The Distributed Energy Blogs

I’ve avoided discussing biofuel in the past not only because of its tenuous connection to onsite power, but also because the amount of resources needed for many biofuel crops (including soil and water) appear to negate their associated benefits. But what if biomass could be directly linked to onsite power with the intent of creating a localized, distributed energy system? After all, biomass does not just involve biofuel crops, but mill wastes, urban wastes, forest residues, and agricultural residues. And throughout the country, waste-to-fuel options continue to remain significantly under-utilized.

Last month, the Wisconsin Department of Agriculture, Trade, and Consumer Protection released a Program on Agricultural Technologies (authored by Gary Radloff, director of policy and communications with the Wisconsin Department of Agriculture, Trade, and Consumer Protection, and Alan Turnquist, outreach specialist at the Program on Agriculture Technology Studies at the University of Wisconsin-Madison) entitled “How Could Small Scale Distributed Energy Benefit Wisconsin Agriculture and Rural Communities.” According to the study, by enacting policies designed to encourage “small-scale renewable energy solutions,” Wisconsin’s agricultural sector and rural communi­ties could be uniquely poised to capitalized on the state’s 15 million tons of potential biomass for energy. The study concludes that “local energy production represents an important enough part of our state’s economic future that new policy steps should be crafted to assure that the economic and energy returns go to rural Wiscon­sin residents, and that groups undertaking distributed energy projects are able to manage risk in the nascent bioenergy market.” 

Ultimately, the hope is that by focusing on small-scale energy systems, Wisconsin can achieve the goal of increasing renewable energy sources, while at the same time overcoming some of the difficult logistics involved in creating a large-scale, centralized system. Based in part on location and in part on the massive amount of potential biomass available, Wisconsin is uniquely poised to capitalize on a biomass-based, distributed energy system. Additionally, the new federal Biomass Crop Assistance Program will allow for payment of up to 75% of implementation costs (costs to convert land from its existing use to an energy crop). This funding could assist agricultural producers to make the switch to biomass not just through dedicated biofuel crops, but also by supplying forest waste for energy. 

The report itself is quite clear when it comes to the benefits of creating a system based on localized renewable energy in a rural setting. “Studies and real-world examples indicate that a com­bination of technology options including biomass for heat, biomass for combined heat and power at small to mid-size businesses, fuels for schools and local government buildings, anaerobic digesters, and small to mid-size ethanol plants can provide economic effi­ciency and diversity when located in rural settings.” What is particularly striking, is that the study highlights the idea that onsite power from renewable energy sources does not have to exist solely to supplement the grid. By promoting biomass as an energy source in rural areas, the communities would be able to move beyond merely energy suppliers for the grid and, instead, integrate the source into their own localized system in order to meet their own needs. In that scenario, everybody wins—“constructing a system where a portion of the renew­able energy dividend stays at home, and the long-term economic benefits are shared by the landowner, farmer, forester, or local community, is quite possible.”

As to implementing and funding this type of project, the study looks to Europe for answers. The study points out that in Germany, Denmark, and other European nations, renewable energy buyback programs—those that guarantee reasonable payment rates by utilities to small renewable energy producers who “feed energy into the electric grid”—have “transformed Germany, Denmark, and other European countries to renewable energy powerhouses.” These renewable buyback (or tariff programs) can even the playing field for renewable systems by providing “long-term investment security” for communities, businesses, and local governments—thereby helping to justify the initial investment and financial commitment required for the creation of a local renewable energy infrastructure, because “investors can literally take the guaranteed tariff payback rate to the bank as a revenue stream for long-term financing of renew­able energy projects.” Several states, including California, Minnesota, Michigan, and Illinois, either already have similar tariff programs in place or plan to implement them within the next couple of years.

So what do you think?  Is the idea of harnessing biomass for a rural distributed energy system worth it? Could other ag-heavy states (like Indiana and Iowa) find similar ways to capitalize on their own biomass resources?