DG Fuels Set to Transform Phelps County Economy

The new DG Fuels synthetic fuel plant planned in Phelps County will majorly impact the local economy, boosting retail and agricultural sales and creating hundreds of jobs.

A new study commissioned by the Phelps County Development Corporation estimated the project will boost the Phelps County economy by hundreds of millions of dollars annually when it becomes operational. Prepared by NPPD economist Melissa Trueblood, PhD., the study estimates that during the construction phase of the project capital expenditures will top $4.2 billion, and the project will generate new taxes on production and imports (TPI) exceeding $5 million.

“These figures could change, even increase, as we move through this process, but it’s clear that DG Fuels is a transformational project for our region,” PCDC Executive Director Ron Tillery said. “And the benefits will extend across every sector of the economy.”

Once the plant is operational, the projected annual payroll for 640 permanent DG Fuels employees will reach $54 million and create an additional 313 secondary jobs such as doctors, teachers, restaurant workers, etc. That secondary employment is expected to generate more than $16 million annually. The report showed that the community could expect to see a 15.7 percent increase ($6.3 million) in retail sales annually once the project is complete.

“This project truly is the definition of economic development,” PCDC Board President Shane Westcott said. “The millions of dollars it will inject into the economy will have a tremendous effect on generations well into the future. Even without the additional on-farm revenue included, this project will have a positive economic impact for everyone in Phelps County. The jobs will allow young people to stay in Phelps County and raise their families.”

DG Fuels will purchase an estimated 1.2 million tons of corn stover annually adding $144 million into the pockets of farmers in the South Central Nebraska region with no negative impacts on supplies for cattle feed or nutrient replenishment in the fields.

Westcott, who is also a Phelps County farmer, said the project is truly value added for local ag producers.

“Farmers will have the opportunity to sell a product they are already producing - stover,” Westcott said. “It's an income stream that can be tapped into relatively easily. All farmers in the area will have equal opportunity to sell the product to DG Fuels. The residual impact on things like implement dealers, ag input sales, etc., will have a long-standing effect on profitability for those operations. These positive effects for the ag sector are phenomenal.”

Gov. Jim Pillen has said that bioeconomy projects like the DG Fuels project will be Nebraska’s “Silicon Valley” opportunity.  Pillen said these projects will boost the state’s rural economy and revitalize the job market.

Julie Bushell, head of the Nebraska BioEconomy initiative, said Nebraska is well-positioned to lead the emerging economy.

“We’ve got everything we need right here – people, water crops, livestock,” Bushell said. “We’re at the forefront of sustainable agriculture, and now is the time to leverage that. Our state’s longstanding leadership in water management and agricultural practices positions us to deliver what the global economy is demanding.”

In a video posted to News Channel Nebraska, Bushell said farmers will not be required to conform with the SAF tax credit, which means that all farmers can equally participate using their current farming practices. 
A team of local ag experts and farmers has worked closely with Bushell to finalize details of grower agreements for the project.

“Our understanding today is that the contracts will be rolled out to farmers in public meetings giving all farmers an equal opportunity to contract with DG Fuels,” Westcott said. “The goal is to have transparent, detailed communications with farmers.”

Initially, the focus will be on farmers in an eight-county region surrounding Phelps County. Meetings with farmers could take place as early as December.