The biofuels bandwagon was pretty crowded a year ago.

Alberta Ethanol and Biodiesel GP Ltd. was awaiting regulatory approval for an ethanol and biodiesel complex northeast of Innisfail, Greenlab Energy Canada Inc. had announced plans to build its own multi-faceted biodiesel facility at Stettler, and Permolex International LP was finishing a major expansion of its Red Deer ethanol plant.

Meanwhile, the Town of Rimbey was talking optimistically about an ethanol plant that would consume cellulosic materials like straw and municipal waste.

Biofuels enthusiasm has waned somewhat, thanks to high canola and grain prices, the heated food-versus-fuel debate, and skepticism about the environmental benefits of ethanol and biodiesel. Work has also yet to begin on any new plants in this region.

Bob Stroup, director of business development with Alberta Ethanol and Biodiesel, said hopes for a 2007 construction start ended when the Energy Resources Conservation Board advised in August that its approval was required after it had earlier indicated otherwise. That created a new and lengthy application process.

“We would be under construction were it not for the fact we were misdirected,” said Stroup.

Curtis Chandler, president of Dominion Energy Services LLC — one of the corporate partners behind Alberta Ethanol and Biodiesel — said the project’s estimated $400-million cost has probably gone up 10 per cent. But he insisted the integrated biorefinery, which will include a canola crush facility, is still a go.

Work will hopefully begin this year, he said, with the construction timeline for the first phase about 18 months.

“If there is one project that’s going to go ahead, it’s going to be ours.”

The price of wheat has come down, pointed out Chandler, and the cost of fossil fuels continues to rise.

As for rising food prices, he said increasing demand in China, India and other emerging economies is the big factor.

“All an ethanol plant does is take the starch or sugar out of either wheat or corn,” he said, adding that the resulting byproduct can be fed to livestock. “Animals want protein, they don’t want sugar.”

Robert Morrison, CEO of Greenlab Energy Canada Inc., was also positive about the outlook for his company’s proposed canola oil extraction and biodiesel production facility. Work on its first phase, which is budgeted at $190 million, should begin next spring, he said.

“Our engineering is completed to the point that we’re able to make application for development and environmental permits on the Canadian side.”

Because the plant will be built with prefabricated components, construction should proceed quickly, said Morrison.

“All we have to do with the land is pour a special type of slab.”

Subsequent phases will include a research campus and business park.

Morrison downplayed the biofuels component of his company’s business, describing its primary products as “vegetable oil and cattle feed.”

“Our core activity is agricultural.”

The Rimbey cellulosic ethanol plant also appears on track, with Aspen Bio-Energy Corp. emerging as the “primary investor” behind the project.

Sandip Lalli, Aspen Bio-Energy's executive vice-president, said her company was preparing to apply for provincial approval.

“We hope to be in construction later this year, assuming that their timelines aren’t excessive.”

The fact that Aspen Bio-Energy’s proposed feedstock is not in the human food chain is a “key win” for the company, said Lalli. And it will also spare it from rising farm commodity costs.

“We’re not tied into those market prices.”

Rimbey Mayor Dale Barr has described the proposed cellulosic plant as a pilot project, with similar facilities possible for elsewhere in Western Canada.

Doug MacKenzie, president and CEO of Permolex International, has concerns about the prospects for ethanol in Alberta. He said the federal government’s biofuels mandate, which will require that gasoline consist of five per cent ethanol by 2010, will allow fuel companies to blend to a higher percentage in some areas and lower percentages in others, as long as it balances out.

Some provinces have introduced their own biofuel mandates, but Alberta is not among these, he said.

“We decided to hold everything until we knew what the framework was.”

Sean Beardow, a public affairs officer with Alberta Energy, remains upbeat about the bioenergy industry.

“I see tremendous potential for bioenergy in Alberta,” he said, pointing out that provincial grants totalling $38 million as of this spring were attracting investment.

“That $38 million in grant investment has spurred an additional $850 million of private investment in the bioenergy industry in the province.”

Beardow downplayed the food-versus-fuel debate, pointing out that bioenergy feedstocks like agricultural, forestry and municipal waste are not destined for dinner plates. He added that rising food prices reflect in large part marketing, packaging and transportation costs.

Contact Harley Richards at hrichards@reddeeradvocate.com