Transcript BIOENERGY - Center for North American Studies

Office of the Chief Economist
Office of Energy Policy and New Uses
Bioenergy and the USDA:
Policy Perspectives
Harry S. Baumes, Ph. D.
Associate Director
Office of Energy Policy and New Uses
The Economics of Alternative Energy Sources and
Globalization: The Road Ahead
Embassy Suites Airport
Orlando, Florida
November 16, 2009
Office of the Chief Economist
Office of Energy Policy and New Uses
BACKGROUND
• Energy Independence and Security Act of
2007
– RFS 2
– GHG Reductions
• Food, Conservation and Energy Act of
2008
– Energy Title IX
• Positions and Personalities
Office of the Chief Economist
Office of Energy Policy and New Uses
President Obama’s
Commitment to Renewable
Energy
“To put people back to work
today, and reduce our
dependence on foreign oil
tomorrow, we will double
renewable energy
production.”
Office of the Chief Economist
Office of Energy Policy and New Uses
President Commitment to
Renewable Energy
“From China to India, from Japan
to Germany, nations everywhere
are racing to develop new ways to
produce and use energy. The nation
that wins this competition is the
nation that will lead the global
economy. I am convinced of that.
And I want America to be that
nation”.
Remarks made at MIT, October 23, 2009
Office of the Chief Economist
Office of Energy Policy and New Uses
“USDA is working to expand
energy opportunities by producing
alternative forms of energy and fuel,
and to ensure that we are doing the
research necessary to allow
agriculture to transition away from
its rather significant dependence on
fossil fuels.”
Tom Vilsack
Agriculture Secretary
Office of the Chief Economist
Office of Energy Policy and New Uses
40
EISA – EPACT Renewable Fuels Standard
RFS1
Conventional - Corn Starch
Biobased Diesel
Cellulosic Biofuels
Other Advanced Biofuels
35
Other Biofuels
Billion
Gallons
Years
30
25
Biobased Diesel
20
Cellulosic Biofuels
15
Conventional Corn Starch
10
5
RFS1
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Billion
Gallons
Years
2016
2017
2018
2019
2020
2021
2022
Office of the Chief Economist
Office of Energy Policy and New Uses
U.S. Biodiesel Production, 1999-2009
800
700
600
Million gallons
500
400
300
200
100
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009e
Office of the Chief Economist
Office of Energy Policy and New Uses
U.S. Ethanol Production, 1980-2009
12000
10000
Million gallons
8000
6000
4000
2000
0
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
Office of the Chief Economist
Office of Energy Policy and New Uses
Biofuels Interagency Working Group
On May 5, 2009, President Obama signed the directive
establishing a new working group to be chaired by
the Secretaries of Energy and Agriculture and the
Administrator of the EPA.
The group will work with the National Biomass Research and
Development Board on:
– Creating a biofuel market development program to boost
next-generation biofuels, increase use of flex-fuel vehicles,
and assist retail market development
– Coordinating infrastructure policies
Office of the Chief Economist
Office of Energy Policy and New Uses
Food, Conservation, and Energy Act of 2008 Title IX – Energy
•
•
•
•
•
•
•
•
Federal Procurement of Biobased Products (9002)
Biorefineries Assistance (9003)
Repowering Assistance (9004)
Bioenergy Program for Advanced Biofuels (9005)
Rural Energy for America Program (9007)
Biomass Research and Development (9008)
Biomass Crop Assistance Program (9011)
Forest Biomass for Energy (9012)
Farm Bill Title IX
Office of the Chief Economist
Section 9006 Funding Activity FY2003 - 2008
Office of Energy Policy and New Uses
Renewable Energy/Energy Efficiency
Loans, Grants &
Combos
Amount
$65,188,772
48,008,511
4,683,405
1,969,517
2,620,736
$122,470,941
Technology
Biomass
Wind
Solar
Geothermal
Hybrid
Subtotal
No.
271
245
108
52
18
694
Energy Efficiency
1,329
$34,456,722
$76,743,867
Subtotal
2,023
$156,927,663
$1,082,245,559
153
2,176
$91,529,855
$248,457,518
$181,321,296
$1, 263,566,855
Guaranteed Loans
Grand Total
Leveraged
$321,322,470
582,427,329
11,207,057
4,576,639
85,968,197
$1,005,501,692
Office of the Chief Economist
Office of Energy Policy and New Uses
Looking Ahead
• USDA working with the EPA – final rule for
implementation of the RFS2
• EPA Ruling on Growth Energy Waiver Request –
raise fuel blend to 15%
• House and Senate Energy Bills
• Commitment by USDA to Expand Biofuels
(Biomass) Production
• USDA Strategic Plan
• IWG - Biofuels
Office of the Chief Economist
Office of Energy Policy and New Uses
Biofuels
• 1st generation, corn-ethanol, sugar-ethanol,
biodiesel, used vegetable oil, animal fats
• 2nd generation, cellulosic biofuels
• 3rd & 4th generation, biofuel from organic wastes
(solid waste, biosolids, animal wastes, green wastes,
food production and pulp and paper wastes,
plastics, auto shredding residues, tires) and biofuel
from plants that can sequester high levels of CO2
(algae, eucalyptus)
Office of the Chief Economist
Office of Energy Policy and New Uses
Expanding Biofuel Feedstock
• Increasing export demand for food and high crop returns
compete for land and limit the conversion to dedicated
energy crops
• Expansion of land comes from - cropland, cropland idled
by farmers and government programs, cropland pasture,
and summer fallow – limited resource
• International response to higher commodity prices can
change the equation
• Cropland expansion at the global level is possible in
several countries (Angola, Rep. of Congo, Sudan, Brazil,
Argentina, and others)
• Conversion of land (rain forest, savanna and pasture) to
crops in the above countries can increase GHG
emissions
Office of the Chief Economist
Office of Energy Policy and New Uses
Environmental Issues
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•
•
•
•
Land-use (direct and indirect)
Nutrient and other contaminant runoff
Water quality and availability
Soil loss due to water and wind erosion
Greenhouse gas emissions ( CO2 and
non CO2)
Office of the Chief Economist
Office of Energy Policy and New Uses
BIOFRENZY
Office of the Chief Economist
Office of Energy Policy and New Uses
Friday, July 4, 2008 by
The Guardian / UK
Office of the Chief Economist
Office of Energy Policy and New Uses
BIOFRENZY
At USDA
with Commitment and
Direction
Office of the Chief Economist
Office of Energy Policy and New Uses
THANK
YOU!
Contact Information: Harry S. Baumes
[email protected]
202-401-0497