The U.S. Department of Energy (DOE) last week finalized a $132.4 million loan guarantee to Abengoa Bioenergy to support the development of a commercial-scale cellulosic ethanol plant at Hugoton in southwestern Kansas.

The announcement came just days after DOE reported that it had finalized a $105 million guarantee for Poet's planned cellulosic ethanol plant in Emmetsburg, IA.

"Investing in a domestic advanced biofuels industry will help us compete in a growing, global clean-energy economy while creating jobs in rural communities across the country," said Energy Secretary Steven Chu. "At the same time, these investments will help us reduce carbon emissions and decrease our dependence on oil."

The Abengoa project is expected to convert approximately 300,000 tons of crop residues, including corn stover, into 23 million gallons of ethanol per year using an enzymatic hydrolysis process. The facility will be self sufficient, using unconverted biomass to generate 20 megawatts of electricity to power the ethanol plant.

The project will fund about 300 construction jobs and 65 permanent jobs. Abengoa recently announced that construction has already begun, and that the total investment will exceed $350 million.