Tilling for Energy Could Increase Farm Profits by $5 Billion

Studies indicate Congress and Administration should increase support for bioenergy.

WASHINGTON, D.C. (March 2, 2005) -- “Two recently released reports point to a brighter energy future for all Americans and more profits for farmers if Congress takes the necessary action to support bioenergy,” said Brent Erickson, Vice President for Industrial and Environmental Technology at the Biotechnology Industry Organization.

The first report, “Growing Energy: How Biofuels Can Help End America’s Oil Dependence,” provides further weight to the potential benefit of biofuels -- typically ethanol from grain and crop residues -- in reducing America’s dependence on foreign oil while adding $5 billion annually to farm profits by 2025 if production commitments are made now. The report was issued by the nonprofit National Resources Defense Council and is available here.

“Renewable agriculture resources are readily available for more domestic energy production. A new type of biotechnology called industrial biotechnology is so innovative that now companies in this area have the means to convert straw to gold. By using advanced biotech enzymes to convert crop residues to sugars and then to ethanol and other products, farmers can harvest and sell two crops from every field planted -- a food crop and a biomass energy crop,” Erickson said.

The second report, “25 by 25: Agriculture’s Role in Ensuring U.S. Energy Independence” by the Ag Energy Working Group of the Energy Future Coalition, shows how America’s farmers can contribute 25 percent of the total energy consumed in the United States by 2025 and not at the expense of producing abundant, safe and affordable food and feed. The group comprises a blue-ribbon panel of farmers, educators, co-op directors, and members of a broad range of agriculture associations. The report is available here.

“Farmers and those in the ethanol and biotech industries need to pull together to get the federal government to develop new policies that reward the construction of ultra-modern biorefineries that can employ industrial biotechnology to convert corn stover, wheat straw and other crop residues to ethanol. If we do that, in a few short years, the United States could be producing tens of billions of gallons of ethanol more than we are producing today and the farm economy would get a real boost,” Erickson said.

“The United States currently makes about 3 billion gallons of ethanol a year from grain. New biotechnology processes are now available that could result in 40 to 70 billion gallons of ethanol a year being produced from crop residues,” Erickson said. “Because of lead times needed to build new plants we must work now on getting the next generation of advanced biorefineries built so we can ratchet up ethanol production.”

The “25X25” report calls on America and its farmers to focus on energy production as a primary objective. Benefits include added income, added value for crops and byproducts, diversification to alternative enterprises, productive use of marginal land, reducing pollution, reducing reliance on government payments and creating new jobs in rural areas.

“What must be overcome is our lack of focus on harnessing agriculture’s renewable energy opportunities, lack of vision, and lack of action plans,” Erickson said. “Congress and the administration are not doing enough to help us make the farm belt the energy fields of tomorrow and to kick the addiction of foreign oil. We should do more tilling for energy and less drilling for energy.”

The “25X25” report calls on America’s agriculture sector to step up and educate decision-makers and the general public. Other tasks include crafting new public policy, developing production and marketing strategies, creating alliances, securing capital, building commercial-scale plants, and solving processing, transportation, transmission and distribution challenges.

The “Growing Energy” report predicts a brighter future for farmers, noting that using biomass for ethanol production could result in $5 billion in added farm profits. The prediction is based on $40 per dry ton and 200 million tons of biomass, which is less than one-sixth the total amount of biomass farmers could produce by 2050.

The result of a two-year study by agricultural, engineering and environmental experts, the “Growing Energy” report is the first to focus on what bioenergy technologies can do when commercially mature and operating on a large scale. In addition to adding to farm profits, biofuels have the potential of being cheaper than gasoline and diesel. This could save about $20 billion per year on fuel costs by 2050 while reducing greenhouse gas emissions by 1.7 billion tons per year. That is equal to more than 80 percent of transportation-related emissions and 22 percent of total emissions in 2002.