How agriculture plugs in to renewable energy is emerging as the next decade’s highest-voltage source of farm successes (and failures)
He knows how fateful the decisions will be, so Murray Logan pauses during a rare lunch break away from the pressures of pulling together the Canadian Energy Expo, a job he throws himself into with an almost missionary zeal.
“There isn’t any one-size-fits-all answer,” Logan says. “There isn’t one, and there isn’t going to be one, not any time soon.”
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Logan chooses his words carefully. “Sure, the technology sounds great, and I agree the long-term future of renewable energy has got to be good for agriculture, but there’s a lot of work — and a lot of risk — between here and there.”
Logan is a believer in renewable energy. The expo that he launched three years ago is now part of the Canada Outdoor Farm Show in Woodstock, Ont., and it is sponsored by Toyota, one of the biggest players in farm trucks. This year’s expo will also have 60 major manufacturers and exhibitors, three times as many as last year.
As Logan runs through a checklist of those exhibitors, he talks about innovation after innovation, from new developments in biodigestors and wind tubines to stunning breakthroughts in solar energy.
Renewable energy can be a market, Logan says, generating new income streams for farmers linking into wind farms or producing corn or other substrates for ethanol. Or it can cut production costs, or it can extract new value from straw or manure, or it can do all three.
However it’s used, green energy promises to generate more income per farm so that — certainly within the next decade — farmers who succeed at adapting the new technologies to their farms will be outcompeting their non-energy neighbours.
But it won’t be a happy story for everyone. “The guys who got into wind energy too early, who believed all the things that were said about selling excess energy into the grid, they really paid the price,” Logan says. “There’s a lot to learn from them.”
Just three generations ago, Canada’s farms were energy self-sufficient. Yet by 2007, the energy in fuel, utilities and fertilizers accounted for more than 20 per cent of Canadian farm operating expenses.
By 2007, farmers were spending $7 billion a year on energy, an amount that’s forecast to rise sharply. Almost as tough as the price hikes, though, is their volatility. Every one-cent increase in the cost of a litre of gasoline imposes an extra $28 million in costs on Canada’s farmers, and for every penny per kilogram that fertilizer prices go up, farmers spend another $66 million.
More than any other input cost, volatile energy prices
threaten to make today’s farming practices unsustainable. But cost isn’t the only issue that farmers will be called on to tackle.
Diminishing supplies of fossil fuels, legislated limits on greenhouse gas emissions and the move to a global carbon economy will all dramatically affect energy dynamics, even without any negative fall-out from public debates over whether farmers should use cropland for energy production.
Challenge
How much change can you handle?
For Mark Stumborg, engineer at the federal Semiarid Prairie Agricultural Research Centre in Swift Current, Sask., it adds up to simple conclusion. Within the next 10 to 15 years, Stumborg says, farmers must re-invent the way they run their farms.
Indeed, those changes are already starting to take hold, says Jason Price, energy specialist for the Alberta Agriculture and Rural Development (AARD). “Farmers are starting to focus on energy efficiency,” Price says. “Farmers know energy prices are going up, so they are looking for ways to reduce their energy use.”
Price points out there are already some proven early winners in energy reduction. Solar heating of water for dairy barns has been very successful, and chicken farmers find solar walls can significantly reduce their costs of heating their barns.
The first step in saving energy is to know where energy losses are occurring. Price recommends having an energy audit to determine how much energy is actually being lost on the farm and to identify areas where energy savings are possible. An energy audit also qualifies the farmer for federal and provincial rebates for money spent on actions to reduce those losses. An example of an action an energy audit may identify would be retrofitting a barn with new, high-efficiency fans.
Second, Price suggests any farmer contemplating new construction should be comparing building components for their energy efficiency. Programs such as Energy Star provide farmers with a method of comparing energy usage. Price adds there may even be government incentives available for investing in energy efficiency in new construction projects.
“There is value in awareness of energy usage” concludes Price. As an example, he points to a study where consumers in Europe were given meters which showed the exact cost of using electricity at any given time. The consumers dropped their electrical bill by 25 to 30 per cent simply by choosing not to use power at times in the day when they could see the spot price of power was the highest.
While many farms are already reducing energy usage, there is also growing interest in micro-generating power by tapping wind, solar and geothermal energy to offset energy they use on the farm, says Kelly Lund, AARD engineer.
The technologies already exist, and they’re coming down in price, so it’s starting to get realistic for farmers to at least think about generating enough electricity to offset the amount they consume, or even to generate excess electricity to sell to the grid.
But there’s still a hurdle ahead. Governments need to adopt regulations that give farmers a more secure financial footing (See sidebar page 36). In fact, Lund believes it’s those regulations that will determine when on-farm energy production really takes off, not the technology itself.
