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Catching up on yesterday’s news, the U.S. Department of Energy announced it’s investing up to $385 million in six cellulosic ethanol plants. Cellulosic ethanol is the great green hope as an alternative to corn ethanol. That’s because it can be made from everything from fast-growing plants like switchgrass to vegetable waste to wood chips, and it produces significantly lower greenhouse gas emissions than corn ethanol. A host of companies are gearing up to produce cellulosic ethanol, which involves a more complicated technological process. Among them, Range Fuels, a Colorado company backed by Silicon Valley venture capitalist Vinod Khosla’s firm, Khosla Ventures. Range is scoring up to $76 million in taxpayer cash over the next four years, which does raise Green Wombat’s eyebrows given Khosla’s not infrequent criticisms of solar energy as dependent on government handouts. The cellulosic ethanol companies that won the Department of Energy money are mainly startups, but they’re backed by some big corporate players. For instance, DuPont (DD) is involved with the Broin Companies of Sioux Falls, South Dakota, while Goldman Sachs (GS) and Royal Dutch Shell (RDS-B) are backing Iogen Biorefinery Partners of Arlington, Virginia. Waste Management (WMI) meanwhile is investing in BlueFire Ethanol, a Southern California company. The six companies are expected to eventually produce 130 million gallons of cellulosic ethanol year.
Green Wombat 