Renewable energy is a triple play: a winning strategy for farmers and ranchers, for the environment, and for America.
Renewable energy is a triple play: a winning strategy for farmers and ranchers, for the environment, and for America.
It is a centerpiece of President Bush’s energy strategy as we seek to reduce our dependence on imported oil. It creates exciting new market opportunities for farmers. And in many applications—including anaerobic digesters—it yields significant environmental benefits.
For all these reasons, the United States Department of Agriculture (USDA) is committed to clean, domestically-produced renewable energy, and we look forward to dramatic growth in this area in the years ahead.
For the USDA, renewable energy involves a broad range of technologies, both on and off the farm. I have long been committed, along with President Bush, to increase the opportunities to utilize renewable and bio-based products, such as ethanol, biodiesel and the harnessing of wind and solar to generate electricity to bring greater energy independence to America. We understand that a kilowatt saved is as valuable as a kilowatt produced, and we emphasize energy efficiency across the board in our utilities, housing, and business programs. Renewable energy, in short, is nothing new to the USDA.
But in 2002, President Bush moved his comprehensive energy strategy forward through support by the Congress to strengthen the 2002 Farm Bill to include for the first time an energy title. Section 9006 of the 2002 Farm Bill —the Renewable Energy Systems and Energy Efficiency Improvements Program—set aside a special, dedicated funding stream to support qualified energy efficiency and renewable energy projects. To date, over $44 million in grants have assisted in this effort. For fiscal year 2005, $22.8 million, half allocated to the grant program and the other half to support a new guaranteed loan program, will further this effort.
Anaerobic digesters are among the most promising of the eligible technologies, and dairy and hog producers represent over 90 percent of the market. Digesters use bacteria to break down manure in an oxygen-free environment. Biogas is then recovered and used to generate electricity. Whether used on the farm or sold back to the local utility, this turns processed manure into a profit center for farmers—and the higher energy prices go, the greater the benefit.
Energy savings, of course, are not the whole story. This technique also saves farmers the handling costs of conventional liquid and slurry management systems. It reduces ammonia loss, so the digested manure contains more nitrogen for fertilizer. With its high fiber content, it is also valuable as bedding material or a high-quality soil ingredient or mulch. Last but not least, anaerobic digesters are popular with the neighbors because they minimize odor and other air and water quality impacts.
These are significant advantages for farmers, provided the numbers add up on the bottom line. Increasingly, they do. Given today’s high energy prices and with current technology, digesters typically require a herd of 2,000 pigs or 300 dairy cows to become economical. A grant or loan guarantee from the USDA can significantly reduce the economic threshold.
While relatively new, the program results are starting to come in. When it began, only about 40 biogas recovery projects were in operation nationwide. In the first two years, roughly $17 million in grant funds were awarded to an additional 67 systems in 12 states. When completed, these anaerobic digesters will be capable of producing up to 350 million kWh annually, enough to power 35,000 homes. And that’s just the start.
These projects only begin to tap the potential of this technology in rural America. To encourage producers to explore this option, the USDA has teamed with the AgSTAR program at the US Environmental Protection Agency to provide information and tools for evaluating and implementing these systems. To get further information on biogas recovery systems, including whether these technologies are right for your farm and how to locate vendors, contact the AgSTAR program at 1-800-95-AgSTAR or at www.epa.gov/agstar. To access details on the USDA 9006 Program and how it could provide financial support for your project, go to www.rurdev.usda.gov/rbs/farmbill/.
Turning problems into opportunities—turning waste into energy—is a great way to do business. At the USDA, we recognize that renewable energy is one of the major strategic opportunities opening up to American farmers and ranchers today. It won’t happen overnight. But it is happening, and the USDA will continue to work to make this important opportunity accessible and affordable. We’re just a phone call or a click away. We look forward to hearing from you.
Gilbert Gonzalez is Acting Under Secretary, USDA Rural Development.
