Qi BioEnergy

Switchgrass could be a new crop for   farmers.   Photo: Warren Gretz, NREL

Tripling U.S. use of biomass for energy could provide as much as $20 billion in new income for farmers and rural communities and reduce global warming emissions by the same amount as taking 70 million cars off the road.

Many farmers already produce biomass energy by growing corn to make ethanol. But biomass energy comes in many forms. Virtually all plants and organic wastes can be used to produce heat, power, or fuel.

Biomass energy has the potential to supply a significant portion of America’s energy needs, while revitalizing rural economies, increasing energy independence, and reducing pollution. Farmers would gain a valuable new outlet for their products. Rural communities could become entirely self-sufficient when it comes to energy, using locally grown crops and residues to fuel cars and tractors and to heat and power homes and buildings.

Opportunities for biomass energy are growing. For example, several million dollars of federal incentives are available through the 2002 Farm Bill to develop advanced technologies and crops to produce energy, chemicals, and other products from biomass. A number of states also provide incentives for biomass energy.

Biomass Energy Sources on the Farm

Biomass Residues

Agricultural activities generate large amounts of biomass residues. While most crop residues are left in the field to reduce erosion and recycle nutrients back into the soil, some could be used to produce energy without harming the soil. Other wastes such as whey from cheese production and manure from livestock operations can also be profitably used to produce energy while reducing disposal costs and pollution.

Energy Crops

Crops grown for energy could be produced in large quantities, just as food crops are. While corn is currently the most widely used energy crop, native trees and grasses are likely to become the most popular in the future. These perennial crops require less maintenance and fewer inputs than do annual row crops, so they are cheaper and more sustainable to produce.

Grasses. Switchgrass appears to be the most promising herbaceous energy crop. It produces high yields and can be harvested annually for several years before replanting. Other native varieties that grow quickly, such as big bluestem, reed canarygrass, and wheat grass, could also be profitable.

Trees. Some fast-growing trees make excellent energy crops, since they grow back repeatedly after being cut off close to the ground. These short-rotation woody crops can grow to 40 feet in less than eight years and can be harvested for 10 to 20 years before replanting. In cool, wet regions, the best choices are poplar and willow. In warmer areas, sycamore, sweetgum, and cottonwood are best.

Oil plants. Oil from plants such as soybeans and sunflowers can be used to make fuel. Like corn, however, these plants require more intensive management than other energy crops.

Protecting the Land

With thoughtful practice and management, perennial energy crops can improve the soil quality of land that has been overused for annual row crops. The deep roots of energy crops enhance the structure of the soil and increase its organic content. Since tilling occurs infrequently, the soil suffers little physical damage from machinery. One study estimates that converting a corn farm of average size to switchgrass could save 66 truckloads of soil from erosion each year.

Perennial energy crops need considerably less fertilizer, pesticide, herbicide, and fungicide than annual row crops. Reduced chemical use helps protect ground and surface water from poisons and excessive aquatic plant growth. Furthermore, deep-rooted energy crops can serve as filters to protect waterways from chemical runoff from other fields and prevent sedimentation caused by erosion.

Finally, perennial energy crops can create more diverse habitats than annual row crops, attracting a wider variety of species such as birds, pollinators, and other beneficial insects, and supporting larger populations. Furthermore, the long harvest window for energy crops enables farmers to avoid nesting or breeding seasons.

Converting Biomass to Energy

Most biomass is converted to energy the same way it always has been—by burning it. The heat can be used directly for heating buildings, crop drying, dairy operations, and industrial processes. It can also be used to produce steam and generate electricity. For example, many electric generators and businesses burn biomass by itself or with other fuels in conventional power plants.

This 50 MW biomass power plant runs on residues produced by the nearby forest products industry. Photo: Warren Gretz, NREL

Biomass can also be converted into liquids or gases to produce electricity or transportation fuels. Ethanol is typically produced through fermentation and distillation, in a process much like that used to make beer. Soybean and canola oils can be chemically converted into a liquid fuel called biodiesel. These fuels can be used in conventional engines with little, if any, modification.

Biomass can be converted into a gas by heating it under pressure and without oxygen in a “gasifier.” Manure too can be converted using a digester. The gas can then be burned to produce heat, steam, or electricity.

