Getting to Yes or Bailing on No: The Site Selection Process of Ethanol Plants in Wisconsin†

Prior studies of ethanol location rest on the assumption that ethanol producers are economic free agents—evaluating sites as if all counties are contenders for their business, weighing the availability of feedstocks along with their infrastructure needs, operating without ties to localities, and being subject to enticement from policy incentives. We analyze the political-economic process through which ethanol plants come into communities by examining plant location decisions, plant financing, community receptivity toward the plant, local government incentives, and the dynamics of the approval process. We use case studies of ethanol plants in Wisconsin to explore the economic, social, and political dynamics of ethanol plant location. Our case studies provide evidence in support of some findings in the ethanol location literature—such as the importance of access to corn; however, they also suggest site selection criteria not adequately addressed by the literature. Furthermore, our data suggest that capital may not be as mobile as location theory assumes it to be and that location decisions are not primarily determined by consideration of profit maximization. Instead, the location of ethanol plants is greatly influenced by the extent to which the original initiators of the plant are locally embedded in its host community. Our research answers Barkley and McNamara's (1994:45) call for a return to a case studies approach in order to develop “reliable insights into the location process.”