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New Energy Capital Leads Equity Investment in Indiana Ethanol Plant

Posted on: Thursday, 1 September 2005, 12:00 CDT

At a ground breaking today featuring U.S. Congressman Peter Visclosky, New Energy Capital Corp. announced the financial close and start of construction of a 40 million gallon per year ethanol production facility. The Iroquois Bio-Energy Company (IBEC), located in Rensselaer, Indiana will produce ethanol from corn grown by local farmers and will also produce distillers grains, a high quality feed supplement ideal for the region's growing dairy industry. Ethanol from the plant will be blended with gasoline for use in the transportation sector. By reducing gasoline use, ethanol cuts U.S. oil dependence, stimulates the nation's farm economy, and reduces greenhouse gas emissions.

New Energy Capital provided a majority of the equity for the IBEC project, secured a $38.6 million loan from Farm Credit Services of Mid-America and will undertake financial and asset management for the approximately $70 million project. Fagen, Inc. is constructing the facility. Plant design and process technology will be supplied by ICM, Inc. The Andersons, Inc. will provide grain origination and risk management services. Noble Americas, Inc. will market the ethanol. Most of the plant construction will be carried out under a Project Labor Agreement with the Northwestern Indiana Building and Construction Trades Council, AFL-CIO. On-site construction will average about 60 workers and operations will involve more than 30 direct jobs.

Other equity investors include nearly 300 local farmers and businesses, Fagen Inc., The Andersons Inc., Noble Americas Inc. and Indeck Energy Services Inc. The U.S. Department of Energy (DOE) provided a grant to the project as a result of federal appropriations secured by U.S. Congressman Visclosky.

Congressman Visclosky said: "This ethanol plant is a perfect example of communities using their resources to create new economic opportunity. The success of this facility is a shared success between the local farmers, the people who will be put to work, and the entire region."

New Energy Capital CEO Scott Brown said: The IBEC project is ideally situated in a highly productive corn-growing region, with strong local markets for ethanol and distillers grains. We are fortunate to be working with highly capable partners, and are confident this project will provide strong economic benefits and skilled jobs to the local community, as well as critical environmental and energy security benefits for the country."

Dan W. Reicher, New Energy Capital President and former United States Assistant Secretary of Energy, said: "Ethanol is an attractive fuel for the US market with the rapidly rising cost of gasoline, concern about the nation's increasing reliance on imported oil, and the challenge of global climate change."

Ron Gick, IBEC President said: "The IBEC plant will be an attractive plant in the rapidly growing ethanol industry. Locally, there is great excitement about the economic development the plant will spur in terms of jobs as well as outlets for Indiana agricultural products."

In addition to Congressman Visclosky, today's ground breaking will include DOE Midwest Regional Office Director Peter Dreyfuss, Indiana Department of Environmental Management Commissioner Thomas Easterly and a number of local officials and union representatives.

New Energy Capital Corp. (www.newenergycapital.com) is a New England-based company that invests in, owns and operates renewable energy and distributed generation projects. These include a biodiesel production plant in Delaware, cogeneration projects in California and Massachusetts, and a biomass power plant in Maine. The Company is funded by VantagePoint Venture Partners (www.vpvp.com) one of the nation's largest and most active venture capital firms, and the California State Teachers' Retirement System (CalSTRS).

Source: Business Wire

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