Other biogas applications are still in development, but show great potential. One promising technology is direct combustion in an advanced gas turbine to run a generator and produce electricity. This process is twice as efficient as simply burning raw biomass to produce electricity from steam. Researchers are also developing small, high-speed generators to run on biogas. These “microturbines” have no more than three moving parts and generate as little as 30 kilowatts, which could power a medium-sized farm. Several companies are also considering converting gasified biomass into ethanol as a less expensive alternative to fermentation.

Alternatively, biogas can be processed into hydrogen or methanol, which can then be chemically converted to electricity in a highly efficient fuel cell. Fuel cells can be large enough to power an entire farm or small enough to power a car or tractor.

An innovative experiment in Missouri provides one example of the possibilities. Corn is used to produce ethanol, and the waste from the process is fed to cows for dairy production. Cow manure fertilizes the corn and is also run through a digester to produce biogas. A fuel cell efficiently converts the biogas into electricity to run the operation. The end products are ethanol, electricity, and milk. All the waste products are used within the project to lower costs.

Potential

Biomass currently provides about two percent of America’s electricity, one percent of the fuel used in cars and trucks, and some of the heat and steam used by homes and businesses. With more energy crops and better conversion technology, it could gain a much larger portion of the market. Energy crops and crop residues could provide 14 percent of U.S. electricity use or 13 percent of the nation’s motor fuel.

An Oak Ridge National Laboratory (ORNL) study found that farmers could grow 188 million dry tons of switchgrass on 42 million acres of cropland in the United States at a price of less than $50 per dry ton delivered (see map below). This level of production would increase total U.S. net farm income by nearly $6 billion. ORNL also estimates that about 150 million dry tons of corn stover and wheat straw are available annually in the United States at the same price, which could increase farm income by another $2 billion. This assumes about 40 percent of the total residue is collected and the rest is left to maintain soil quality.

Opportunities

One opportunity for energy crop development is to use land that is currently idle or poorly suited for food crops, such as that in the Conservation Reserve Program (CRP). This program encourages farmers and ranchers to adopt long-term conservation practices on environmentally sensitive land. In 2000, more than 34 million acres were enrolled in the CRP. Much of this land is already planted in native grasses and trees to help reduce erosion, protect water quality, and provide wildlife habitat. With careful management, farmers could harvest energy crops on some of this land. This would allow them to earn an income and reduce subsidy payments, while still maintaining the environmental benefits of the program.

A co-op in Iowa is testing this concept. In the Chariton Valley, farmers have planted 5,500 acres of CRP land with switchgrass to be burned with coal in a large utility power plant near Ottumwa. If successful, the project will scale up to 50,000 acres, producing 200,000 tons of switchgrass each year and supplying five percent of the plant’s fuel.

This example also shows that selling biomass feedstocks as a commodity to energy producers may be a more attractive option than producing biomass energy on the farm. Energy producers have greater access to capital and energy markets, can typically produce energy at a lower cost in larger facilities, and have the expertise to operate and maintain these facilities.

Since establishing an energy crop takes time and harvesting occurs over a number of years, long-term contracts with energy producers are likely to be necessary to make a profit. Long-term contracts also offer greater income stability by allowing farmers to avoid some of the fluctuations of commodity markets.

Another option is for farmers to form a local co-op to produce energy and other value-added products in jointly owned facilities. This approach can increase profits by achieving economies of scale and scope in production and by gaining access to low-cost financing. It can also help improve the viability of family farms and strengthen rural communities by creating new jobs and keeping money in the local economy. This approach has been particularly successful in Minnesota, which provides incentives for small community-based ethanol plants.

