The Governor of New York, George E. Pataki, has announced nearly $6 million in State funding to assist Western New York Energy (WNYE) in the development of the first state-of-the-art dry mill ethanol plant in New York State. The $87.4 million facility is to be located on 144 acres in the Town of Shelby, Orleans County.

“Western New York Energy’s new facility in the Town of Shelby will help us take advantage of this opportunity to reduce our dependence on unstable foreign energy supplies,” Governor Pataki said. “The new facility is expected to produce 50 million gallons of ethanol a year and create 58 new jobs and represents another significant step in our goal of developing a strong biofuel industry in the State which will not only provide an economic boost to our farming community, but keep our energy dollars here in New York.”

The WNYE plant, construction of which is scheduled to start this summer, is expected to produce a minimum of 50 million gallons of fuel-grade ethanol, 250,000 tons of distillers grains, and 95,000 tons of carbon dioxide, annually. The plant is expected to begin production in January 2008.

It will purchase an estimated 6 million bushels of corn each year, benefiting upstate corn farmers. Ethanol produced at the WNYE plant will be shipped by rail and truck to New York, New Jersey, Connecticut and other Northeast markets.

Chief Executive Officer of Western New York Energy LLC., John Sawyer said, “The Shelby location has been selected due to its proximity to the New York and Connecticut ethanol markets, the nearby western New York dairies, outstanding rail-transportation links and the excellent economic climate provided by Orleans County, the Town of Shelby, the Village of Medina, and the Town of Ridgeway. Likewise, the area includes a terrific pool of qualified, skilled employees and construction workers.”

John Lincoln, President, New York Farm Bureau, said, “There is no doubt that biofuels production will have a significant and beneficial impact upon the agricultural industry in New YorkState. Western New York Energy will provide an expanded corn market for farmers and exciting opportunities for the growth of new commodities for ethanol production, while at the same time returning the co-product -- dried distillers grains -- to our dairy industry as a feed supplement. We are tremendously excited by the prospect of working with Western New York Energy for years to come.”

State support for the project is being provided through a number of programs including approximately $3.1 million in Multi-Modal funding to support the acquisition of rail car loading equipment and the construction of a rail siding, including associated land clearing and grading. Also, the Orleans County Industrial Development Agency is eligible to apply to the State Department of Transportation for up to $435,000 in a combination grant and low-interest loan through the Industrial Access Program.

This year's Budget includes a Renewable Fuel Production Tax Credit that makes New York companies eligible to receive a tax credit for each gallon of renewable fuel they produce. This initiative, which is part of the Governor's energy independence plan, provides up to $2.5 million in tax savings per year, per facility.

Additional support for the project was made available by Senator George Maziarz who has made available $2.5 million in economic development funding to support the project.

The State Multi-Modal Transportation Program provides reimbursements for authorized rail, port, airport, local highway and bridge projects. Eligible projects must be for a public or freight transportation purpose and have a minimum 10-year bondable service life.

The Industrial Access Program, administered by the New York State Department of Transportation, provides a combination of grants and interest-free loans on a 60/40 percentage split to municipalities or associations sponsored by municipalities for transportation access projects that promote economic development, encourage investment and help create and maintain jobs.

State Agriculture Commissioner Patrick H. Brennan said, “Today is a great day as we celebrate another investment in ethanol production in New York State. While ethanol production can help reduce our dependence on imported oil and reduce harmful emissions, I am most excited about the potential for ethanol production to provide new markets for our farmers and opportunities for rural economic development. This investment will create jobs and spending in Western New York, and I appreciate the commitment of all the partners involved to make this investment possible. I also appreciate the assistance of Congressman Reynolds and Governor Pataki, whose progressive alternative energy policies are leading the nation.”

In addition to ethanol, the facility will produce two byproducts that will be marketed for sale: carbon dioxide, which is used for beverage carbonation and freeze drying, and distiller’s dried grains, a high-protein livestock feed that is well-suited for New York’s dairy industry.