A second company eyeing a 206-acre site on Lancaster Highway between Chester and Interstate 77 might build a plant that produces cellulosic ethanol from waste wood, such as the debris left behind from logging. The facility would employ 60 people.

One company is considering a 330-acre Beltline Road site for a plant that would initially produce corn ethanol, but could produce what's called cellulosic ethanol, a fuel made from non-food plants. The facility could employ as many as 63 people.

CHESTER -- Ethanol, the most talked-about alternative fuel in the country, might flow in Chester County, possibly through the first two ethanol plants in the state.

But the two sites being eyed for wood- or corn-based ethanol manufacturing facilities represent more than potential jobs for a county with double-digit unemployment.

They're also part of a fledgling industry's dream for the Southeast.

"Everyone's looking at the Southeast," said Matt Hartwig, communications director for the Renewable Fuels Association, the Washington D.C.-based national trade association for the U.S. ethanol industry. "The Southeast holds a great deal of potential, not only for the production of fuel ethanol but also for the consumption."

Of the country's 127 ethanol plants, only one is in the Southeast -- in Tennessee. However, 81 more are under construction nationally, including sites in Georgia and Mississippi.

Ethanol projects are being discussed in South Carolina, including the two in Chester County. Depending on how quickly a plant breaks ground, the county could claim the first ethanol plant in the state.

Ethanol boom

The U.S. ethanol industry exploded in recent years. In 2000, the country produced 1,630 million gallons of ethanol, according to the Renewable Fuels Association. Last year, that number was 4,855 million gallons.

The national interest isn't just in corn ethanol, though, but also in cellulosic ethanol, which is made from plants not used for food.

The U.S. Department of Energy said in February that it would invest up to $385 million in six bio-refineries over four years. The DOE expected the facilities to eventually produce more than 130 million gallons of cellulosic ethanol per year.

Ethanol's future

One of the ethanol companies eyeing Chester County wants to build a plant that produces cellulosic ethanol from waste wood, such as the debris left behind from logging. The other company is planning what would initially be a corn-based operation.

County officials have not identified either company.

Experts see the Southeast as a viable producer of either corn or cellulosic ethanol. Corn-based plants, however, are closer to reality, even though the region doesn't produce much corn.

The ethanol industry is struggling with whether to ship corn or ethanol a long distance, said Chad Hart, an agricultural economist at Iowa State University's Center for Agricultural and Rural Development. "If you're trying to tap into the Atlanta ethanol market, it might make sense to have a plant in Georgia, in South Carolina, that can ship a couple of hundred miles away to Atlanta rather than a thousand miles away from Iowa."

Some wonder how viable a corn ethanol plant will be in South Carolina, which produces half the corn needed to support the proposed Chester County plant.

"If they were producing ethanol from, say, wood byproduct ... it would make sense to me. But not so much corn here," said Marsha Bollinger, a Winthrop University geology professor. "I guess I would be questioning the future of the plant -- not whether you can do it now -- but will it be viable 10 years from now."

Clint Thompson, whose Georgia consulting firm is working with the company that wants to build the corn ethanol plant, said an ethanol plant can be successful without a large regional corn crop.

"The reality is destination plants work," he said. "We have the market. We have what the Midwest guys don't. We have people that drive cars. So, a guy that's sitting in Iowa, South Dakota, Minnesota, he's going to pay 20 cents a gallon to move his ethanol to where the people are... We'll pay less than a nickel."

Corn-based ethanol currently dominates the U.S. ethanol market. But last month, a Colorado-based ethanol company announced it had received a permit to build the country's first commercial-scale cellulosic ethanol plant in Georgia.

Still, some doubt that fuel technology is commercially viable.

"There are trial plants for cellulosic ethanol in the U.S., but it is not profitable," said Simla Tokgoz, an international grain and ethanol analyst with the Food and Agricultural Policy Research Institute at Iowa State. "It cannot compete on a profitable basis with corn ethanol right now. The technology is still improving."

