Incentives could turn costs of biofuel mandates into environmental benefits – ScienceDaily

New studies from the Center for Advanced Bioenergy and Bioproducts Innovation (CABBI) shed more light on the economic and environmental costs of warrants in the Renewable Fuels Standard (RFS), a federal program aimed at developing the national biofuels sector.

The researchers said studies indicate the need for more targeted policies that value the environmental and ecosystem benefits of perennial bioenergy crops over cheaper options – and provide financial incentives for farmers to grow them.

The RFS was published in 2005 and updated through the Energy Independence and Security Act 2007 to strengthen U.S. energy security, reduce greenhouse gas (GHG) emissions, and promote rural development. The 2007 standards required blending 36 billion gallons of first-generation biofuels (made from food crops like corn, like ethanol) and second-generation biofuels (made from miscanthus biomass or other energy raw materials) with fossil fuels by 2022, to replace petroleum fuel oil and fuel oil. The corn ethanol mandate has been fulfilled, with 15 billion gallons produced annually, but cellulosic biofuel production has been negligible. Targets beyond 2022 have yet to be determined.

Biofuel mandates impact the environment in multiple ways – affecting land use, GHG emissions, nitrogen (N) application and the leakage of harmful nitrogen compounds into the soil, air and water. These impacts vary by commodity, as do the economic costs and benefits for consumers who purchase food and fuel, and for producers, depending on cultivation costs and competition for cropland for alternative uses.

The first study calculated the net economic and environmental costs of RFS mandates and found that maintaining the corn ethanol mandate would result in a cumulative net cost to society of nearly $ 200 billion from 2016 to 2030 compared to the absence of RFS. The social cost of nitrogen damage from corn ethanol production significantly outweighs the social benefits of GHG savings.

On the other hand, the implementation of the additional cellulosic mandate could provide substantial economic and environmental benefits with technological innovations that reduce the costs of converting biomass to cellulosic ethanol and policies that place a high monetized value on the benefits of cellulosic ethanol. GHG mitigation. This study, published in Environmental research letters, was led by Madhu Khanna, CABBI Sustainability Theme Leader and Ph.D. student Luoye Chen from the University of Illinois at Urbana-Champaign.

The second study examined how full implementation of the RFS mandates will affect water quality in the Mississippi / Atchafalaya (MARB) basin and the Gulf of Mexico, which are plagued by nitrogen runoff from corn fields. and soy. The increasing levels of N depleted oxygen and created a hypoxic dead zone in the Gulf. Specifically, this study examined whether diversifying cultivated land with perennial energy crops – such as CABBI crops – could reduce the loss of N associated with maize production and thus improve water quality while achieving the objectives of the RFS.

He found that the most economical place to grow perennial bioenergy crops, which typically require less nitrogen fertilizer and less N runoff, was inactive cropland. This limited their potential for reducing N runoff, which would be greatest if they replaced N-intensive row crops on cropland. The N reduction benefits of bioenergy crops would also be more than outweighed by the increased runoff generated by harvesting low cost crop residues such as corn stalk – corn leaves and stalks left after harvesting the grain. – for cellulosic biomass. The results suggest that targeted incentives to reduce nitrogen loss are needed to persuade growers to replace nitrogen-intensive row crops as well as biomass from corn stalks with bioenergy crops. Posted in Environmental science and technology, the study was led by associate professor of agronomy Andy VanLoocke and Ph.D. student Kelsie Ferin of Iowa State University.

Together, the studies have shown that maintaining the corn ethanol tenure pushes more land into corn production, which increases the market price of other agricultural products. While producers can benefit from higher market prices, consumers who buy fuel or agricultural products pay the price. And while the corn ethanol mandate may help mitigate GHGs by replacing fossil fuels with biofuels, it increases nitrogen leaching due to increased fertilizer use with increased corn production. . This worsens the quality of the water in the MARB and the Gulf of Mexico and results in enormous environmental and social costs.

In contrast, the cellulosic ethanol mandate could provide an overall benefit with the right policies. Supporting research and development to reduce the cost of converting biomass to cellulosic ethanol would significantly reduce production costs and increase social benefits, and a high monetized value for GHG mitigation could outweigh all other costs.

These results should lead decision-makers to question the effectiveness of technological mandates like the RFS which treat all cellulosic raw materials as identical. It encourages cheaper options like corn stalks and limits incentives to grow high-yielding perennial energy crops that have lower carbon intensity and nitrogen leakage, but are more expensive with current technology.

CABBI researchers hope that performance-based policies – including the standard on low-carbon fuels, taxes on carbon and nitrogen leakage, or limits on crop residue harvest and l application of nitrogen – can be implemented to complement RFS mandates after 2022.

The complexity of biofuel policies requires the expertise of agronomists and economists, as in these studies. The two research teams have developed integrated economic and biophysical models incorporating a wide range of factors in their analyzes.

“CABBI offers an excellent opportunity for this type of research, inspiring collaborations from different disciplines,” said Khanna.

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