July 12, 2006

Railways set to play important role in ethanol industry

Ottawa, Ontario – With the announcement of funding and operating grants for new ethanol plants by the Government of Ontario, the province’s railways are taking an interest in their role in transporting the fuel and raw materials.

“I don’t know of an ethanol plant that isn’t going to be located on a railway line,” says Tom Cox, chair of the Integrated Grain Processors Co-operative. “It is absolutely critical to have railway access.”

The recent funding announcement is part of the Ontario Ethanol Growth Fund and a mandate to reduce greenhouse gas emissions by blending ethanol into gasoline. The Integrated Grain Processors Co-operative is one recipient of funding to open a plant in Aylmer, Ontario next year; Cox says it should produce about 150 million litres of ethanol a year, using about 15 million bushels of corn. The process will also produce about 130,000 tonnes of distiller’s grain, a byproduct that is used primarily as dairy cattle feed. However, the Co-operative says that the cattle feed market is becoming increasingly saturated due to the number of ethanol plants starting up in Canada and the U.S., and an alternative marketplace for the distiller’s grain, such as with poultry farms, will have to be found.

Aylmer was a strong candidate for the ethanol plant due to its St. Thomas and Eastern line services, and interchanges with CN, Canadian Pacific Railway and Norfolk Southern Railway.

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