About the Company
Driven by Demand®
Pacific Ethanol is the leading producer and marketer of low-carbon renewable fuels in the Western United States. We manage and operate four ethanol production facilities located in California, Oregon and Idaho. We own an 83% interest in the four plants, which represents the single largest ownership position. The plants have a combined production capacity of 200 million gallons per year. The Columbia plant in Boardman, Oregon, the Magic Valley plant in Burley, Idaho and the Stockton plant in Stockton, California are currently operating at full capacity. The Madera, California plant is not currently operating.
Kinergy Marketing, our renewable fuel marketing subsidiary, serves customers throughout the Western United States. Kinergy has marketing agreements with six production facilities in the Western United States, including the operating plants. Kinergy also purchases and sells ethanol from many producers with facilities in the Midwest. Our feed marketing subsidiary, Pacific Ag Products, markets high quality animal feed to local dairies and feedlots located near the production facilities.
Pacific Ethanol has a differentiated business plan from the rest of the ethanol industry, which we refer to as our “destination model.” The plants are located in close proximity to our customers. As a result, the plants are able to produce and sell Wet Distillers Grain (WDG) which avoids an expensive drying process. The plants therefore consume less natural gas than most ethanol production facilities. In addition, the cost of transporting fuel and feed to our local customers is lower than for plants located in the Midwest. Ethanol produced by the plants has the lowest carbon intensity of any commercially available transportation fuel produced in the United States, according to the California Air Resource Board.
At Pacific Ethanol, we are continually working to identify, develop, and integrate other technologies at the plants for increased efficiency, lower carbon intensity, and advanced biofuel and cellulose ethanol production. We believe that our destination model, combined with our continued focus on improved performance, provides the Pacific Ethanol plants with a strategic advantage in the marketplace.
Ethanol is an integral part of the country’s transportation fuel, currently representing nearly 10% of the overall gasoline supply in the Unites States. Ethanol has many distinct advantages as a component of our transportation fuels. It is made from domestically produced renewable resources and reduces air pollution and carbon dioxide emissions that contribute to global warming. Ethanol also helps consumers by increasing domestic fuel supplies and refining capacity.
The overall demand for ethanol is expected to continue to grow. The Energy Independence and Security Act of 2007 requires an increase in the amount of ethanol and other advanced and cellulosic-based biofuels from the current demand in 2010 of 12.5 billion gallons per year to 36 billion gallons per year by 2022.