By Lynda Kiernan
The IMPACT Carolina Fund, a Qualified Opportunity fund managed by Carolina Opportunity Funds created to provide early and Seed stage financing to Qualified Opportunity Zone Businesses in North and South Carolina, has made its first investment in BioEconomy Solutions – a technology leader in sustainable agriculture crops for biofuels, animal feed, and food products.
Founded on the belief of the firm’s Principal Hannah Kirby that capital investment can transform communities, the Carolina Opportunity Funds manages multi-round Qualified Opportunity Funds targeting Seed through Series A financing for Opportunity Zone projects in tertiary markets. These are markets across North and South Carolina that would otherwise not attract attention from developers or businesses.
The capital secured through this partnership will fund BioEconomy Solution’s planned renewable diesel plant to be located in a Qualified Opportunity Zone in Georgetown, South Carolina, that will create 200 full-time jobs and another 100 supply chain support jobs.
“BioEconomy’s decision to locate an advanced biodiesel processing plant within an economically disadvantaged Opportunity Zone represents the spirit of the Opportunity Zone Initiative,” said Hannah Kirby, managing partner, Carolina Opportunity Funds.
“The vast majority of Opportunity Zones within the Carolinas are in rural communities and the BioEconomy Solutions project will provide measurable economic growth to the region,” continued Kirby. “Not only do investments in Qualified Opportunity Zones provide tax incentives, companies like BioEconomy Solutions are on the cusp of a new wave of agribusiness technologies that will drive the future growth of the industry.”
The company also has secured a 10-year agribusiness contract to produce renewable energy crops for the EU biofuels market with an offtake agreement with the UK, and has created three vertical markets for its bio-friendly crops, ensuring channels through which to realize significant future growth.
Targeting the EU biofuels market appears to be a sharp decision at this time. This year is the first year that the EU’s revised Renewable Energy Directive (REDII) will be in place, increasing biofuel mandates every year through 2030.
RED II has set a target of 32 percent for renewable energy over the course of its life, and a target of 14 percent for renewable energy for transportation. S&P Global noted that most EU member states will have higher mandates in 2020 than a year before, with the Netherlands leading the pack, increasing its mandate from 12.5 percent to 16.4 percent year-on-year.
Germany, which is the top consumer of biofuels in the EU, is raising its greenhouse gas (GHG-based) mandate from 4 percent to 6 percent, and the UK, where BioEconomy Solutions has a takeoff agreement, has implemented a dual mandate last year on both a volume and GHG-basis – increasing its volume mandate from 7.25 percent to 9.75 percent, and its GHG-based mandate from 4 percent to 6 percent.
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.