Poet CEO says U.S, cellulosic rule prudent

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WASHINGTON - The chief executive of Poet, the top U.S. ethanol maker, said companies are committed to producing next generation cellulosic ethanol even though the U.S. government has slashed mandates on how much of the fuel will be required to be produced this year.

The Environmental Protection Agency on Wednesday chopped the amount of cellulosic required to be blended into gasoline this year from 100 million gallons (378.5 million liters) to 6.5 million gallons.

I think some adjustments right now are prudent, Jeff Broin, the chief executive of privately-held Poet told Reuters on the sidelines of the ReTech 2010 conference.

When the renewable fuel standard was created it was a stab in the dark about how fast these facilities would come on line, he added.

I think there's still significant commitment to cellulosic biofuels long-term, Broin said. Several facilities are ready to being constructed and will be operating in the next one to two years.

Companies hope to make commercial levels of cellulosic by breaking down the tough bits of crop waste and non-food crops like switchgrass and rapidly growing trees. The EPA said on Wednesday that the fuel produces less greenhouse gas than conventional ethanol made from corn.

But the recession and tight credit markets shut many cellulosic plants and delayed many others this year.

Despite that, Broin said Poet's 25 million gallon per year Project Liberty plant is on track for being built this year. The plant will make cellulosic mostly from corn cobs and other corn crop waste and will begin production in 2011, he said.

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