“Long term, we want this to be a clean energy industrial park that will use biofuels, biomass, natural gas and even solar energy to generate electricity,” said Fred O’Connor, president and CEO of Biofuels.
The most important feature of the site is its access to the local power grid. It sits next to a switching station that can handle up to 500 megawatts, which means getting the power to market would be relatively easy, said OÂ’Connor.
The company would operate as an independent power producer, selling electricity onto the grid first as a “peaker,” meaning it comes on during times of peak demand when the prices are high. Eventually Biofuels Power will try to operate on a more regular basis.
“It largely depends on the cost of the feedstock for the fuels,” O’Connor said.
The company also hopes to have an on-site training center where it will teach workers how to build and operate such power plants.
Interest in fuels made from vegetable waste and animal fats has grown in recent years, thanks to the Energy Act of 2005 — which requires cleaner-burning blends of diesel — the steep climb in oil prices and growing anxiety over the nation’s dependence on foreign oil.
Biofuels officials acknowledge that such fuel sources wonÂ’t be able to eliminate the need for energy imports completely. Rather, they can provide alternatives at the margin that can have a moderating impact on fuel costs and, ultimately, electric power costs.
The University of Minnesota estimates that the country produces about 2.7 billion pounds of yellow and brown grease per year, byproducts of restaurant fry cookers and industrial processes that could be converted to about 350 million gallons of biodiesel. The 11 billion pounds of lard, tallow and poultry fats the country produces might be good for 1 billion gallons more.
But U.S. diesel consumption was about 62 billion gallons last year, according Department of Energy data, meaning even if all of those domestic animal and vegetable fuel sources were developed, the output would equal barely 2 percent of U.S. needs.
The plant site, at South Main and Hiram Clarke Road, was originally built by the cityÂ’s former electricity monopoly, Houston Lighting & Power. At its peak it generated up to 288 megawatts of power.
Those original oil-fired units were decommissioned in the mid-1980s and replaced by natural gas-fired turbines with a capacity of 78 megawatts.
The gas turbines were removed in 2004 at about the same time the Clarke plant and several others that were part of HL&P were sold to a quartet of private equity firms, which later sold the plants to NRG Energy.
Biofuels paid about $1.4 million for the land, which is sandwiched between a CenterPoint Energy training center where workers practice scaling power poles and an equipment yard for the company. Biofuels plans to spend about $500,000 for engineering and design work on the site and perhaps another $500,000 to restore the building that housed the first boilers from the 1940s.
Construction could employ up to 400 people, while it would take up to 35 workers to operate the plant and 20 to 30 more people to run the training and research center.
Chief Technology Officer Rich DeGarmo said some of the original equipment may be salvageable. During a walking tour of the site last week, he pointed out massive pipes that drew groundwater into the boilers of the four-story concrete and steel building and a rail spur that formerly connected with tracks that run along South Main.
Blueprints of the plant from the 1940s were found in a room of the plant, which DeGarmo said was also used as a backdrop for scenes for one of the Robocop movies.
Biofuels is hoping to land some federal stimulus money, an effort U.S. Rep. Al Green, D-Houston, said he will support.
If that is unsuccessful, then Biofuels, which is publicly traded in the over-the-counter markets, will finance the purchase through debt and equity.
“I’m hoping this kind of project can serve as a national example,” Green said.