Algenol Biofuels Taking Expansion Plans Out of State

Jun 19, 2013

Algenol Biofuel's research laboratory in Estero
Credit John Davis / WGCU-FM

Citing an uncertain regulatory environment, the Fort Myers-based company Algenol Biofuels is no longer looking to expand in Florida, taking thousands of potential future jobs to another state. 

The advanced biofuel startup, which produces ethanol from algae, had been looking to develop four or five commercial scale facilities in Florida that would have employed about 2,000 people each. 

The biofuel startup’s founding President and CEO Paul Woods said he’s now looking to expand in another state.  “I wouldn’t say it’s the final decision, but it’s a decision that’s going to stand for now,” said Woods.  “

“We’ve made several attempts and several requests and we haven’t had the Governor’s Office or any of his staff actually reach out to Algenol.  Clearly, we’re about to make a $400 or $500 million decision affecting 2,000 jobs and it’s very disappointing that we haven’t heard back from them.”

The decision to look into expanding elsewhere was sparked by a bill (H.B. 4001)passed by the Florida Legislature and signed by Governor Rick Scott that repeals a state mandate requiring most gasoline to contain nearly 10 percent ethanol.  Woods says before that, a 2011 law ended up double regulating his company and shutting down their operations for about four months.

“For a business whose payroll is $3 million dollars a month, a four month, five month delay has serious economic impacts against a little company,” said Woods“In addition to that, now 2012 rolls around and they’re doing everything they can to get rid of ethanol in this state.  And so I’m not willing to make a $500 million dollar bet that they won’t do something next year in order to try and rid Florida of Algenol and ethanol and the other advanced biofuel companies that are here.”

Algenol’s research laboratory in Fort Myers was supported by a $10 million economic incentive grant from Lee County.  The stipulations on job creation for that economic incentive funding have been exceeded. 

Woods said the lab will stay in Fort Myers even if the company ends up expanding elsewhere.  He’s looking at Arizona, New Mexico and Texas as strong contenders.  “They are not constantly making legislative efforts against the biofuels companies,” said Woods.  “A number of advanced biofuel companies are in New Mexico already.  Texas several years ago considered regulating algae and then decided not to.  So really, Florida seems to be the least attractive place.”

In reaction to Wood’s decision, Governor Rick Scott’s Press Secretary Jackie Schutz wrote in an e-mail: “While we continue to support efforts that will bring energy-related innovation and jobs to Florida, the Governor does not support state-imposed mandates on specific industries.”

“We actually never asked for subsidies.  We never asked for there to be a mandate.  Our business is happy to compete on price,” said Woods.  “We don’t need mandates.  We don’t need subsidies.  What we need is regulatory certainty.  And right now we have everything but that.”

Algenol aims to be producing more than 20 billion gallons of ethanol a year within the next 20 years.