LANSING - Mascoma Corporation is receiving $26.0 million in funding from the U.S. Department of Energy (DOE) and $23.5 million from the state of Michigan, which will allow Mascoma to accelerate construction of a cellulosic fuel facility in Kinross, in the Upper Peninsula's Chippewa County, and scale up its technology process while also paving the pathway to commercial cellulosic fuels production in Michigan.

The announcement was made today by the DOE in Washington D.C. and was followed by a joint press avail in Lansing with company officials, Governor Jennifer M. Granholm, members of the Michigan congressional delegation, and the Michigan Economic Development Corporation (MEDC).

"Michigan is proud to partner with Mascoma as part of our commitment to lead the nation in alternative energy production," said Granholm.  "This company and their partners will create jobs in Michigan as they develop the next generation of cellulosic ethanol that will reduce our dependence on foreign oil and make fuel more affordable for our families."

"Mascoma is pleased and honored to receive this funding from the state of Michigan along with the matching grant from the DOE," said Bruce A. Jamerson, chairman and CEO of Mascoma Corporation.  "This funding will allow us to accelerate commercial production of low carbon fuel that will not only reduce greenhouse gas emissions and promote energy independence but also will stimulate the Michigan economy and provide leading-edge jobs." 

Mascoma chose Michigan for its first commercial-scale facility based on the vast sustainable forests and agricultural materials available and the expertise provided by JM Longyear.  In addition, Mascoma will collaborate with Michigan State University and Michigan Technological University to develop and hone scientific processes that utilize Michigan feedstocks for cellulosic ethanol production.

"We've targeted industries like alternative energy to diversify Michigan's economy and create new jobs," MEDC president and CEO James C. Epolito said.  "Innovative tools combined with effective partnerships are enabling us to attract high-tech companies like Mascoma and accelerate Michigan's transformation."

Drawing on Michigan's substantial natural resources, the facility will use sustainably harvested mixed hardwood chips and other non-food biomass materials as the raw material for the production of ethanol.  The first phase of the project will define preliminary engineering designs and permitting required to initiate construction at the Kinross site.  Mascoma's cellulosic fuel facility is expected to produce 40 million gallons of ethanol and other valuable fuel products per year.  The project is estimated to cost over $250 million to complete and will be funded by a combination of grants, equity capital and debt. General Motors and Marathon Oil, which are both investors in Mascoma, are providing funding and support for this project.

Today's announcement brought widespread support from government and business leaders.  Here is what they had to say:

"I applaud the decision by the Department of Energy and the state of Michigan to provide the incentives Mascoma needed to scale up the technology and accelerate construction of this facility here in Michigan," said Senator Carl Levin.  "This investment in cutting-edge biofuel technology will create jobs in Michigan, and the incredible natural resources of the Upper Peninsula will help Mascoma to efficiently produce the next generation of fuels."

"Mascoma Corporation's cellulosic fuel facility is a prime example of how Michigan continues to lead the way in solving our nation's energy crisis while creating new jobs in a green economy," said Senator Debbie Stabenow.  "I am pleased to work with the rest of the delegation and the state of Michigan to support Mascoma in their mission to develop low-carbon biofuels and reduce our dependence on foreign oil."

"Mascoma and the Department of Energy recognize the potential northern Michigan and our workforce hold for developing alternative energy sources," Congressman Bart Stupak said.  "Mascoma's proposed cellulosic fuels facility will be the first of its kind in the nation to produce ethanol from timber.  This important federal-state-private partnership will put northern Michigan on the forefront of this developing technology, create hundreds of jobs in our community and the potential for many more.  I am pleased to have played a role in helping to bring this significant investment to Chippewa County."

"This technology holds enormous promise for making a huge impact upon our national efforts to become more energy independent", said Michigan Technological University President Glenn Mroz. "Michigan Tech is ready and pleased to contribute to the necessary support for the success of this project and the development of this industry in the state."

"In Michigan, our research and development emphasis is on making renewable fuels from cellulose - trees, stems and stalks that are not food products," said Michigan State University President Lou Anna K. Simon. "Our state has a plentiful supply of forest biomass, particularly in the U.P.  Michigan State is pleased to contribute its extensive expertise in bioeconomy research in order to help the state become a leader in cellulosic ethanol operations."

"The announcement today moves Michigan into the forefront of next generation energy production," said State Senator Jason Allen (R-Traverse City).  "This will further help America to become energy independent."

"I have always said that Michigan has the potential to become a powerhouse in renewable energy production, and Mascoma's decision to invest in the Upper Peninsula will turn that potential into real results, said State Representative Gary McDowell (D-Rudyard).  "Mascoma's cellulosic ethanol plant will create good-paying jobs for our workers, help reduce our dependence on foreign oil and produce clean, affordable energy.  This is a very exciting announcement for our community and our state."

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