet
 operators for the added cost of purchasing biofuels. Because there are no
 mechanical changes needed for vehicle fleets to operate on the
 cleaner-burning biodiesel, the switch to this fuel is relatively simple. It
 has been shown that biodiesel reduces wear on engines and helps to cut down
 on maintenance expenses.
 
     Since the grant program's inception in 1992, DEP has invested nearly
 $42 million through AFIG for more than 1,000 projects in almost every
 county of the commonwealth. Those funds have leveraged more than $225
 million from public and private fleet operators, fuel providers and the
 federal government.
 
     For more information, visit www.depweb.state.pa.us, keyword:
 Alternative Fuels.
 
     The Rendell administration is committed to creating a first-rate public
 education system, protecting our most vulnerable citizens and continuing
 economic investment to support our communities and businesses. To find out
 more about Governor Rendell's initiatives and to sign up for his weekly
 newsletter, visit his Web site at: www.governor.state.pa.us.
 
     EDITOR'S NOTE: Following is a list, by county, of the 24 recipients
 receiving $10,033,231 through the Alternative Fuels Incentive Grants.
 
     ALLEGHENY COUNTY
 
     United Oil Company -- $350,000 production incentive for 7 million
 gallons of biodiesel over the next two years. United Oil Company was
 Pennsylvania's first commercial biodiesel producer.
 
     Port Authority of Allegheny County -- $1.15 million for the incremental
 cost of purchasing 1.7 million gallons of biodiesel for its municipal bus
 fleet.
 
     BEAVER COUNTY
 
     PA Biofuels -- $400,000 to support construction of an
 18-million-gallon-capacity biodiesel plant. The state-of-the-art processing
 technology, developed in collaboration with the Center for Advanced Fuel
 Technology at Carnegie Mellon University, reduces operating costs by 30
 percent as compared to a conventional system. The technology features a
 modular, scalable design.
 
     PA Biofuels -- $625,000 production incentive for 12.5 million gallons
 of biodiesel over the next two years.
 
     CENTRE COUNTY
 
     Centre LifeLink EMS Inc. -- $1,800 for the incremental cost of
 purchasing biodiesel for nine vehicles that run on the biofuel. Centre
 Lifelink is a not-for-profit ambulance service.
 
     CHESTER COUNTY
 
     Pennsylvania Sustainable Technologies -- $292,000 to develop and deploy
 technology to convert a wide range of biomass, coal and other fuel
 materials into liquid transportation fuels.
 
     CUMBERLAND COUNTY
 
     Cumberland County Transportation Department -- $25,080 for the
 incremental cost of purchasing 132,000 gallons of B20 (20 percent
 biodiesel) for two years to power county vehicles.
 
     DAUPHIN COUNTY
 
     Middletown Biofuels LLC -- $454,200 to expand and convert an existing
 2-million-gallon-per-year batch biodiesel production facility into a
 6-million-gallon-continuous-production facility using new technology for
 biodiesel conversion, purification and methanol recovery. The application
 of these new technologies will reduce production costs and overall process
 cycle time.
 
     DELAWARE COUNTY
 
     Haverford Township School District -- $41,600 for the incremental cost
 of purchasing 200,000 gallons of B10 for school buses and maintenance
 vehicles.
 
     Radnor Township School District -- $40,000 for the incremental cost of
 purchasing 94,000 gallons of B20 for two years and to prepare storage tanks
 for biodiesel.
 
     ERIE COUNTY
 
     Millcreek Township School District -- $18,326 for the incremental cost
 of purchasing 368,000 gallons a year of B5 for a 95-vehicle school bus
 fleet over two years. Millcreek is replacing half of its bus fleet with
 state-of-the-art buses capable of using higher percentage biodiesel blends.
 
     LUZERNE COUNTY
 
     Alternative Fuels Inc. -- $1 million production incentive for
 approximately 20 million gallons of biodiesel. Alternative Fuels Inc.
 intends to produce more than 25,000 gallons per day of fuel derived from
 algae for its planned 50-million-gallon biodiesel plant.
 
