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Ontario’s government recently announced a plan to provide operating grants for new ethanol plants. That’s good news for both ethanol producers and railroads, according to the Railway Association of Canada (RAC).

For one, the Integrated Grain Processors Cooperative will receive federal funds to help fund the construction of an ethanol plant in Aylmer, Ontario. Scheduled to open next year, the facility will require about 15 million bushels of corn — much of it moved by rail — to produce ethanol.

“I don’t know of an ethanol plant that isn’t going to be located on a railway line,” said co-op Chairman Tom Cox in a statement prepared by RAC.

Ethanol producers also will rely on railroads to move a majority of outbound distiller’s grain and other materials. Trillium Railway — which interchanges with Canadian National Railway Co., Canadian Pacific Railway and Norfolk Southern Corp. — will handle some of that traffic for the Aylmer plant.

“I wouldn’t think twice about putting a plant on a site with access to three carriers,” said Trillium’s Marketing Director Doug Hayston.