Fulcrum BioEnergy Secures Funding for Renewable Energy Project

Fulcrum BioEnergy Secures Funding for Renewable Energy Project

California firm receives $175 million in commitments to commercialize its solid-waste-to-renewable-fuels project.

December 4, 2012
REW Staff

Fulcrum BioEnergy Inc., based in Pleasanton, Calif., reports that it has successfully secured commitments and is proceeding toward closing on financings totaling $175 million to fund construction of the company’s Sierra BioFuels Plant, the company’s first municipal solid waste (MSW) to low-carbon fuels plant. In addition to funding the Sierra facility, Fulcrum says the financing will be used to develop future projects.

E. James Macias, Fulcrum president and CEO, says, “With our recent success in securing attractive sources of capital, we are proceeding with our planned development program. The current IPO market environment remains challenging, especially for development stage companies like Fulcrum. Because of this we have secured commitments from alternative capital resources to advance our MSW to renewable fuel program, and we have withdrawn our registration statement. We intend to pursue an initial public offering in the future when market conditions are more favorable.”

According to a Fulcrum news release, its engineering and technology teams recently made enhancements to its MSW-to-ethanol process. The adjustments, the company adds, will reduce its cost to produce renewable fuel to less than $0.75 per gallon, down from about $1.25 per gallon as previously disclosed. The cost of production at future Fulcrum plants is now expected to be less than $0.50 per gallon, down from $0.70 per gallon as previously disclosed.

“These enhancements underscore our confidence in the attractive economics of our business model, while further advancing Fulcrum as the industry’s low-cost producer of low-carbon transportation fuels,” says Macias.

In August 2012, the U.S. Department of Agriculture awarded Fulcrum’s Sierra BioFuels Plant a conditional commitment for a $105 million loan guarantee. With the loan guarantee finalized, the company will secure bank financing, which when combined with private equity capital provided by Fulcrum, will fully fund construction of the municipal solid waste to renewable transportation fuel facility.