A new ethanol plant in Aylmer, Ontario will boost the region's economy, say investors in the project. But some question the environmental impact of increasing production of the fuel, which is an energy-demanding process.
A 48-acre plot in Aylmer's Business Park in southern Ontario is the chosen site for an $87 million corn-fed ethanol plant that will have an annual production capacity of 150 million liters.
On July 31,the Integrated Grain Processors Co-operative, the group of corn producers behind the project, opened the doors to its Aylmer office. IGPC plans to start constructing its plant in a few months once approvals have been finalized, says the group's chair Tom Cox.
IGPC received $11.9 million in funding for the project in 2005 under the federal Ethanol Expansion Program, part of the Liberal government's climate change program.
Southern Ontario farmers and community members raised another $25 million and $14 million came by way of a capital grant from a provincial government fund dedicated to increasing ethanol fuel production in Ontario.
Municipal officials and business people are optimistic about economic growth they believe will follow the plan.
"People will especially benefit from the job opportunities created by the ethanol plant after the Imperial Leaf Tobacco's plant shut down," says Cox.
Construction of the plant is expected to create about 150 jobs and the plant itself will employ 30-40 people with high school education in biological processes and engineering.
The added demand for corn is expected to help Ontario's corn market, and these benefits could spill over into other local industries.
"The IGPC estimates that it would annually generate over $200 million direct and indirect economic activity in Elgin and surrounding areas," says Cox, citing studies of similar facilities in the United States.
IGPC is one of five companies receiving funding in the second round of the Ethanol Expansion Program. The program is an important part of Canada's effort to have 35 percent of gasoline contain 10 percent ethanol by 2010, says Natural Resources Canada.
Canada committed to reducing its emission of greenhouse gases to six percent 1990 levels when it signed onto the Kyoto accord in 1997. Expanding ethanol use was part of the climate change plan the federal government released in 2002 to meet this goal.
Interest in ethanol has been increasing because it is viewed as an environmentally friendly alternative to fossil fuels. Ethanol is a renewable resource produced by fermenting feedstock such as corn or wheat. It helps with more complete combustion and has been blended with gasoline to reduce the amount of harmful carbon monoxide emissions from vehicle tailpipes.
Ten percent ethanol-blended gasoline (E-10) is now available at more than 1000 service stations across Canada. It may be used in any vehicle manufactured in 1980 or later, according to NRC.
However, some energy balance studies have found ethanol might take more energy to produce than the energy it offers, raising questions as to whether expanding ethanol plants in Canada is worthwhile.
Researchers have also found that more energy is required to produce ethanol than gasoline. So, the benefit of lower greenhouse gas emissions during ethanol combustion is offset by greater emissions during the production process.
"Ethanol may produce more greenhouse gases than gasoline alone," concluded Jeremy Brown, a policy analyst at the Fraser Institute and manager of the Canadian Statistics Assessment Service.
Another concern is that ethanol contains less energy than gasoline. Researchers say it could cost about $250 more per year to run a pick up truck on ethanol than on gasoline. The U.S. Department of Energy says a vehicle must use 1.4 times as much E85, fuel blended with 85 percent ethanol, as gasoline to go the same distance.
Cox responds to the criticisms saying that more advanced technologies are now being used in corn production. He says the energy needed to produce ethanol is declining as a result.
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