Chester County Economic Development Director Karlisa Parker said the business planning a wood-based ethanol plant has vast experience with cellulosic ethanol technology. The business planning the corn-ethanol plant will ship corn from the Midwest and could add cellulosic ethanol if technology changes.

'Our first generation bio-fuel'

Ethanol proponents say the fuel burns cleaner and costs less than regular gasoline, and using ethanol supports local economies because area manufacturers easily can produce the materials to make it.

Most importantly, they say, ethanol reduces Americans' dependence on foreign oil.

Ethanol critics claim the corn used to produce the fuel requires fertilizer and pesticides that pollute rivers and streams. They point to coal-powered ethanol plants in the Midwest that hurt air quality and the millions of gallons of water drained from water supplies to make ethanol.

Critics also say the plants produce an unpleasant smell.

Because the ethanol industry is still in its infancy, the validity of some concerns is still being debated.

"Ethanol sort of represents what I call our first generation bio-fuel," Hart said. "Is ethanol the end-all of bio-fuel? Arguably, it's not. But when we look at what it costs to create fuels from plants today, right now ethanol is the most cost effective way to do that."

What to expect in Chester

So what impact will these plants have on Chester County?

The plants could bring 123 jobs and millions in local investment. Environmentally, Hart said ethanol plants put additional strain on the water supply and roads.

But county leaders say those issues won't be a problem.

An ethanol plant would actually help the community's water quality by allowing the water plant to run more frequently, said Mike Medlin, executive director of the Chester Metropolitan District, which provides water for much of Chester County.

Over the last 10 years, the county has lost industry and water customers. The county's water plant can handle 7.2 million gallons per day, but now only 2.5 million gallons are used daily. The corn-based ethanol plant could use 1.2 million gallons per day.

Increased truck traffic has been a concern of residents living near other ethanol plants, including the Albert City, Iowa, facility some Chester County leaders and landowners recently visited.

But Chester officials say the traffic shouldn't cause a problem here because other companies recently have closed or scaled back operations.

The Chester County corn plant would include features that are more environmentally friendly than some other ethanol plants, Hart said.

Instead of coal, the plant would be powered by natural gas. Also, a liquid carbon dioxide or "dry ice" plant would capture carbon dioxide emissions, helping air quality.

In Albert City, residents initially worried about the smell of the plant and the truck traffic, city clerk Angie Nielson said. But she hasn't heard any complaints since the plant started in December.

"They've been really good working with us," she said.

Alvira Braesch, an Albert City resident who lives less than half a mile from the plant, said she's never had problems with the facility, which she can see from her house. While she's never noticed an odor from the plant, others say it often smells like fresh baked bread.

"It doesn't bother me a speck," said Braesch, who moved to her home in 1986. "Outside of the traffic, I don't know it's any different."

• You're probably most familiar with it as ethyl alcohol, drinking alcohol or grain alcohol. Yes, that's ethanol.

• Ethanol also is a biofuel alternative to gasoline that can be made from corn, wood chips and other renewable products. Starches break down into sugars that can be fermented and distilled into ethanol. In the U.S., its primary feedstock is corn.

• Flex-fuel vehicles are cars and trucks that can run on either gasoline or E85 ethanol. What's E85? That's a blend of 85 percent ethanol and 15 percent gasoline. You can buy it locally. Henry Ford's Model T ran on a version of ethanol.

• Ethanol burns cleaner than regular gas and using ethanol-based fuels supports local economies because area manufacturers can easily produce corn and other products used for the production of ethanol. One company eyeing Chester County for an ethanol plant has said it will buy all the local corn it can.

• If Chester County lands one or both ethanol plants being considered for the area, the facilities would be the first of their kind in the state. Ethanol manufacturing plants are being considered for other places in South Carolina, but no ground has been broken anywhere. Industry analysts say the Southeast is being targeted for ethanol plants, in part, because of the region's market for the alternative fuel. Of the country's 127 ethanol production facilities, only one is in the Southeast (Tennessee). However, 81 more are under construction, including sites in Georgia and Mississippi.

6C • Graphic on how ethanol is made from corn