Louisiana To Develop A $700M Renewable Diesel Plant

Governor Edwards announced plans for a $700 million renewable diesel refinery in Caldwell Parish this past week. He, along with CEO Paul Schubert of Strategic Biofuels LLC, made an announcement that the company’s wholly-owned subsidiary, Louisiana Green Fuels, will develop the plant near Columbia, LA. The plant will be on a 171-acre site at the Port of Columbia and produce up to 32 million gallons of renewable fuels annually.

Louisiana Green Fuels will do this through established refinery processes with wood waste as the feedstock. It’s completing feasibility and financing phases for the project with the anticipation of a final investment decision by late 2022.

Today's announcement of Louisiana Green Fuels' plans to develop a renewable diesel plant in Caldwell Parish shows how our state can merge traditional and emerging forms of energy in exciting ways to address climate change. Read about it here: https://t.co/MyNxMUyh6E #lagov pic.twitter.com/TnralXpYNs

— Gov. John Bel Edwards (@LouisianaGov) April 23, 2021

Louisiana Green Fuels will make a capital investment of at least $700 million through the project. Along with the cash, 76 new direct jobs will be created. These jobs will have an annual salary of over $68,000 along with benefits. Louisiana Economic Development (LED) estimated that the project will result in an additional 412 new indirect jobs — totaling almost 500 new jobs in Caldwell Parish. The building phase is planned to take at least 30 months and will generate another 450 construction jobs.

“Louisiana Green Fuels is an example of how our state can merge traditional and emerging forms of energy in exciting ways to address climate change,” said Governor Edwards. “The company has engaged Justiss Oil of Jena to drill a sequestration test well that will confirm the integrity of carbon storage a mile below the earth’s surface. This project would boost our state’s forestry sector by harvesting timber byproducts in a sustainable fashion, and the refinery’s renewable diesel output would be accomplished in a carbon-negative fashion. That means this refinery would achieve better than net-zero emissions – it would actually remove more carbon from the environment than it produces.”

So far, Strategic Biofuels has raised 85% of its early-stage financing from investors in North Louisiana. Along with the Columbia renewable diesel refinery, the company is planning to develop other refineries that will produce renewable aviation fuel along with diesel.

“Caldwell Parish is the ideal location for our Louisiana Green Fuels plant,” said Dr. Schubert, CEO of Strategic Biofuels. “It combines the required forestry waste feedstock for fuel production and the right geology for carbon sequestration within the State of Louisiana’s visionary legislative framework, which has been further strengthened by the Climate Initiative established by Governor Edwards. We are especially thankful for his signature on the recent $200 million tax-free bond allocation, which substantially advances the financing for this project.”

LED started the formal discussions with Strategic Biofuels about the project back in July 2020. The State of Louisiana plans to negotiate a competitive incentive package to secure the project once a final investment decision is made. Following that decision, the construction of the initial Louisiana Green Fuels refinery is slated to start at the Port of Columbia and lead into initial plant operations in early to mid-2025.

What Exactly Is Renewable Diesel?

The U.S. Energy Information Administration defines renewable diesel as biomass-based diesel fuel. It’s sometimes called green diesel and is chemically the same as petroleum diesel fuel and can be used in place of petroleum-based diesel. It’s usually produced from cellulosic biomass materials such as crop residues, wood, and sawdust.

Allen Schaeffer, executive director of the Diesel Technology Forum, spoke more about it in an article for Government Fleets. “Renewable diesel, much like biodiesel, is derived from waste agricultural products, particularly waste vegetable oils and waste animal fats,” he said. “As long as we grow soybeans and produce livestock, the waste-derived after these products have been processed into food can be refined into a clean, low-carbon fuel.”

He also noted that the biofuel helps reduce carbon emissions and petroleum use while improving air quality (compared to conventional diesel fuel).

That article also pointed out that the City of Oakland, California, has been using renewable diesel in all of its diesel-powered equipment — including fire department apparatuses and off-road equipment — since 2015. Richard Battersby, manager of equipment services for the city, pointed out that he expected over 1,500 tons of greenhouse gas emissions were eliminated every year.

“We expect to displace the consumption of about 250,000 gallons of petroleum diesel and eliminate more than 1,500 tons of greenhouse gas emissions each year, and we have yet to encounter any drawbacks,” Battersby said. “The most common reaction I’ve experienced is disbelief that there is a cleaner-burning direct diesel fuel substitute that is made from renewable sources, doesn’t require any additional expense for the fuel itself, and does not require equipment and infrastructure modifications.”

It’s good to see Louisiana focusing more on cleaner fuels. However, living in Cancer Alley has me pretty skeptical. Refineries pollute the air, and after learning about the Formosa plant being built and other plants, I am leery of the “too good to be true” things.

Personally, it’s a great thing that this type of fuel has been invented if burning it improves air quality compared to burning petroleum and cuts emissions. I’m all for that.

Featured image courtesy of Governor John Bel Edwards