California Ethanol & Power, LLC (CE&P) announced on Aug. 1 it signed a letter agreement pursuant to which Fagen Inc. (Fagen) will act as the lead contractor for CE&P’s prospective sugarcane-to-ethanol and electricity plants in the Imperial Valley of California.

“Fagen Inc. has extensive experience in both fuel ethanol and power plants, and we are excited to have them leading the engineering, design and construction efforts for our projects,” said O. Wayne Mitchell, CE&P executive vice president, Technologies and Operations.

Fagen is currently performing initial engineering and permitting services while CE&P and Fagen are finalizing the terms of a pre-financial close technical services agreement and the post-financial close credit support engineering, procurement and construction contract. CE&P and Fagen expect to commence construction of the initial CE&P plant in approximately one year.

“Fagen is very pleased to have been selected to play such a key role in California Ethanol & Power’s strategic plan to produce the advanced biofuels favored by the federal Energy Independence and Security Act of 2007 and California’s AB 32 statute,” stated Roland (Ron) Fagen, Fagen CEO and president. “With a long commitment to renewable energy, Fagen looks forward to adding another source of green energy to the US market and supporting CE&P’s worldwide vision.”

CE&P, which is currently growing over 650 acres of more than ten varieties of sugarcane with the assistance of four internationally acclaimed sugarcane experts, has also recently achieved a number of other major milestones.

For example, CE&P is in the queue to transmit its electricity through the Imperial Irrigation District’s transmissions system, and on Aug. 6 accepted an invitation from a major California investor-owned utility to negotiate a 20-year power sales agreement.

Also, CE&P’s all-important permitting process is currently projected to be complete by the third quarter of next year. Finally, CE&P is completing arrangements with a group of five major Imperial Valley agri-businesses to grow the acres of sugarcane necessary to supply each CE&P plant.

“Our plan to “grow energy from sugarcane, the right renewable resource, in California for use in California clearly places CE&P at the right place at the right time,” explains CE&P Chief Operating Officer David R. Rubenstein.

“We will have substantially lower all-in production costs than conventional corn-to-ethanol plants, whether in the Midwest or in California, and sugarcane as the feedstock has been proven to produce much more energy per unit consumed, and to have a much better carbon footprint, than corn,” Rubenstein said. “We expect to establish our model in the Imperial Valley, and then implement it worldwide with the assistance of our strategic partners and counterparties.”