A central Alberta ethanol plant will be able to increase production after a $23.2 million boost from the federal government.
Permolex Ltd. of Red Deer received the money under the federal ecoEnergy for Biofuels program.
The program supports production of renewable alternatives to gasoline and diesel and encourages the development of a competitive domestic industry for renewable fuels.
Red Deer member of Parliament Earl Dreeshen said the money will help create local jobs and cleaner fuels when he announced the funding April 8.
“In the long run, increasing our supply of cleaner fuels will also reduce greenhouse gasses and contribute (to) a healthier environment for all Canadians.”
Read Also
Agriculture ministers agree to AgriStability changes
federal government proposed several months ago to increase the compensation rate from 80 to 90 per cent and double the maximum payment from $3 million to $6 million
The plant uses feed wheat to produce ethanol. It also produces flour, gluten and livestock feed. The plant in Red Deer has been producing ethanol since 1998, originally as API Grain Processors.
The plant has already increased its ethanol production to 40 million litres from 25 million litres a year.
The federal government has mandated a five percent renewable fuel blend in gasoline by 2010.
The money will be paid quarterly over nine years in the form of a per-litre subsidy of up to 10 cents for ethanol during the first three years and will slowly decline.
The plant was expanded previously with the assistance of the federal government’s Ethanol Expansion Program.
“We are proud to have become part of the economic foundation of this community,” Permolex president Doug MacKenzie said in a news release.
