ICC clients receive New Energy Ventures funds
Clients served by the Eastern Region Innovation and Commercialization Center, based at Eastern Kentucky University, are among those at the forefront of Kentucky’s efforts to become a national leader in energy technology and production.At a news conference March 1 at The Center for Rural Development in Somerset, Gov. Steven Beshear announced that two Eastern Region ICC clients were awarded a combined $530,000 in funding from the Kentucky New Energy Ventures (KNEV) Fund, which provides public funds to promising, early-stage Kentucky companies developing and commercializing alternative fuels and renewable energy technologies.
Wellhead Energy Systems, in Somerset, was approved for a matching grant of $500,000 to develop generator systems that can be placed near natural gas wells to produce electricity for rural communities. Southeast Biofuels, in Mt. Sterling, was approved for a matching grant of $30,000 to develop a portable system that can produce ethanol using sorghum as a feedstock.
“The Eastern Region ICC has been extremely well represented in the growing alternative energy cluster,” said Gary Marshall, executive director of the Eastern Region ICC, whose office is located in EKU’s Business and Technology Center.
To date, the KNEV Fund has presented 25 awards for a total of $2.85 million. The fund is managed by the Kentucky Cabinet for Economic Development, through its Department of Commercialization and Innovation, and is administered under contract to DCI by the Kentucky Science and Technology Corporation. Most of the recipients are located in rural Kentucky communities and are developing renewable energy technologies based on clean coal, solar, wind or biofuel.
“Nine of the 25 awards that have been made from the KNEV fund have been made to Eastern Region clients,” Marshall noted, “and on a dollar basis, 42 percent of the awards have gone to our region (one of six ICC regions in the Commonwealth).
“We in southeast Kentucky are especially pleased to see that KNEV funds are being invested in the region. Our 46-county area is not blessed with a research university, but is blessed with natural resources, including natural gas, timber and an agrarian base. We are steeped in energy-related businesses, culture and work ethic, and we believe these investments are just the beginning to a prosperous alternative energy industry future.”
Wellhead Energy Systems (WES) began in 2009 with a vision of using “stranded” natural resources that lack access to transport pipelines to create a distributed energy model in Kentucky.
“Over 40 percent of our nation’s natural gas supplies are considered stranded,” Weddle said, “which means no access to use or to transportation pipelines, and Kentucky is no exception. Kentucky’s Department of Oil and Gas has identified thousands of stranded natural gas wells, and Wellhead Energy is working to put those valuable assets to work.”
After cleaning and compressing it, WES will feed the gas into self-contained generator systems adjacent to stranded assets. From there, WES will be able to convert the stranded gas into electricity, making it available to utilities, rural areas and industrial locations. “By placing the generators closer to electrical users, our company plans to create a distributed energy supply to provide secure and reliable electrical power to rural communities.”
The firm has accepted an equity investment and partnership from Enerfab, a large construction and maintenance company that “sees the strategic value of WES in its business future,” Weddle said.
WES also has created an alliance with Sharpe Houseboats of Somerset to manufacture the energy conversion systems. “By working with Sharpe, WES plans to assist in keeping high-tech jobs located in the Somerset area. Crossover training will allow Sharpe to keep people employed, as well as provide new opportunities for skilled labor in the near future.”
WES plans to have a demonstration Gridbox energy conversion station system operating in May 2010, with system sales to follow. “This may be the quickest-to-market investment story to date,” Marshall said, “and testifies to the value and benefit the KNEV funding provides Kentucky companies.”
Weddle said Marshall and the Eastern Region ICC were “instrumental in guiding us through the pathway of KNEV and KSTC. Gary also had our business model vetted by other venture funding sources to make sure we had the best strategy going forward. As our sponsor for this award, Gary has continued to provide us with more options for funding in regards to training and personnel resources.”
Southeast Biofuels’ modular fermentation system will produce liquid fuel at sites where sorghum feed stock is grown and harvested. Sweet sorghum grows well in Kentucky, even on marginal lands, and the stalks and leaves can be processed in ways similar to sugar cane, with juice pressed out so it can be fermented into ethanol.
“We plan to initially focus on expanding existing sorghum crops, and then later extending our production onto marginal lands,” said Stephen Popyach, president of Southeast. “Our crops will help keep money within the Kentucky economy that is currently flowing out to pay for petroleum fuels. We’ll also help existing farms earn an income by paying to use their land to grow our crops.”
Another ICC client and past fund recipient, Highland Biofuels, was represented at the news conference by Jeff Cooper, co-owner, who highlighted the firm’s timber-biomass wood-pellet business, which will leverage forestry resources in the region surrounding Olive Hill in northeast Kentucky. The business will also retrofit and upgrade an idled brick manufacturing facility, bringing high-tech jobs to the area.
The Innovation and Commercialization Center acts as a comprehensive business accelerator focused on helping Kentucky entrepreneurs develop and mature their ideas and business concepts, perfect their business strategies and build successful high-performance businesses. ICC staff members work with clients to craft custom work plans for meeting goals and achieving the desired result – a high-growth organization that is venture ready.
In addition to the ICC office on EKU’s Richmond campus, the Eastern Region also includes offices in Ashland, in partnership with Ashland Community and Technical College, and in West Liberty and Paintsville, in partnership with Morehead State University.
Housed in EKU’s Center for Economic Development, Entrepreneurship and Technology (CEDET), The Eastern Region ICC is currently serving approximately 120 clients throughout its 46-county area. Approximately 20 of the clients are energy-related.
EKU is also home to The Center for Renewable and Alternative Fuel Technologies (CRAFT), which was established in 2008 to research the feasibility of using algae to transform cellulosic material into biodiesel, an initiative that already has garnered international attention for the University.
Contact Information
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Published on April 08, 2010