Diamond Green Diesel Secures Loan Guarantees from DOE

Earlier this year the Department of Energy’s Secretary, Stephen Chu, “announced the offer of a conditional commitment for a $241 million loan guarantee to Diamond Green Diesel, LLC., … for an advanced biofuels plant.” As part of the loan, Diamond Green Diesel will construct a 137-million gallon per year renewable diesel facility producing the fuel from a variety of sources, including animal fats, used cooking oil and other waste grease streams. According to the DOE, the “project will nearly triple the amount of renewable diesel produced domestically and help diversify the Nation’s fuel supply.” The plant is planned for the town of Norco, Louisiana, just outside New Orleans. The location will enable the plant to take advantage of the Mississippi Delta’s oil and gas infrastructure.
The DOE states that this “will be the first application of its kind in the U.S. to use an innovative hydrotreating/isomerization process from Desmet Ballestra Group and Universal Oil Products, LLC known as Ecofining^TM which converts processed feedstock into high-quality diesel.”

Approximately two weeks later, The New York Times reported that “The Energy Department has offered a Texas company a loan guarantee for a $1 billion project to build four small factories that would turn wood chips into an oil substitute” This represents a four fold increase in original loan guarantee. According to the New Times article “Federal law provides a quota for such fuels, which are meant to reduce both oil imports and carbon dioxide emissions, but for the last two years the Environmental Protection Agency has had to cut the quotas for lack of commercial production.”

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