1. Sustainable Bioenergy and
Community 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 Future
Energy in the past was almost
entire renewable …and almost entirely
rural-sourced
Source: ukurbansurvival.com Source: safran-arts.com

4. Energy—Past, Present and Future
Biomass
Source: ukurbansurvival.com Source: somethingawful.com

5. Energy—Past, Present and Future
Wind
Source: 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 Nuclear
Sources: 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 units
Source: wbcarbonfinance.org Source: sustainabletech.cc

23. Distribute Energy Technologies:
Biomass
Dedicated Crops Crop Residues
Source: 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

29. Least cost sources of biomass
• 18 types of
local biomass
• Capital costs
• Transportation
& handling
costs
• Energy &
moisture
content
• Electricity
costs
• Other revenue
sources

30. Model Output
• Least cost
biomass
• t sources
• Transportation
& other costs
• Revenues
• Financial
indicators
• Economic
impact
indicators

31. 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

32. Myths about Bioenergy & Community
Economies
1. Impacts are greater when locally owned
– Depends on rate of return
– Profits are repayment for investment and risk
– Local ownership may exploit place-based
knowledge
2. Producers benefit more if producer owned
– See points above
– Producers benefit when they sell at the highest
price and make sound investments

33. Thank you