N.C. pulls funding for R&D venture

Source: Amanda Peterka, E&E reporter • Posted: Wednesday, July 31, 2013

A North Carolina agency dedicated to next-generation biofuels research and development will close its doors later this year after being shut out in a state budget fight last week.

The Biofuels Center of North Carolina announced yesterday that it has begun to wind down its operations and will close completely by Oct. 31. The center, a private nonprofit, is the nation’s only state agency dedicated solely to biofuels and was working toward a goal of replacing 10 percent of the state’s liquid fuels with locally grown and produced biofuels within the next decade.

“We regret that this valuable endeavor for economic, rural, energy and agricultural gain statewide will cease,” Biofuels Center President and CEO W. Steven Burke said. “The Center, a growing biofuels community statewide, and companies considering new facilities here share dismay that North Carolina has visibly pulled back from the nation’s lead state biofuels agency and from long-term commitment to comprehensive biofuels development.”

The North Carolina General Assembly’s budget this year completely eliminated funding for the Oxford, N.C., center, which the assembly created in 2007 with an initial appropriation of $5 million. Gov. Pat McCrory (R) last week signed the budget into law, and the center’s board of directors approved a shutdown strategy at a July 23 meeting.

The plan involves closing a suite of grant programs and development projects, ending company partnerships, reporting to state agencies, and auditing the center. Unspent funding will be returned to the North Carolina Department of Commerce.

The closure comes as at least one major biofuels company, Chemtex International Inc., is eyeing the state for a second-generation facility to make fuel from Arundo donax, a feedstock that U.S. EPA approved early this month under the federal renewable fuel standard. The company last year received a $99 million loan guarantee from the Agriculture Department for the project.

Burke warned that North Carolina was at risk of losing investments to nearby states. Companies had written letters of support to the Legislature during its session and said they would not have chosen to site their facilities in the state without the support of the center.

“No longer pursuing advanced biofuels with a focused, comprehensive strategy will lessen opportunity to create rural jobs, strengthen agriculture, and create an enormous biofuels and biomaterials sector,” Burke said. “Other Southeastern states will note with pleasure that North Carolina has eliminated the center.”