When will that happen? Lund feels 10 years is possible, but is likely on the early side.
“What we are seeing is growing on-farm opportunities for energy offsetting to occur because of regulatory changes,” Lund says. “Governments are starting to get rid of some of the red tape.”
Challenge
Competing against the big boys
What really stirs the imagination of most farmers are huge new energy markets for farm commodities and large farmer-owned energy plants, so owning a farm will become like owning an oil company, only better because the globe will also experience surging food demand.
Unfortunately, the high investment costs required, plus the volatility of energy and agricultural commodity prices, can mean bioenergy is risky business — too risky for farm money. Few farmer energy coops have the size and management skills to compete in the global energy industry. And while we likely will continue to see investment in and production of biofuels, most will likely be owned and operated by traditional energy producers. Farmers will simply supply the raw commodity needed for energy generation.
Ethanol is the prime example of this trend. While there has been a major building boom of ethanol plants in North America over the last decade, the recent collapse of fossil fuel prices and high agricultural commodity prices have resulted in more than 15 per cent of these plants closing or going bankrupt in the last year alone — some before they even got into production.
In the U. S., it’s estimated that two billion gallons of ethanol capacity has been idled, nearly 20 per cent of the national total, and a disproportionate amount of this is at relatively small, farmer-owned, co-operatives (although even VeraSun, the world’s largest ethanol producer failed).
Still, current U. S. production of 10 billion gallons of ethanol per year is significant, and most proponents expect it triple over the next 15 years. So there will be a demand for grains to feed the ethanol facilities which rely on corn and wheat and barley. This need will continue to provide a market for a significant amount of course grains in the future.
Challenge
Picking the right energy crop
Most experts feel new investment in infrastructure for ethanol production will focus on new types of feedstock. Cellulosic ethanol is the direction the industry is moving now. Instead of using food grains, ethanol will be produced from crop residues, wood, and perennial grasses such as switchgrass. Farmers wanting to target the future ethanol market would therefore have to look at additional equipment to handle crop residues or forages.
Biodiesel sources may also change. Rather than utilizing food-grade oilseeds, tomorrow’s biodiesel plants maybe built to handle new, non-food oilseed crops.
Anaerobic digestion provides a number of benefits to the agricultural sector besides energy production. Anaerobic digestion converts manure and agricultural waste into biogas which can be utilized as a fuel for electrical generation. The digestion process also reduces odour, utilizes and controls waste water, and yields a marketable fertilizer product. There are already a number of digesters utilizing the liquid manure from hog
farms in the U.S. and Canada. Highmark Renewables of Vegreville Alberta is operating a prototype of a digester which utilizes the solid manure generated by a beef feedlot and hopes to market this technology across North America.
Challenge
Backing the right technologies
The drawback to anaerobic digesters is the initial cost. While they may be cost effective for a large, confined livestock operation, they have limited value for the average Canadian farm operation. Stumborg sees the potential for groups of livestock owners and small rural communities combining to build a central digester which provides power for the community and local area. This type of co-operative power generation from manure has been used successfully in Europe for years.
Wind power is likely still the best option for large-scale renewable energy generation in rural areas. Large wind turbines can generate significant amounts of power with little disruption to food crop production around them. Leases for turbine placement can add a secondary income to a farm operation. As a result we are seeing massive wind farms being built across North America.
Wind is the one renewable which may offer individual farmers the chance to become major energy producers. In 2001 Tjaden Farms of Iowa diversified their grain farm by adding a confinement hog operation. The hog barn added about $600 per month to their electrical bill. The Tjaden family decided to try to offset that added cost by adding a 65 KW wind turbine to their farm operation.
Upon investigation, Scott Tjaden found the bigger the turbine, the better return on their investment. He found a used 450KW wind turbine in California. Tjaden had the turbine trucked to Iowa and erected on a high point on their farm. The power generated by the turbine is sold into the grid. While the amount of power generated has not met initial expectations, Tjaden said the investment in the turbine was a good decision and one he would do again. In fact, Tjaden said he would consider adding a second turbine to his farm in the future should another used wind turbine become available.
Challenge
Guessing where government regulations will go
Where agricultural energy production will be 10 years from now is as much dependant upon global policy as it is on fossil fuel prices. The lack of governmental agricultural policy addressing renewable energy has really left this sector in limbo in Canada. While there is strong verbal support for renewable energy, this is not backed up by a co-ordinated government effort or funds to get this industry established.
Even the Canadian Federation of Agriculture does not have a policy for renewable energy production on farms. Greg Northey, CFA director of environment policy, says they are in the process
farms in the U.S. and Canada. Highmark Renewables of Vegreville Alberta is operating a prototype of a digester which utilizes the solid manure generated by a beef feedlot and hopes to market this technology across North America.
