Crossroads Brings Together Groups For Ethanol Plant Feasibility Study

Crossroads, the five-county economic and tourism development organization, has launched an initiative that could result in a significant new plant being built within the region. On November 21, Crossroads hosted a conference at which a group of area farmers, merchants and economic development officials were introduced to Grant Development Services of Austin, Texas.

Together, the local group and Grant Development Services may pursue a grant to fund a feasibility study that will test the viability of building an ethanol production plant within the five-county Crossroads area: Hunt, Kaufman, Rains, Van Zandt and Wood counties. Such a plant would become a sizeable employer in the area and generate substantial tax revenue and many peripheral jobs.

The grant proposal is to be submitted to the U.S. Department of Agriculture—the study-funding source—by mid-January 2003. The local group and Grant Development Services are asking for approximately $20,000 in study funds. The study should be completed in three to four months after the grant is approved.

The market for ethanol is growing because of recent developments in California. That state has outlawed the use of MTBE (methyl tertiary butyl ether) as an additive in unleaded gasoline. Other states are expected to follow. Ethanol, a form of alcohol, is a replacement for MTBE. It boosts octane ratings while helping to extend oil reserves. Since other states are expected to follow California’s example, the market for ethanol is expected to expand dramatically in the next five to 10 years.

Ethanol is produced through a distillation process that begins with either corn or sorghum as the base ingredient. Crossroads is suggesting that the plant be developed, built and operated by the local group operating as a cooperative. Such a plant in the Crossroads area could produce between 35 million and 65 million gallons of ethanol each year, using up to 20% of grain produced in the area—a boon for local farmers. Furthermore, the distillation process produces by-products, such as sweeteners, food starch, industrial starch and produce for farm animals, which are also marketable.

“An ethanol plant of this size will create up to 40 new jobs at the plant itself,” said Crossroads President Gary McKinley, “plus another 150 or more jobs in related business in the area. It is a ‘green’ plant, which means that it is environmentally friendly. And direct and indirect tax revenue from the plant, as well as added revenue for existing businesses in the region will be substantial. This is a great opportunity for the Crossroads counties.”

The feasibility study will help determine whether the resources and infrastructure are in place to support a plant of this size. The Crossroads area boasts two major rail lines, two interstates, water sources that are critical to a plant of this type, and more than adequate produce-growing capacity.

“We think that the Crossroads counties are the perfect site for this plant,” McKinley stated. “The feasibility study will clearly spell out the advantages of the area, and we are confident that the Agriculture Department will see the value in funding the study.”

Crossroads is part of The East Texas Regional Economic Development & Tourism Group, a non-profit corporation formed in 2002 to create regional cooperation between Hunt, Kaufman, Rains, Van Zandt and Wood counties in Texas. Crossroad’s mission is to improve tourism and economic development in the member counties.