The Energy Department has granted Solugen a $214 million loan to construct a "bioforge" for the production of sustainable chemicals.

• The Department of Energy has provided Solugen, a sustainable chemicals startup, with a $214 million loan, similar to the support it extended to Tesla during its early years.
• A new plant in Marshall, Minnesota will be constructed by the company that produces chemicals from corn sugar instead of petroleum, with the help of the financing.
• Solugen has secured over $640 million in venture capital funding from notable investors such as Baillie Gifford, GIC, Temasek, BlackRock, Founders Fund, and Fifty Years.

The U.S. Department of Energy has committed $214 million in financing to Houston-based startup Solugen through a program well-known for supporting electric vehicle manufacturers in their early stages.

Gaurab Chakrabarti, CEO of Solugen, and CTO Sean Hunt announced that the company will use a loan to construct a "bioforge," or sustainable chemicals plant, in Marshall, Minnesota.

The company converts corn sugar (also known as dextrose) into eco-friendly chemicals that are essential components for the manufacturing of concrete, industrial and wastewater treatments, and household detergents.

Solugen, with around 200 full-time employees in Texas, plans to add approximately 60 more employees in Minnesota in the long term. The new facility will be located near large American manufacturers, General Mills and 3M, which have served as inspiration to co-founders Hunt and Chakrabarti, as they shared with CNBC.

As Solugen expands its operations to the north, the company is also developing new enzymes from renewable feedstock. The CEO stated that they are currently focusing on creating sustainable chemicals from sugar that can be used to make plastics and nylon without leaving behind any harmful substances like heavy metals or PFAs.

Solugen had raised more than $640 million in venture funding from firms including Baillie Gifford, GIC, Temasek, BlackRock, Founders Fund, Fifty Years and Refactor before securing a substantial loan from the DOE.

The Loan Programs Office at the DOE has committed to loaning money to Solugen, one of only 20 companies to receive such a commitment, with a focus on chemicals production.

"Creed stated that our organization's goal is to stimulate the growth of the clean energy sector. We offer financial assistance to American entrepreneurs and businesses to develop projects in the U.S. that will create jobs, benefit the community, and decrease greenhouse gas emissions in their operations."