Highwater Ethanol, LLC filed a Form 8-K on September 23, 2026, disclosing financial results for the third quarter of fiscal year 2026 and outlining future operational upgrades. The company reported a net income of $10,836,354 for the three-month period ending September 2026. This figure includes operating income of $5,661,285 and $5,175,069 in other income, largely attributed to the sale of 2025 Section 45Z tax credits. The proceeds from the sale of these credits were approximately $0.20 per gallon produced in calendar year 2025. The company anticipates that the 2026 45Z tax credits, which were updated and extended by the One Big Beautiful Bill passed in July 2025, will yield approximately $0.30 per gallon produced.
For the nine-month period of fiscal year 2026, Highwater reported a net income of approximately $24.8 million. The company noted that crush margins have been strong, with improvements in both ethanol and corn oil sales compared to the previous year. The 45Z tax credits accounted for $5.0 million of income for the three months and $11.7 million for the nine months.
The filing details two major construction projects expected to commence later in 2026 with completions anticipated in July 2027. The first project involves the addition of a sixth fermenter, while the second is the installation of a Dryer Exhaust Energy Recovery System (DEER). Both projects are intended to improve operational efficiencies, potentially benefitting crush margins and reducing the company's Carbon Intensity score.
Additionally, Highwater submitted an Air Emissions permit application to the Minnesota Pollution Control Agency in January 2026, with approval anticipated in October 2026. The company projects that with this permit, it may increase production to approximately 87 million gallons of denatured ethanol per year. Currently, the facility operates at an annual production level of approximately 69.7 million gallons.
Regarding governance, the company announced that at the 2026 Annual Meeting, members elected David Eis, William Garth, and David Moldan to serve additional three-year terms as Group I Governors.
