Cabinet for Economic Development
Gov. Beshear Announces 3 Louisville Companies to Invest $22 Million, Retain 340 Kentucky Workers, Create 14 Additional Jobs
Partnership brings first active energy services biomass project to the Commonwealth
LOUISVILLE, Ky. (Oct. 26, 2011) – A unique three-member partnership utilizing the state’s first active energy services biomass project will bring $22 million in investment and 14 new jobs to Louisville, Governor Steve Beshear announced today.
He joined community leaders and officials from The Lubrizol Corporation, Zeon Chemicals and Recast Energy to announce the partnership will also keep 340 Kentucky workers on the job.
Lubrizol and Zeon are located adjacent to one another in west Louisville and share the use of steam and other utilities. Both facilities need steam, de-ionized water, waste water treatment and compressed air to operate. But in 2009, the utility provider for the two companies announced plans to close, leaving Lubrizol and Zeon without the steam and utilities they needed to continue production.
Instead of closing their doors or moving production elsewhere, Lubrizol and Zeon worked with state and local officials to develop a contract with Recast Energy to bring the third-party utility provider to the area – supplying the necessary steam and utilities for ongoing operation of the two facilities.
As a result, both companies will remain operational in their current locations, saving 340 jobs, and Recast will hire 14 new employees to provide services in their new location.
“This cooperative effort between state and local government and the private sector is what economic development is all about,” Gov. Beshear said. “Together we can overcome obstacles by finding solutions that will not only generate new investment, but will also ensure the continued job security of Kentucky workers and long-term success of Kentucky companies. I thank Lubrizol, Zeon and Recast Energy for their commitment to the Commonwealth.”
The Governor began conversations with Zeon during his trip to Japan in 2009. Zeon Chemicals, headquartered in Louisville, is a wholly owned subsidiary of Zeon Corporation of Tokyo.
“Anytime we can help retain a business in Louisville and in Kentucky, it’s a win,” said Louisville Mayor Greg Fischer. “We not only helped retain two major companies, but a third company also will be growing because of this project, and together, they are pioneering a newer and cleaner way of powering their plants. That also is a big win.”
Recast Energy’s entrance to the market brings the first active energy services biomass project to the Commonwealth. Recast Energy converts cost-competitive biomass, or organic matter, into green electricity and thermal energy (steam) for its industrial customers.
Recast Energy is in the process of retrofitting a coal-fired boiler to consume clean biomass. The boiler is expected to be operational in the second quarter of 2012. The project is expected to entail a $12 million investment and will create 14 new jobs. Additional off-site jobs in the new biomass fuel supply chain created by this project are expected to add another 12 to 20 full-time people in the area through third-party fuel suppliers.
“Recast Energy is pleased to be investing in the future of Kentucky’s industrial sector with safe, efficient, and reliable energy,” said Brandon K. Ogilvie, executive vice president and CFO of Recast Energy. “By using renewable fuels sourced from the surrounding areas, this project not only benefits the natural environment but also boosts the local economy with several dozen permanent jobs.”
The Lubrizol Corporation, operating in Louisville since 2004, produces two families of products at the Louisville plant – Vycar® latexes, used in a wide range of coating applications and TempRite® CPVC resins, used in a wide range of extrusion and molding applications. Lubrizol will invest nearly $6.5 million and retain 128 Kentucky employees.
“Receiving the incentive approval was a significant factor in our decision to move forward with the project and sustain long-term operations in Louisville,” said Sam Striegel, plant manager for Lubrizol. “We appreciate the creativity and support from Greater Louisville Inc. and the Cabinet for Economic Development in making the deal happen. A secure, long-term supply of utility services to the plant ensures that Lubrizol can effectively and efficiently operate into the future.”
Headquartered in Louisville since 1989, Zeon Chemicals produces specialty elastomers for a variety of customers, including those in the automotive, industrial and housing industries. The company’s $3.5 million investment will retain 212 local jobs.
“Our previous utility supplier announced their exit from the Louisville area during the lowest period for our business of the 2008-2009 recession,” said Tom Gettelfinger, president and CEO of Zeon Chemicals. “The future of our operation in Louisville was in serious jeopardy. The commitment and support of the city and state were instrumental in facilitating the cooperative agreements between Recast Energy, Lubrizol and Zeon to secure our long term future in the area.
To facilitate this partnership and reinvestment, the Kentucky Economic Development Finance Authority preliminarily approved Lubrizol and Zeon for tax incentives up to $1.75 million each through the Kentucky Reinvestment Act. The program is designed to assist companies that need to make significant capital investment in Kentucky facilities in order to remain competitive and retain existing workforces.
“This three-way partnership will result in the retention of hundreds of jobs for our families in Jefferson County and the surrounding area,” said Sen. Gerald A. Neal, of Louisville. “These companies are good corporate citizens, and we appreciate their investments and look forward to many more years of working together. I appreciate Gov. Beshear taking the lead to support this three-way partnership and in advancing the manufacturing industry with biomass powered fuel.”
“This announcement is a major step forward for Kentucky in two key ways. First, it preserves hundreds of jobs at a time when we need them more than ever, and, two, it helps address long-term environmental issues that have been endemic in our community,” said Rep. Reginald Meeks, of Louisville. “This is great news for west Louisville and for Jefferson County, and I’m happy it signals the arrival of Kentucky's growing biomass industry.”
“This is a tremendous deal for west Louisville and our region,” said Joe Reagan, president and CEO of Greater Louisville Inc. – Metro Chamber of Commerce. “It is a great retention and growth opportunity within the manufacturing sector and a huge step forward for cleaner energy.”
For more information on Lubrizol Corporation, visit www.lubrizol.com.
For more information on Zeon Chemicals, visit www.zeonchemicals.com.
For more information on Recast Energy, visit www.recastenergy.com.
Information on Kentucky’s economic development efforts and programs is available at www.ThinkKentucky.com. Fans of the Cabinet for Economic Development can also join the discussion on Facebook at www.Facebook.com/ThinkKentucky or follow on Twitter at www.Twitter.com/ThinkKentucky.
A detailed community profile for Louisville (Jefferson County) can be viewed at http://thinkkentucky.com/EDIS/cmnty/index.aspx?cw=091.