For More Information

U.S. Department of Energy
Biopower and Biofuels Programs
www.eren.doe.gov

Institute for Local Self-Reliance
1313 5th Street SE
Minneapolis, MN 55414-1546
(612) 379-3815
www.carbohydrateeconomy.org

National Renewable Energy Laboratory
1617 Cole Boulevard
Golden, CO 80401
(303) 384-6979
www.nrel.gov/biomass

U.S. Department of Agriculture
2002 Farm Bill Renewable Energy Incentives
www.rurdev.usda.gov/rd/farmbill/9006resources.html

Regional Biomass Energy Program
www.ott.doe.gov/rbep/

American Bioenergy Association
209 Pennsylvania Avenue SE
Washington, DC 20003

Center for the Analysis and Dissemination
of Demonstrated Energy Technologies
www.caddet-re.org/technologies/search.php?id=12

BIOMASS is a renewable resource that can be used to generate electricity, heat, or liquid fuels such as ethanol. A successful perennial grass-based bioenergy system requires reliable establishment and persistence, knowledge of optimum cultural and production practices, high yielding cultivars, and appropriate conversion technology. The Conservation Reserve Program (CRP) is a land retirement program established by the Food Security Act of 1985. The main objectives of this program are to reduce soil erosion, reduce commodity surpluses, and to supplement farm income (Jewett et al., 1996). Native warm-season grasses such as switchgrass are permitted for use as permanent vegetation on CRP land. Rather than losing the environmental benefits and converting switchgrass CRP land to traditional crops when contracts expire, the herbaceous material could be used as a biomass feedstock.

“There is discussion about taking land out of CRP land and putting a portion into corn. Currently about 37 million acres are in CRP, but USDA/NRCS considers only about 7 million acres suitable for corn production.”

In the long-term, the United States will need much more than that to meet projected production of 32 million gallons of ethanol annually. “If we are to make ethanol from corn grain, we would need 68 million acres, which is 72 percent of the corn grown in the United States. I doubt very seriously that’s going to happen.”

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Energy crop company Ceres, Inc. announced that it will sow thousands of acres of switchgrass, high-biomass sorghum and other energy crops over the next three years near St. Joseph, Missouri to support a next-generation biorefinery being engineered by ICM, Inc., a leading biofuel process technology provider. The demonstration-scale project, which includes participation from academic institutions, government and other technology providers, will produce fuel, known as cellulosic biofuel, from biomass rather than corn. Last week, Department of Energy officials announced up to $30 million in supplemental funding for the planned facility.

Like sugar materials, starchy materials are also in the human food chain and are thus expensive. Fortunately, a third alternative exists—cellulosic materials. Examples of cellulosic materials are paper, cardboard, wood, and other fibrous plant material.

Cellulosic resources are in general very widespread and abundant. For example, forests comprise about 80% of the world’s biomass. Being abundant and outside the human food chain makes cellulosic materials relatively inexpensive feedstocks for ethanol production.

Cellulosic materials are comprised of lignin, hemicellulose, and cellulose and are thus sometimes called lignocellulosic materials. One of the primary functions of lignin is to provide structural support for the plant. Thus, in general, trees have higher lignin contents then grasses. Unfortunately, lignin which contains no sugars, encloses the cellulose and hemicellulose molecules, making them difficult to reach.

Cellulose molecules consist of long chains of glucose molecules as do starch molecules, but have a different structural configuration. These structural characteristics plus the encapsulation by lignin makes cellulosic materials more difficult to hydrolyze than starchy materials.

Hemicellulose is also comprised of long chains of sugar molecules; but contains, in addition to glucose (a 6-carbon or hexose sugar), contains pentoses (5-carbon sugars). To complicate matters, the exact sugar composition of hemicellulose can vary depending on the type of plant.

Since 5-carbon sugars comprise a high percentage of the available sugars, the ability to recover and ferment them into ethanol is important for the efficiency and economics of the process. Recently, special microorganisms have been genetically engineered which can ferment 5-carbon sugars into ethanol with relatively high efficiency.

One example is a genetically engineered microorganism developed by the University of Florida that has the ability to ferment both 5- and 6-carbon sugars. This microorganism was issued US patent 5,000,000. Other researchers have developed microorganisms with the ability to efficiently ferment at least part of the sugars present.

Bacteria have drawn special attention from researchers because of their speed of fermentation. In general, bacteria can ferment in minutes as compared to hours for yeast.

Much like the human potential biomass as a source of transportation energy is boundless but we must first take the steps to make it such. There are many dedicated organizations putting in the sweat equity required to make this resource a realization in today’s business model. However at what point do we as a society need to jump and calculate the costs at a later date? It is much like the idea of our fore fathers who took the chance to cross the Atlantic to reach a new land with unlimited possibilities with out doing multiple feasibility studies. At some point there needs to be a collective ambition to realize we don’t know the risks of such a venture however with out taking chances we will never know the possibilities of change and will be limited by our established resource, fossil fuel.