     LYCOMING COUNTY
 
     Choice FuelCorp Inc. --- $250,000 production incentive for 5 million
 gallons of biodiesel.
 
     MONTGOMERY COUNTY
 
     Colonial School District --- $35,000 for the incremental cost of
 purchasing 240,000 gallons of B20 for use in school buses over two years.
 
     Lower Merion School District -- $23,370 for the incremental cost of
 purchasing 150,000 gallons of B20 in a fleet of 43 diesel-powered vehicles.
 
     NORTHAMPTON COUNTY
 
     Lower Saucon Township -- $2,520 for the incremental cost of purchasing
 30,000 gallons of biodiesel over two years and for the cleaning of a
 dedicated storage tank. Biodiesel will be used in highway and fire
 department vehicles, with biodiesel concentrations increasing from 5
 percent up to 20 percent within a year.
 
     PHILADELPHIA COUNTY
 
     Biotechnology Foundation Inc. Thomas Jefferson University -- $1 million
 to support the research of engineering tobacco plants for the production of
 biodiesel oil and ethanol. Modification and manipulation tobacco's oil
 generation could yield superior quantities of oil per acre than soybeans
 and significantly cut costs. After oil is extracted for biodiesel
 production, the remaining sugars, starch and cellulose-matter could be
 converted into ethanol.
 
     Energy Cooperative Association of Pennsylvania -- $300,070 for the
 incremental cost of purchasing 2.27 million gallons of B20 for five school
 systems -- West Chester, Chester County Intermediate Unit, Coatesville,
 Downingtown and Kennett Square -- through a partnership with Krapf Bus
 companies.
 
     SCHUYLKILL COUNTIES
 
     Green Renewable Energy, Ethanol & Nutrition Holding LLC -- $750,000 to
 support the installation of a corn oil extraction system that creates a
 biodiesel feedstock from distillers dried grain, a byproduct of production
 at the company's 100-million-gallon ethanol plant now in development. The
 extraction system captures up to 75 percent of the corn oil left in the
 distillers dried grain. It will produce approximately 7.5 million gallons
 of corn oil for biodiesel production.
 
     YORK COUNTY
 
     United Biofuels Inc. -- $273,252 to support increased biodiesel
 production through use of alternative feedstocks, such as waste poultry
 fat. United Biofuels also expects to modify its operations to reduce energy
 and material costs and deploy a boiler that uses alternative feed stocks
 classified as wastes to provide steam.
 
     County of York, Department of Parks -- $847 for the incremental cost of
 purchasing 5,500 gallons of B20.
 
     MULTIPLE COUNTIES
 
     Rohm and Haas -- $752,000 to demonstrate a newly developed polymeric
 catalyst technology that produces biodiesel from low-quality feed stocks,
 including crude soybean oil, rendered animal fats, waste vegetable oil and
 yellow grease. This technology will expand the field of available
 feedstocks, giving biodiesel producers greater flexibility and leading to
 increased volumes. The pilot scale facility will be mobile and made
 available for trial at other established biodiesel production facilities in
 Pennsylvania.
 
     Sunoco Inc. -- $372,846 to support the installation of refueling
 equipment for E85 (85 percent ethanol, 15 percent gasoline) at four plazas
 on the Pennsylvania Turnpike: Allentown, Sideling Hill, North Somerset and
 Valley Forge.
 
     All American Plazas Inc. -- $1.9 million production incentive for 37.5
 million gallons of biodiesel. All American Plazas proposes to build three,
 44-million-gallon biodiesel production facilities at three truck stops in
 Pennsylvania. All American Plazas anticipates production of more than 20
 million gallons per year at each plant over two years.
 
     CONTACT:
     Barry Ciccocioppo
     717-783-1116
 
     Neil Weaver (DEP)
     717-787-1323
 
 
 
 

SOURCE Pennsylvania Office of the Governor