Sustainable bioenergy and community economic development

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  • 1. Sustainable Bioenergy andCommunity Economic Development Thomas G. Johnson Presented April 11, 2012 Columbia, Missouri
  • 2. Introduction• What does the emerging bio-economy mean for community and regional economies?• How can community leaders and businesses take full advantage of the biomass-based economy?
  • 3. Energy—Past, Present and FutureEnergy in the past was almostentire renewable …and almost entirely rural-sourcedSource: ukurbansurvival.com Source: safran-arts.com
  • 4. Energy—Past, Present and Future BiomassSource: ukurbansurvival.com Source: somethingawful.com
  • 5. Energy—Past, Present and Future WindSource: ukurbansurvival.com Source: lampusuluh.blogspot.com
  • 6. Energy—Past, Present and Future Hydro Source: wikipedia
  • 7. Yesterday’s Energy Was:• Distributed• Mostly renewable• Collected in rural areas BUT• Low energy conversion efficiency• Unsustainable at today’s levels of demand
  • 8. Energy—Past, Present and Future Today’s energy is very different Coal Petroleum Hydro NuclearSources: Mineengineer.com BTGWord.com usbr.gov Scientificamerican.com
  • 9. Today’s Energy Is:• Spatially concentrated – Oil refineries – Coal
  • 10. Today’s Energy Is:• Spatially concentrated• Mostly nonrenewable• Very large scale
  • 11. Today’s Energy Is:• Spatially concentrated• Mostly nonrenewable• Very large scale• Still rural• Higher, but still low energy conversion efficiency• Frequently environmentally damaging• Unsustainable at tomorrow’s levels of demand
  • 12. Bioenergy—Back to the Future
  • 13. The First Flex-Fuel Vehicle (1908)
  • 14. Energy—Past, Present and Future 100 years ago these were ‘hay burners’ Source: prinsviewbelgians.com
  • 15. Energy—Past, Present and Future Today, this is a ‘hay burner’ Source: tootoo.com
  • 16. Today’s Refinery
  • 17. Tomorrow’s Refinery energydescentplanning.blogspot.com
  • 18. Tomorrow’s Energy Is:• Still rural• Renewable• High energy conversion efficiency• Environmentally sound• More sustainable• Much more distributed
  • 19. Energy—Past, Present and Future From the concentrated To a distributed non-renewable energy renewable energy economy economy
  • 20. Non-renewable to Renewable Energy• In the non-renewable energy economy – rural residents pay transportation costs in both directions – they receive less when they sell commodities and pay more when they buy consumer goods• In the renewable energy economy – energy is less expensive in rural areas – a competitive advantage for rural areas
  • 21. With Distributed Renewable Energy• Waste streams become energy sources• Rural firms no longer bear high costs of transporting their energy inputs (diesel, gasoline, and electricity)• Rural farms no longer bear high costs of transporting all their biomass to distant markets• Rural areas are more attractive to energy using industries• Rural consumers save on locally produced energy and commodities
  • 22. Distributed Energy Technologies Anaerobic Digestion Farm-scale Even mobile unitsSource: wbcarbonfinance.org Source: sustainabletech.cc
  • 23. Distribute Energy Technologies: Biomass Dedicated Crops Crop ResiduesSource: farmindustrynews.com Source: biomassmagazine.com
  • 24. CHP power station in Denmark burns straw as fuel. The adjacent greenhouses are heated from the plant
  • 25. Advantages of Distributed Energy Systems• Up to some level, transmission costs are reduced• Reduced need for transmission lines and right-of- ways• Greater possibilities of exploiting combined heat and power (CHP)• Greater reliability when part of smart grid• Reduced emissions• Increased energy efficiency
  • 26. Consequences of the Emerging Bioeconomy• Most rural areas will switch from net energy consumers to net energy suppliers• Energy costs will decline in many rural areas• More energy dependent sectors will locate in rural areas• More rural economies will become energy dependent
  • 27. Some observations about the bioenergy sector and community development• Bioenergy refineries and related sectors increase employment and income in local economies• Like most modern sectors, employment in bioenergy is not high but highly paid and stable
  • 28. Least cost sources of biomass • 18 types of local biomass • Capital costs • Transportation & handling costs • Energy & moisture content • Electricity costs • Other revenue sources
  • 29. Model Output • Least cost biomass• t sources • Transportation & other costs • Revenues • Financial indicators • Economic impact indicators
  • 30. Other Community Economic Impact Studies and Tools• Wisconsin’s Community Impact of Biodiesel and Bioethanol Plants http://www.aae.wisc.edu/renk/impactcalculator.asp• Low, S. A. and Isserman, A. M. (2009). ”Ethanol and the local economy: Industry trends, location factors, economic impacts, and risks.” Economic Development Quarterly, 23(1): 71–88.• Hodges, Alan W., Thomas J. Stevens and Mohammad Rahmani. 2010. Economic Impacts of Expanded Woody Biomass Utilization on the Bioenergy and Forest Products Industries in Florida. http://www.floridaforestservice.com/forest_management/fm_pdfs /Final%20Report%20on%20Economic%20Impacts%20of%20Woody %20Biomass%20Utilization.pdf• Swenson, David. 2008. The Economic Impact of Ethanol Production in Iowa. Iowa State University. http://www2.econ.iastate.edu/research/webpapers/paper_12865. pdf
  • 31. Myths about Bioenergy & Community Economies1. Impacts are greater when locally owned – Depends on rate of return – Profits are repayment for investment and risk – Local ownership may exploit place-based knowledge2. Producers benefit more if producer owned – See points above – Producers benefit when they sell at the highest price and make sound investments
  • 32. Thank you