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Investors raise $7 million for Iowa biodiesel factory
Iowa Correspondent

NEWTON, Iowa — Investors hoping to finance a newly proposed central Iowa biodiesel plant kicked off their Jan. 12 equity drive, raising more than $7 million to construct the 30-million gallon continuous flow facility in rural Newton, Iowa.

“It’s rewarding to be able to open our equity drive,” said John Van Zee, Central Iowa Energy, LLC (CIE) board member and Prairie City, Iowa farmer, told the nearly 400 people attending the first of nearly 30 central Iowa community events.

“Central Iowa Energy intends to bring 28 good paying jobs to this community in addition to the benefits a $50 million project of this kind offers,” he said.

Formed in June 2005, the CIE’s board of directors hosted the Jan. 12 kick-off event at the Des Moines Area Community College (DMACC) Newton Conference Center in Newton as part of a series of 25 informational meetings slated for central Iowa communities interested in knowing more about Iowa’s sixth operational biodiesel plant.

Investors – who laid out a minimum of $25,000 towards CIE – said they wanted to help reenergize prices for Iowa soybean growers and stimulate the area’s economy that has recently been taking some financial hits from Newton’s largest employer, Maytag Corp., which was purchased by Whirlpool and leaning towards transporting jobs out of the area.

As part of their outreach, CIE is inviting the public to learn more about their project and biodiesel, and provide valuable feedback on the project, which currently have raised more than a third of the $17.6 million to $25 million needed from investors, which are made up of state farmers, small business owners and private investors.

“Alternative fuels like biodiesel made from Iowa-grown inputs are a tremendous opportunity,” said Jim Johnston, a rural Grinnell, Iowa farmer who chairs the CIE board of directors.

The newly proposed plant would use about 75 percent soybean oil and 25 percent animal fats to make biodiesel at a site on the Iowa Interstate Railroad in rural Newton, which plans to employ nearly 30 workers.

The move would also make CIE the third 30-million gallon biodiesel plant in the U.S. built to follow BQ9000 standards that guarantee the quality of the final product and assure that CIE fuel would meet the most stringent requirements of its end users.

The Newton, Iowa plant would produce 90,000 gallons a day and assured nearby residents that the 32-acre facility would not disrupt their quality of life.

With five plants now in the works, Iowa Secretary of Agriculture Patty Judge said that the state has “stepped up to the plate to become the nation’s leader in renewable fuels.”

Bill Horan, a CIE board director and Rockwell City, Iowa farmer, said biodiesel is friendly to the community because it’s odorless, uses soy and has “no dust issues.”

“It’s a resource produced here in Iowa,” Horan said. “Energy is something we need, and we can provide it from Iowa farms.”

According to the Iowa Soybean Assoc., as the nation’s leader in biodiesel as well as ethanol, Iowa currently has three biodiesel plants in operation; three facilities under construction; and 10-15 more plants now being considered for construction.

The Newton, Iowa plant is expected to begin production in January 2007.

Published in the January 25, 2006 issue of Farm World.