Sempra Energy's Stamford, CT-based trading arm, Sempra Commodities, Monday announced an agreement with a renewable energy partnership, Pennsylvania-based New Hope Partners, to create a joint venture specializing in ethanol production in the United States. The partners expect to begin operations in the second quarter this year, Sempra said in its announcement, which did not include terms or conditions for the joint venture.
"This is just an agreement by the two parties to form the joint venture," said a Sempra Energy corporate spokesperson in San Diego. After that is formed, there should be more to say about the length of time, investment and volumes that the partnership would develop and market, he said.
Formerly known as Sempra Energy Trading, Sempra Commodities, the fifth largest natural gas marketer in the nation, appears to be applying its experience in marketing energy commodities and associated risk-management products/services to the renewable market in which the domestic market for the fuel is potentially sizable.
Characterized as "non-toxic, water-soluble and quickly biodegradable," Sempra stressed that ethanol is blended with gasoline to help reduce motor vehicle emissions, causing more than 3 billion gallons of ethanol to be consumed annually in the United States. About one-third of the gasoline sold in the United States contains some ethanol, Sempra said.
"As the United States embraces the development of all forms of renewable energy, we expect the ethanol market to grow rapidly and be a significant component of our nation's energy mix over the next decade," said Tammy Norman, Sempra Commodities business development vice president.
New Hope Partners will site and develop ethanol production facilities, and Sempra will market the output and provide risk-management services. New Hope describes itself as a "business development, capitalization, and strategic execution specialist with a core focus in value-added, agricultural and renewable-energy-based start-up ventures." It is presently involved in making ethanol and related products on a national basis, according to Sempra's announcement.
New Hope brings finance and business operations skills, along with an affiliation to registered securities dealer Chartworth Capital LLC. The firm's web site (www.newhopepartners.com) is currently under construction, and Chartworth (www.chartworth.com) describes New Hope as one of its partners, calling the Pennsylvania firm one that concentrates on "renewables, food processing and agriculture technology."
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