Best BioDiesel Cashton plant shuts down

Posted Aug. 11, 2010

Best BioDiesel Cashton LLC, a subsidiary of Madison, Wis.-based Best Energies Inc., shut down operations at its 8 MMgy facility in Cashton, Wis., citing the lapse of the federal blender tax credit as the determining factor behind the decision.

Best BioDiesel Cashton filed for Chapter 128 receivership in late April in Monroe County Circuit Court to Milwaukee-based law firm Beck, Chaet, Bamberger & Polsky S.C. The plant had eight employees when it closed. Production began in December 2007, but the facility hadn't produced biodiesel since the end of March. The plant, which had 20 full-time employees at the time, subsequently laid off additional workers when it approached receivership, according to Laxson Boyd, principal for Wadsworth Whitestar Consultants, a turnaround consulting firm assigned to oversee operations and market the plant for sale that was retained by BCBP.

"Essentially, we had been operating since the receivership that was filed back in late April under the assumption and certainly with the hope that the biodiesel credit would come back and, had it come back, it was the intent of the receiver and of the bank that is providing financing to the receivership to restart the facility so that we would be selling an operating biodiesel plant as opposed to an idled plant," Boyd told Biodiesel Magazine.

The plant initially used soy oil as feedstock but in 2009, Best Energies installed esterfication units for transitioning to using crude corn oil collected from various ethanol producers in the region. In 2008, Best Energies formed a partnership with Golden Grain Energy LLC, an 80 MMgy ethanol plant in Mason City, Iowa, to create a new entity called Corn Oil Bio-Solutions LLC that intended to extract corn oil from ethanol plants for biodiesel production. The extraction unit utilized proprietary technology owned by Best Energies.

Boyd said there are prospective suitors interested in taking over operations of the Cashton biodiesel facility, but a decision from a potential buyer to purchase the plant would ultimately rest on if/when the biodiesel tax credit will be reenacted.

"Frankly, I think that a lot of them are also sitting on the sidelines waiting to see what's going to happen with the tax credit," Boy said. "It's very difficult for us to move prospective buyers to being actual buyers when they're in the same position we were in, and that's waiting to see what Congress is going to do with the tax credit. We're hopeful that we'll be able to bring the plant to sale relatively quickly in the absence of the tax credit.