Image a business sector that has the ability to transform our everyday existence by replacing our ideas of a limited energy resource but rather take the pioneering spirit that we have an unlimited resource if we only dare to believe in that which we can’t perceive yet! We must create an atmosphere of ingenuity in the energy sector in order to transform the hierarchy of the established business model that has brought us to this day and age.

The question that remains is the risk factor of establishing such a sector who should burden such a risk? Shouldn’t we all take it upon our shoulders to burden this risk? If not, we all stand to lose when market turbulence’s occur and we have no alternative to the status co.

Cellulosic ethanol is a realistic today! We must establish this industry now in order to learn, conserve and adapt.

How can one learn in the laboratory that which must be learnt on a business level? Research and science are aides to business but business is the catalysis which will drive innovation.

The “1 Billion Dry Tons” study has established that there is the potential to displace 30% of our current petroleum usage. Everyday we wait we squander this exhaustible resource. We must take the steps today to replace this energy resource with the energy resource of tomorrow because it will require the energy of today to produce the energy of tomorrow.

Only in the act of doing can we see the processes in action and therefore create the improvements in which we make the process more efficient.

Estimated Costs for Production, Storage and Transportation of Switchgrass

Mike Duffy, extension economist, 515-294-6160, mduffy@iastate.edu

The bioeconomy is the focus of research and discussion as a way to reduce dependence on imported oil, provide some relief from green house gas emissions and increase the use of agricultural products. Biofuels are a significant component of the bioeconomy. Ethanol and biodiesel are the primary biofuels used today.

In the United States, ethanol is primarily produced from corn. However, there is a considerable amount of research and development occurring to develop the capability to produce ethanol from cellulous material.

Switchgrass is one of the major plants considered in discussions of cellulous ethanol. Switchgrass (Panicum virgatum L.) is a perennial warm-season grass native to Iowa. In the past, it has been evaluated as an energy crop but primarily to replace coal. Using switchgrass to produce ethanol is a new use.

This report updates earlier production cost estimates for switchgrass. The earlier estimations were completed as a part of the study using switchgrass to replace coal. This information is available in Iowa State University (ISU) Extension publication Costs of Producing Switchgrass for Biomass in Southern Iowa, PM 1866). For more information on the agronomic aspects of switchgrass production, see the ISU Extension publication Switchgrass (AG 200).

The estimated costs of production are presented here in two sections. The first is the estimated costs. This is followed by a discussion of what could happen if we change the initial assumptions used to estimate the costs. Switchgrass costs are presented in three categories. The first is the production costs, which include establishment, reseeding and annual production. Next are the transportation costs; the final cost category considered here is storage.

Production Establishment

We make several assumptions based on 2001 research findings, with costs updates using 2007 estimates. The Information File 2007 Iowa Farm Custom Rate Survey was used to compute machinery costs. Other costs come from the Information File Estimated Costs of Crop Production in Iowa - 2007. Seed and chemical prices come from expert opinion.

Assumptions
(Note that these assumptions will be relaxed later, but they are used for the illustration that follows)

• The switchgrass is frost-seeded with a 25 percent probability of needing to reseed the stand
• The land charge assumed is $80 per acre
• Switchgrass yield is 4 tons per acre
• The switchgrass stand is assumed to last 11 years
• The reseed is assumed to last 10 years
• The interest rate used for prorating the establishment costs is 8 percent, while the operating interest rate is 9 percent
• Operating costs are assumed to be borrowed for six months
• The field is initially prepared by adding phosphorous and potassium. There is also an application of lime assumed.

It is assumed that a field needs to be reseeded 25 percent of the time. Basic ground preparation and lime are not included for the reseeding.

Assumptions

• A 4 ton per acre yield.
• 100 pounds of nitrogen (N) is used. The herbicides listed are examples. Phosphorus and potassium are at removal rates.
• Harvesting is done in mid to late November. It will be mowed, raked and baled, using a large square baler. Bales are 3×4x8 feet, with a weight of 950 pounds.
• The bottom of Table 3 also presents the total estimated costs for producing switchgrass. Production costs are the sum of the establishment costs, the prorated reseeding costs and the annual production costs.

