US ethanol producer Pacific Ethanol Inc (NASDAQ:PEIX) will install a 5-MW solar power system at its plant in Madera, California.

The system, to be designed and built by Borrego Solar Systems, will reduce the Madera facility's utility costs and drive premium pricing on the ethanol produced due to improvements in its carbon-intensity score, Pacific Ethanol said today. The installation is set to displace more than 30% of the grid electricity currently used by the plant and will also qualify for the energy investment tax credit.

According to the company's president and chief executive Neil Koehler, this is the first ever commercial solar electricity system at a US ethanol plant. Subject to completing interconnection agreements with local utility Pacific Gas & Electric Co, the solar system is expected to be fully operational in early 2018, Koehler said.

Pacific Ethanol financed USD 10 million (EUR 8.9m) of the project's total expected costs of USD 11 million through property assessed clean energy (PACE) financing, which supports energy efficiency, renewable energy and water conservation upgrades to buildings.