KEYES — The ethanol plant next to Highway 99 will experiment with making the fuel from sources other than corn, which has gotten pricey.
Aemetis Inc., which operates the plant, has reached an agreement to test a process developed by Edeniq Inc. of Visalia.
The move could help ease concerns among dairy and poultry producers, who say demand from ethanol plants has driven up the cost of feed corn.
The new process enables the plant to use waste from sweet potato processing, cotton gins and other noncorn sources, Andy Foster, executive vice president at Aemetis, said Monday.
"It's a real variety of feedstocks -- agricultural residues that are available to us in the Central Valley," he said.
The company will replace up to 20 percent of its corn with the alternatives, he said.
Aemetis, previously known as AE Biofuels, is based in Cupertino in Santa Clara County. The Keyes plant employs about 50 people and each year can produce about 60 million gallons of ethanol, which is blended with gasoline at another location.
The $130 million plant was opened by a different company in late 2008 but shut down after four months because of market and technical issues. The current operator reopened it under a lease in April 2011, planning from the start to try corn alternatives.
The corn is shipped from the Midwest, carried by railroads that also supply this feed to the valley's dairy and poultry industries. Concerns about ethanol's effect on feed corn prices has prompted research into alternatives.
Edeniq developed a process that mills corn and other feedstocks into "right-sized" particles for ethanol production, a news release said. The details are a trade secret.
Both companies are using grants from the California Energy Commission to promote noncorn ethanol -- $3.9 million to Edeniq and $1.8 million to Aemetis.
Bounty of ag resources
Foster said his company hopes to get the alternative material from about a 50-mile radius, which takes in the extensive sweet potato and cotton acreage in Merced County.
The plan could include corn stover -- the parts of valley-grown corn plants that are not fed to livestock.
"One of the benefits of having a location in the Central Valley of California is that we can help our customers take advantage of the agricultural resources this area provides," says Brian Thome, president and chief executive officer at Edeniq, in the release.
The Keyes plant, the only ethanol producer in Stanislaus County, is part of a U.S. industry that is expected to turn out about 12.6 billion gallons this year.
Backers say the fuel is an affordable, environmentally sound alternative to oil.
Detractors question whether the nation should shift so much of a major food source into energy production.
Foster said the advanced technology will help the Keyes plant weather the challenges in the ethanol industry.
Some plants have shut down this year because of reduced fuel consumption, sugar-based ethanol imports from Brazil and shrinking margins brought on by high corn prices.
Modesto Bee staff writer John Holland can be reached at email@example.com or (209) 578-2385.