Juliet Eilperin of the Washington Post reports on how a Federal subsidy program for biomass energy threatens an existing industry that relies on that same material for producing wood products:Expect plenty more such stories as incentives for energy production and consumption are changed. You can't make a clean energy omelet without breaking a few eggs.It sounded like a good idea: Provide a little government money to convert wood shavings and plant waste into renewable energy.
But as laudable as that goal sounds, it could end up causing more economic damage than good -- driving up the price of raw timber, undermining an industry that has long used sawdust and wood shavings to make affordable cabinetry, and highlighting the many challenges involved in decreasing the nation's dependence on oil by using organic materials to create biofuels.
In a matter of months, the Biomass Crop Assistance Program -- a small provision tucked into the 2008 farm bill -- has mushroomed into a half-a-billion dollar subsidy that is funneling taxpayer dollars to sawmills and lumber wholesalers, encouraging them to sell their waste to be converted into high-tech biofuels. In doing so, it is shutting off the supply of cheap timber byproducts to the nation's composite wood manufacturers, who make panels for home entertainment centers and kitchen cabinets. . .
The federal government can provide up to $45 a ton in matching payments to businesses that collect, harvest, store and transport biomass waste to an authorized energy facility. That means sawdust or wood shavings may be twice as valuable if a lumber mill sells them to a biomass energy company instead of to a traditional buyer.This is bad news for the composite panel industry, which turns these materials into particleboard and medium-density fiberboard, and outranks the U.S. biomass industry in terms of employees and economic impact, with 21,000 employees and annual sales of $7.9 billion, according to 2006 U.S. Census data.
The biomass subsidy program could "wipe us out," said T.J. Rosengarth, the vice president and chief operating officer of Flakeboard, the largest composite panel producer in North America. "You can say, 'I've made more alternative energy,' but at what expense?"
The much larger pulp, paper, packaging and wood products industry, which ranks among the top 10 manufacturing employers in 48 states, is just as worried. The American Forest and Paper Association sent a letter to OMB on Oct. 27 warning that the biomass program "could have the unintended consequence of jeopardizing the forest products industry and the many jobs it sustains, as well as the significant quantities of renewable energy it produces."
8 comments:
Ah,but there are only composite panel industries in some states and not (many) others; there are sawmills in many states but supply is not really a problem in many areas. Woody biomass economics is almost all about transportation to the site of use..
Energy production and consumption tradeoffs tend to be regional or local, based on biomass availability and competing uses for that biomass. You can't just take one situation and extrapolate to the rest of the country/planet.
This is just a small part of a big problem with Cap and Trade and/or Tax and Subsidize:
There are 'good' biofuels – and there are 'bad' biofuels – and everything in between.
Biofuels have been prime candidates for subsidies or tax credits to help ‘cure’ AGW . But biofuels (for example, wood, corn-ethanol and palm-nut diesel oil) can contribute to mitigation of AGW ONLY if they have smaller footprints than the fossil fuels that they are intended to replace. The growing plants that serve as their sources, capture and store CO2 naturally. The annual net rate of conversion of CO2 to organic carbon by the (original, o) plants that grew on the land, before it was brought under cultivation (NPPo), can have been larger or smaller than that of the biofuel crop (new, n) that replaced them (NPPn). If larger, cultivation of such biofuel will produce a net INCREASE in atmospheric CO2, a positive CO2-footprint, proportional to such difference (NPPo - NPPn). Therefore, the production and sale of positive CO2-footprint biofuels should be treated like the sale of fossil fuels; they should be ‘taxed’, not subsidized! A tax, proportional to each such difference must be assigned to the harvest/sale of such ‘bad’ biofuels. Otherwise, market forces will incorrectly, (or dishonestly) favor deforestation and land ‘abuse’ to promote the production of such bad but ‘profitable’ biofuels (to game the system). This would cancel – instead of contributing to – efforts to mitigate climate change (and incidentally undesirably compete with the production of food or, as in the case being discussed, construction use of wood and wood products).
If harvested wood has a replacement rate by new wood, at or ‘near’ the harvest site, that is at least equal to the harvest rate, its footprint remains negative if it's either stored, used in construction or as feed stock for chemical synthesis or is used to replace fossil fuel in existing (or replacement) power plants. If it's burned in a new power plant, that increases total energy output, its footprint is still near zero; that is, it produces net energy but little net CO2 emissions! This provides a guide as to how it might be either taxed or subsidized, with respect to fossil fuels.
Assessment of taxes on bad biofuels, as well as the assessment of appropriate taxes on fossil fuels, subsidies for negative-CO2-footprint fuels and subsidies for other conservation activities have to be made from a global and long-term-, rather than a local, short-term-perspective – and with social and ecologic motivation – in a global regulatory arena. The total required tax revenue must be calculated to try to optimize the distribution of economic motivation among the 'players'.
Of course, this is entirely unlike currently discussed Cap and Trade or Tax and Subsidize strategies. But without it, continued deforestation and land abuse and increasing CO2 emissions are assured.
"If harvested wood has a replacement rate by new wood"
USDA and DOE did some estimates in 2005. Biomass from trees could increase from 142 million tons per year to 368 million tons per year without sustainability issues.
http://feedstockreview.ornl.gov/pdf/billion_ton_vision.pdf
Of course the heat content of wood is 1/2 that of coal. So there is a potential to replace 113 million tons of coal with 226 million tons of wood.
Len- I have to raise an issue that again echoes the contrast between some science communities and others who work at a local scale. To paraphrase Shakespeare "There are no biofuels either good or bad but that specific situations make them so."
Let's take dead bark beetle killed trees, and yard waste for examples. Neither source of biomass changes land use. BB killed trees are not managed; the land has not been converted from forests; there have been no inputs to those forests.
We are going to remove dead trees to reduce fuels around urban areas and to keep them from falling on people and cars. We have a choice; we can either use them for something (fuels or products) or pile them and burn them on site. So the only added carbon is that associated with moving them off site and doing something with them. And that carbon has to be compared to that released if they are burned on site.
Another example is yard waste. It is already collected. It is a question of putting it in a landfill or making mulch or using it to replace fossil fuel.
Again, there is the question of the carbon comparison of moving it and using it for fuel compared to moving it and whatever else you would do with it.
It seems like people tend to get stuck on the biomass as growing biomass crops on agricultural land and forget that woody biomass is a product of existing land uses.
Another point that is missed here. Composite board products represent a carbon sink.
If I look at the USDA biofuels report. There is a total of 9.8 million tons of 'yard waste'. Of which 8 million tons is either already being burned as a fuel or is unusable. Which leaves 1.7 million tons as a potential.
2/10ths of 1% of the proposed bio fuels.
It depends on how you think about it.. are biofuels a good thing in some cases- then what difference does it make what proportion of the total it is? We don't have a biofuels target that I know of- but we would use biofuels where it makes sense and then let the chips (so to speak) of the total woody biomass as energy fall where they may.
The issue is that 'good' biofuels create a market. Unless the distinctions between 'good' and 'bad' biofuels are made explicit, out of profit motivation, markets will be 'gamed' and forests destroyed!
'Taxing' 'bad' biofuels is one solution.
Post a Comment