With economic conditions slowing project financing, cellulosic-ethanol startup Coskata‘s commercial plant might get pushed back a bit, Chief Marketing Officer and VP Wes Bolsen tells us.
The company said in January it had expected to break ground on the plant — planned to make 50 million to 100 million gallons of ethanol annually — this year and to complete the factory in late 2010 or early 2011. In February, a Coskata announcement indicated the plant was slated for late 2010. Now, the timeline will probably run more solidly into 2011, Bolsen said.
The extended timeline is not a big setback for the company, but it shows how the weak economy is adding uncertainty for even well-funded cleantech startups. “We haven’t really set the deadline,” he said. “The financial markets will dictate it [somewhat]. Our technology hasn’t slowed down, but project financing has slowed down maybe a little bit.”
The Warrenville, Ill.-based company, which claims its technology can produce cellulosic ethanol at an operating cost of less than $1 per gallon, officially announced that it had closed its third round of funding Friday. While it didn’t say how much it had raised, peHub reported that the amount was $40 million.
Last month, we reported that Coskata had just finished raising the Series C round, which had been targeted at $50 million, and also had signed an agreement with U.S. Sugar Corp. to look into building a 100-million-gallon-per-year plant in Clewiston, Fla., to convert leftover sugarcane into ethanol.
While Bolsen wouldn’t specify how much the company had raised (it never releases its fund-raising amounts or valuations, he said), he hinted that the private-equity round was larger than the size of typical venture-capital deals, which he said often range from $1 million to $20 million.
“Private equity is where the big deals, the billion-dollar deals, start happening – in those ranges,” he said, adding that the funding would be enough to get Coskata through its 40,000-per-year demonstration plant planned for Pennsylvania. “It moves Coskata into full commercialization of this technology.”
The company started building its demonstration plant in April, saying it would cost $25 million and would be located at the site of a pilot-scale gasifier owned and operated by Westinghouse Plasma Corp.
Bolsen told us Friday that the plant is now 80 percent built. He added that the company is pinning down detailed designs for its commercial factory, but is still discussing whether to build 50-million or 100-million gallons of annual capacity there. Either way, the company is pushing forward with a 50-million-gallon design and will decide to either build one or two of those plants, he said. “We want to build two [50-million gallon] plants in that location, but the question is whether the economics are better if we build one first or both at one time,” he said.
Bolsen called raising the money in the current economic environment “a small miracle” and a testament to Coskata’s technology and commercial prospects. The company also announced a partnership with General Motors Corp. earlier this year.