The Saskatchewan government has made it easier for people to invest in biofuel facilities.
Acting on a recommendation from the Saskatchewan Biofuels Development Council, enterprise and innovation minister Lyle Stewart announced changes to a four-year, $80 million program announced by the previous government last summer.
The Saskatchewan Biofuels Investment Opportunity program provides repayable capital loans of up to $10 million per project for the construction or expansion of biofuel production facilities.
The funding is contingent upon a certain level of farmer-community investment in a project and is based on each facility’s production level.
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“The investment climate has changed … primarily due to higher grain prices,” Stewart told a news conference. “This has caused potential farmer investors to consider other types of investments.”
Changes to SaskBio include expanding the definition of eligible investors to include anyone living or doing business in the province, instead of just those within 100 kilometres of a project.
The maximum farmer-community investment has been lowered to 20 from 50 percent. And, the minimum program contribution has gone up to five cents per litre from two. The $10 million maximum loan remains in effect.
Judie Dyck, biofuel council president, said the changes make the program more flexible and should help the province expand from current production of 167 million litres per year. The council’s goal is production of 1.4 billion litres by 2015.
Two projects, at Unity and Tisdale, have already been conditionally approved for funding through SaskBio. Several others are in the works. Dyck said the program changes should help these others along.
Keith Rueve, chair of the council and the ethanol plant manager at Pound-Maker near Lanigan, said high feedstock prices are not the only reason that farmers aren’t investing in biofuel.
“It takes a lot of capital to build these large facilities,” he said.
Saskatchewan’s ethanol industry was developed during a period of depressed prices, he noted, and high feedstock prices are not likely to remain that way forever.
Stewart said Saskatchewan is the only province with a net feed grain surplus that can sustain biofuel plants without imports, even though corn is being used in some domestic plants already.
