Feds approve high-value fuel from Pacific Ethanol’s Stockton plant

   Sacramento-based alternative fuel producer Pacific Ethanol Inc. said it won approval from the federal government for a new, valuable renewable biofuel from its Stockton ethanol plant.
   The Stockton plant can produce 60 million gallons of ethanol a year, mostly from fermenting corn starch and sugar. This new approval from the Environmental Protection Agency will allow the same manufacturing plant to turn corn fiber into alcohol and be awarded a premium federal credit.
   The difference between feedstocks is significant. Under federal law, the newly-approved cellulosic-fiber derived ethanol allows for a premium of about $1 to $1.50 per gallon – which is on top of the fuel sale price, said Paul Koehler, spokesman with the company.
   The Stockton plant could produce more than 1 million gallons of cellulosic ethanol per year. And the technology to produce it could also be installed at the company’s eight other ethanol plants across the country.
   Pacific Ethanol (Nasdaq: PEIX) shares rose 3.1 percent in trading Monday following the news.
Cellulosic ethanol, in this case, is derived from the fiber in the corn kernel, which is broken down and digested using enzymes that convert the fiber into sugars, which then can be made into alcohol.
   Pacific Ethanol is the U.S.’s sixth-largest ethanol producer.