Oshkosh, Wis.-Area Plant Banks on Alternative Fuel Growth

Jul 22 - The Post-Crescent

Jul. 22--A facility that plans to double its output of ethanol to 50 million gallons a year is hard at work on pursuing an allied task: development of the first area stations to dispense the alternate fuel.

"Our goal is to initially get 10 up this year, covering the northeastern part of the state," said Paul Olsen, president of Utica Energy, whose plant southwest of Oshkosh has been up and running for 15 months.

The nearest stations that dispense so-called E85, or corn-derived fuel consisting of 85 percent ethanol (grain alcohol) content, are five in Milwaukee and handful more throughout the state. While a growing number of Fox Valley motorists have purchased so-called flexible fuel vehicles that can safely run on such fuel blends, there are no stations for them to use in the area.

Meantime, Utica Energy has hit some hurdles trying to line up sources closer to the Fox Cities.

"You would think E85 fuel would be more readily available and on the front burner. What we find is there's a lot of hoops to jump through," Olsen said. "One of the big ones is getting above-ground fuel stations permitted in the state of Wisconsin. Now we finally got direction where we can get those accomplished."

Utica Energy expects revenues to edge past the $50 million mark this year, said Greg Pollesch, company controller.

Wisconsin and Illinois are the primary markets for the current 20 million gallons of ethanol produced.

To produce it, the company obtains 8 million to 9 million bushels of grain annually from farms within a 100-mile radius.

The elaborate fermentation process produces more than alcohol. Utica Energy sells useful byproducts, like liquid carbon dioxide and distiller's grain, which is used as a high protein feed supplement.

The firm, owned by Olsen and four other local farmers, employs 35, in addition to providing stable work for up to a dozen haulers who take the wet cake to and from suppliers for distribution to farms.

The industry is banking heavily on a growing acceptance of flexible fuel vehicles, a relatively inexpensive option.

"Engineers have designed those cars to handle the differences in fuel. They have special sensors, special fuel lines, fuel tanks and fuel pump," said Ken Kempfer, department chairman of transportation programs at Fox Valley Technical College.

Other advantages: high ethanol mixes can be used to power snowmobiles and all terrain vehicles.

There are drawbacks. E85 fuel provides worse gas mileage -- 13 miles per gallon vs. 18 miles per gallon for one new truck model -- than conventional unleaded fuel.

But proponents say that's tolerable if the need to fill up more frequently is offset by the lower cost per gallon for E85, something likely to be the case once corn stocks become plentiful again and gas prices continue to soar.

Folks driving non-flexible fuel vehicles will have to wait.

"If you have just a conventional car, it will destroy the fuel pump, dry out the seals on the injectors," said Kempfer. "Like taking diesel fuel. It's not compatible."

Advocates are hoping that motorists will rally around moves to free heavy dependence on foreign oil, that environmentally-friendly fuels will grab more and more of the market and cheaper prices at the pump will eventually be the rule.

Kempfer said the last factor already is coming into play.

"One weekend a month they might charge 85 cents a gallon," he said.

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