By RICHARD BURGER

AB BioEnergy has received grant and loan funds from the Washington State Department of Commerce that will be used to create a bio-diesel plant in the Yakima Valley later this year.

A press release from AB Foods headquarters in Boise, Ida., said the funds were made available through the American Recovery and Reinvestment Act.

Terms of the loan and grant are still being worked out, the company said, but potentially they could amount to a $1.4-million loan and a $600,000 grant.

The plant is expected to begin production in about a year, and will convert tallow and waste grease into bio-diesel.

No specific time frame has set yet, for construction or beginning of production.

The raw materials will come from livestock processors “throughout Washington and Idaho,” the press release said.

The location of the plant has not yet been determined.

“We’re in discussions with people throughout the Yakima Valley,” said Rick Stott, AB Foods spokesman.

The specifications of the new facility are also still under consideration, but groundbreaking is tentatively planned for late 2010, according to the press release.

Production is slated to begin in the spring of 2011, and production output and hiring will ramp up to full capacity over a three-year period.

Estimates call for a moderate-size plant with a production capacity of between five and 10 million gallons of bio-fuel annually.

The facility is expected to employ six to 12 individuals. 

In a prepared statement, Stott said, “In conjunction with the State of Washington, we are proud to foster economic development in a rural community in Eastern Washington while reducing our reliance on foreign fuels and reducing greenhouse gas emissions.

“AB BioEnergy is committed to helping Washington continue its leadership in the clean, renewable energy sector for years to come.”