Storage

Previous studies estimated the costs for storing switchgrass. The options considered include storing in: an open field, an open field on crushed rock covered with a tarp, an enclosed structure, and a pole building with open sides. These studies found that the enclosed building is the most expensive type of storage, but, because maintaining quality of switchgrass is very important for ethanol production, it is the method selected here. (Note that if switchgrass is used as a coal replacement, the quality consideration is not as critical and another storage option might be considered.)

The costs of storing include not only the cost for the facility or method used but also include the value of the switchgrass in storage and dry matter loss associated with the various storage methods.

The estimated storage costs are presented in Table 4 for an enclosed building. (These cost assumptions are relaxed in later discussions.)

Since there are various types of enclosed buildings, we make several assumptions.

Assumptions

• The structure is a tarped hoop type structure and holds 5,454 bales or 2,591 tons.
• Assume a cost of $12 per square foot for the finished building.
• Dimensions are 100×300 feet (30,000 square feet).
• The bales weigh 950 pounds or 0.475 tons and are 3×4x8 feet.
• The bales are stacked 20 feet high or six bales high.
• The building and area are assumed to take two acres. The extra space is for building edging, driveways and turnaround space for semi-trucks.

One issue that is not addressed is who owns the switchgrass while it is in storage. This aspect of the cost of production has not been decided. Therefore, we chose not to estimate it. There are at least two major costs that are not considered because of this decision. First, there is the value of the switchgrass over the time it is in storage. Second, and perhaps more important, is the insurance for the switchgrass and building. Storing this much dry hay could create a fire hazard.

Transportation and Handling

Transportation and storage logistics will vary depending on the situation, so again, we make some assumptions.

Assumptions

• For these estimates, the switchgrass bales are staged along the edge of the field. This cost is included in the production budget. A farmer with a typical tractor and bale fork can perform these duties.
• Another transportation cost is collecting, delivering and unloading the bales into a storage facility. A semi-trailer holding 20 tons (or 42 bales) is used to haul the switchgrass. Estimated times are 30 minutes to load the truck and 20 minutes to unload. The charge for the semi is $70 per hour.
• A typical tractor and bale hauler will not work to stack large square bales 20 feet high. More specialized equipment is needed for this task. Estimated costs of such a tractor were $20 per hour and $10.78 worth of fuel per hour. The operator charge is $12 per hour.

Table 5 shows the estimated transportation costs. These are shown in two categories; field to storage (5-mile trip) and storage to plant (30-mile trip). It is assumed that the unloading will be done at the plant at plant expense.

There are two comments regarding these cost estimates. The loading and travel time to take the semi from field to field and then to a storage facility may be underestimated. It is possible, too, that if enough farmers raise switchgrass, they can haul it to the facilities themselves. This would change the cost estimates. However, the estimates used here present the opinions of several farmers who grow switchgrass.

Table 6 shows the total estimated costs for switchgrass. This includes production, storage and transportation.

Alternative Assumptions

Estimating the cost of producing any crop will vary depending upon the assumptions made. Making assumptions is necessary, however, because we can’t model each individual farm, field, and situation. By varying some of the key assumptions we can determine areas that are the most critical in estimating the costs of production.

The Future

The future of switchgrass production depends upon its potential commercial uses. If switchgrass is used as a feedstock for ethanol, replacement for coal or other technologies, further research is needed to increase yields.

As shown in Figure 1, increasing yield will have the biggest impact on reducing the costs of switchgrass for any energy use.

The Conservation Reserve Program (CRP) may also play a role in the future of switchgrass. If green payments would be added to a switchgrass rotation on CRP land, there would be a larger economic incentive for producers. Switchgrass is a good alternative because it can be grown on marginal land and offers erosion control as well as other environmental benefits.

For switchgrass to become a commercially viable crop, there must be available markets. For cropland, there must be a sufficient economic incentive for producers to change their rotation systems. More efficient harvesting and transportation methods must be adapted to improve profitability. In addition, logistical issues must be addressed and, perhaps most important, the issues of handling and storage must be addressed.

Switchgrass can become a viable bioenergy crop. The engineering is being refined. But, before switchgrass can become viable commercially, key farmer issues must be addressed.