Aemetis has taken a major step toward dramatically cutting energy costs and boosting profitability at its California ethanol facility.

 

The company has received critical equipment for a $40 million mechanical vapor recompression (MVR) system that is expected to slash natural gas consumption by approximately 80%.

 

The renewable natural gas and biofuels company announced the arrival of high-efficiency turbofans and other key components for the project at its 65-million-gallon-per-year ethanol plant in Keyes, California. 

 

Once fully operational, the MVR system is projected to generate an additional $32 million in annual operating cash flow while lowering the carbon intensity of the plant’s ethanol production.

 

The installation is expected to strengthen Aemetis’ position in the low-carbon fuels market by increasing the generation of California Low Carbon Fuel Standard credits and enhancing the value of transferable Section 45Z Clean Fuel Production tax credits.

 

“MVR technology is being adopted in the ethanol industry for energy savings and economic incentives associated with lower emission rates, and Aemetis is among the first producers in North America to install the system,” said Eric McAfee, Chairman and CEO of Aemetis. 

 

“As we invest in producing lower-cost fuels, we are expanding operational efficiencies that reduce costs and increase revenues.”

 

The project centers on six 3,500-horsepower electric turbofans designed to recycle heat from alcohol vapors to generate steam, significantly reducing the plant’s reliance on natural gas. Construction is underway, with the system expected to be operational by the end of 2026.

 

The project has already secured approximately $19.7 million in grants and tax incentives from the California Energy Commission, Pacific Gas & Electric, and the U.S. Internal Revenue Service through Section 48C investment tax credits.

 

Operating since 2011, the Keyes facility produces 65 million gallons of ethanol annually and supplies roughly 2 million pounds of animal feed each day to about 80 dairies across California’s Central Valley. The plant also captures more than 100,000 tons of carbon dioxide annually for reuse in food production and other commercial applications.

 

The MVR upgrade represents one of Aemetis’ largest efficiency investments to date as the company expands its portfolio of renewable fuels, biogas, sustainable aviation fuel, and carbon reduction projects aimed at lowering emissions while improving long-term financial performance.