California's new budget provided a boost to ethanol projects, which means Pacific Ethanol, a producer of ethanol fuel, will reopen a plant in Stockton within 60 days.

The facility in Stockton could reopen in December. A plant in Madera also will reopen if market conditions allow, said Neil Koehler, president and CEO of Pacific Ethanol Inc.

The plants are coming back because the state budget approved Oct. 8 included the California Ethanol Producer Incentive Program, for which the two plants are eligible. In addition, the U.S. Environmental Protection Agency allows newer vehicles to use a blend of 15% ethanol and 85% gasoline. Previously, the mix was limited to 10% ethanol.

Whether that means, however, that more ethanol will wind up in the mix remains to be seen, as this report says. The vagaries of corn crop and prices also play strong roles.

The Stockton plant has a capacity of 60 million gallons. In Madera, the capacity is 40 million gallons. Koehler did not say how many jobs would be created when the plant reopens.

The company recently restructured financially after filing for bankruptcy protection, which allowed it to sell warrants and raise $35 million in cash, sell minority interest in an energy company for $18 million and retire $17 million in debt.

A dramatic drop in ethanol prices led to the bankruptcy filing, according to The Sacramento Bee.