Challenge
Backing the right technologies
The drawback to anaerobic digesters is the initial cost. While they may be cost effective for a large, confined livestock operation, they have limited value for the average Canadian farm operation. Stumborg sees the potential for groups of livestock owners and small rural communities combining to build a central digester which provides power for the community and local area. This type of co-operative power generation from manure has been used successfully in Europe for years.
Wind power is likely still the best option for large-scale renewable energy generation in rural areas. Large wind turbines can generate significant amounts of power with little disruption to food crop production around them. Leases for turbine placement can add a secondary income to a farm operation. As a result we are seeing massive wind farms being built across North America.
Wind is the one renewable which may offer individual farmers the chance to become major energy producers. In 2001 Tjaden Farms of Iowa diversified their grain farm by adding a confinement hog operation. The hog barn added about $600 per month to their electrical bill. The Tjaden family decided to try to offset that added cost by adding a 65 KW wind turbine to their farm operation.
Upon investigation, Scott Tjaden found the bigger the turbine, the better return on their investment. He found a used 450KW wind turbine in California. Tjaden had the turbine trucked to Iowa and erected on a high point on their farm. The power generated by the turbine is sold into the grid. While the amount of power generated has not met initial expectations, Tjaden said the investment in the turbine was a good decision and one he would do again. In fact, Tjaden said he would consider adding a second turbine to his farm in the future should another used wind turbine become available.
Challenge
Guessing where government regulations will go
Where agricultural energy production will be 10 years from now is as much dependant upon global policy as it is on fossil fuel prices. The lack of governmental agricultural policy addressing renewable energy has really left this sector in limbo in Canada. While there is strong verbal support for renewable energy, this is not backed up by a co-ordinated government effort or funds to get this industry established.
Even the Canadian Federation of Agriculture does not have a policy for renewable energy production on farms. Greg Northey, CFA director of environment policy, says they are in the process
of developing a policy on renewables and he hopes one will be in place by the end of the year.
Stumborg believes long-term investment is needed now in renewable energy research. Such investment could result in farmers having the knowledge to manage shelterbelts; not only for soil protection but also for harvesting those trees for energy production. He sees the potential for new crops designed specifically for energy production. He says there is the potential for growing energy crops on marginal land, on saline soil, and even on brownfield and industrial sites where the plants destined for the energy market would safely absorb the accumulated heavy metals and contaminates, thus reclaiming the soil for food production in the future.
Still, farms are businesses and if fossil fuel prices continue to rise, they will see a huge potential for renewable energy from agriculture. The technology for renewable agricultural energy production is already available, innovative farmers are already looking at investing in renewables, and a significant number of farmers will be farming crops, the wind, and the sun for energy 10 years from now.
A fact sheet written by the Union of Concerned Scientists states: “Biomass currently provides about two per cent of America’s electricity and one per cent of the fuel used in cars and trucks…”
It goes on to say that with new energy crops and better conversion technology there is the potential for agriculture to “…provide 14 per cent of U. S. electricity use or 13 per cent of the nation’s motor fuel.”
Perhaps the biggest challenge of all in renewable energy is the boldness of the vision. With billions of dollars on the table, the question is: Willfarmersreapthebenefits, orthebiglawyer-drivencompanies? Cg
of developing a policy on renewables and he hopes one will be in place by the end of the year.
Stumborg believes long-term investment is needed now in renewable energy research. Such investment could result in farmers having the knowledge to manage shelterbelts; not only for soil protection but also for harvesting those trees for energy production. He sees the potential for new crops designed specifically for energy production. He says there is the potential for growing energy crops on marginal land, on saline soil, and even on brownfield and industrial sites where the plants destined for the energy market would safely absorb the accumulated heavy metals and contaminates, thus reclaiming the soil for food production in the future.
Still, farms are businesses and if fossil fuel prices continue to rise, they will see a huge potential for renewable energy from agriculture. The technology for renewable agricultural energy production is already available, innovative farmers are already looking at investing in renewables, and a significant number of farmers will be farming crops, the wind, and the sun for energy 10 years from now.
A fact sheet written by the Union of Concerned Scientists states: “Biomass currently provides about two per cent of America’s electricity and one per cent of the fuel used in cars and trucks…”
It goes on to say that with new energy crops and better conversion technology there is the potential for agriculture to “…provide 14 per cent of U. S. electricity use or 13 per cent of the nation’s motor fuel.”
Perhaps the biggest challenge of all in renewable energy is the boldness of the vision. With billions of dollars on the table, the question is: Willfarmersreapthebenefits, orthebiglawyer-drivencompanies? Cg
