The Free Press, Mankato, MN

Local News

December 5, 2009

Ethanol plant ramps up

Janesville plant started operations Nov. 1

JANESVILLE — It’s what residents in the Janesville area have been waiting to see — semi trucks filled with farmers’ corn lined up at the ethanol plant just east of town.

“It’s a big plus for the community,” said Mayor Alvin Grams. “The farmers are all happy — they’re getting a premium price for their corn. For the people working there it’s a very positive thing.”

The only complaint he’s heard from farmers is that the plant can’t take its full capacity of corn as it works up to full production.

Don Gales, the new CEO of the plant, said operations have been smooth since startup began Nov. 1.

“It’s been fantastic. With any startup, everything isn’t perfect, but it’s gone very well.”

The new plant, which can produce 120 million gallons of ethanol annually, has been a sore spot for Waseca County for more than a year.

VeraSun bought the property, before it was completed, in 2007 when it acquired U.S. BioEnergy Corp. But VeraSun declared bankruptcy in November 2008. AgStar and other lenders then purchased the idled plant for $55 million and this summer sold it for an undisclosed amount to Guardian Energy, a consortium of Midwest ethanol plants.

Now, the plant employs 50 people, and will add a few more, making it Janesville’s biggest employer other than the school district. It will also become one of the biggest property taxpayers in the county.

Guardian, which will grind more than 100,000 bushels a day, or 40 million bushels a year, had to get contracts with area farmers for corn.

“We’ve got a decent amount of corn to arrive. We’ll contract out through next year’s new crop,” Gales said.

On most weekdays, trucks from an 80-mile radius have been lining up as the plant dumps about 250 semis daily.

The ethanol is shipped out by rail.

“Most of it’s going to the east coast,” Gales said. “One of the benefits of this location is it has a fantastic rail system. We get more attractive freight charges because we can load 80 to 100 (tanker) cars in one group.”

Gales, who lives in Minneapolis, is originally from South Dakota, and spent eight years as CEO of Watonwan Farm Services in southern Minnesota.

The plant also produces dry distillers grain, a byproduct of the ethanol process.

“It’s a fantastic livestock grain. A good fiber and fat profile,” Gales said.

Grams said he expects the local feed-grain source could spur building of feedlots. “I kind of expected feedlots to open. But maybe they’re waiting. The markets been bad for livestock, especially hogs,” Grams said.

The plant runs 12-hour shifts and operates 24/7, 365 days a year.

“They’re good jobs,” Gales said. “We pay good compensation and good benefits. We want to be a good member of the community.”

Grams said employees at the plant give it high marks. “The people working there are happy with the people they’re working for,” Grams said. “It’s good to see anything going in this economy.”

He said the startup of the plant and a good harvest by area farmers has taken some of the edge off the recession. “We’re very fortunate here. In Iowa and north of here, it’s been too wet and a lot of crops haven’t gotten out.”

The new plant has advancements many of the older ethanol plants don’t have, including a zero water discharge operation. Ethanol plants have been criticized for the large amounts of water they use.

“We clean it up and recirculate it back into the plant operations,” Gales said.

Gales said they may not produce 120 million gallons in the first year. He said that because it’s a biological process, care has to be taken to produce the ethanol and distillers grain correctly.

“You need to make sure you don’t get any viruses or infections in the product. You can’t just throw on the switch and be to full operation.”

The company continues to put some finishing touches on the plant, including a perimeter fence that can be locked.

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