Biomass subsidies

Biomass Electricity: Clean Energy Subsidies for a Dirty Industry

American taxpayers and ratepayers are subsidizing a form of “renewable” energy—biomass electricity- that causes short and long-term harm to the public health and the environment. There are 234 of these so-called “clean and green” biomass electricity projects proposed for the U.S. The scale of these plants ranges from 25 to more than 100 megawatts (MW), often dwarfing the 255 existing biomass power facilities, which generally range from 2 to 5 MW capacity. This polluting form of electricity production currently accounts for over 50% of the so-called “renewable” energy in the U.S.

Natural gas fracking well in Louisiana

I wanted to call attention to an important study released last month by the Manomet Center for Conservation Sciences, prepared for the Massachusetts Department of Energy Resources.  Authored by a study team led by my former colleague Tom Walker, the analysis delves in to the many complicated elements of the biomass fuel chain.  They nicely highlight competing demands for woody biomass on state land, helping to bring a level of sophistication in thinking about biomass power that Tim Searchinger and others brought to the liquid biofuels market a couple of years back. 

In both sectors, it all comes back to land, so a high degree of overlap should not come as a surprise.  Bringing policy (state and otherwise) along to reflect this more complex view of energy solutions may be challenging, but it is high time to begin the process. The approach seems to mark a step forward for how biomass energy is viewed in the state, something I've been critical of in the past.

The report also contains some very good information on subsidies to biomass energy in general, including those on offer through state and regional carbon reduction plans.  Just as federal policies sometimes introduce higher subsidies to a new favored use (e.g., cellulosic production) to outbid federal subsidies already in place (corn ethanol and corn production in general), the table below illustrates how this lunacy could be replicated at the state or regional level. 

Both liquid biofuels and biomass power are subsidized, yet are likely to compete for the same feedstocks. The Manomet study indicates that will take a good $40/ green ton to pull biomass from power markets into liquid biofuels.  Some of this may come from technical improvements.  Most would likely need to come from higher subsidies to cellulosic plants so they can outbid the subsidized biomass electricity producers.

Natural gas fracking well in Louisiana

With the liquid biofuels industry so well organized and so well financed, it is sometimes easy to forget that there are other uses for biomass.  No, not habitat, compost, or food; other subsidized uses.  Like burning it for electricity.

Scott Learn in The Oregonian has a nice summary of the issues brewing over a new plant in Eugene to convert 700 tons per day of logging slash and sawmill waste into electricity.  The plant is owned by Seneca Sustainable Energy, but appears to include some asterisks on the "sustainable" part.  Learn writes:

"The plant features West Coast-leading pollution controls endorsed by the Environmental Protection Agency. It's projected to release far less pollution than the usual practice of burning slash piles in the woods. But it will also release more carbon dioxide and lung-damaging particulates than a comparable coal-fired power plant... It will release more carbon, sulfur dioxide and smog-causing nitrogen oxides than a similar-sized natural gas plant. And it's expected to receive millions in Oregon tax credits and qualify to meet the state's renewable power goals, just like non-polluting solar and wind."

Oh, and it will receive federal tax credits as well.  And if it's anything like ethanol plants, it will likely receive local subsidies to boot in the form of access to tax-exempt debt, tax abatements, and infrastructure improvements. 

The article further notes that

"Supporters, including state and federal leaders, say wood energy is effectively carbon neutral because the carbon emitted in burning it will be balanced by new trees that pull carbon from the atmosphere."

This line of reasoning has the same problems for biomass electricity as it had with liquid biofuels The forests are sequestering carbon before they are cut, so you need to look at whether there is a net increase or decrease in sequestration under the new cutting regime. The cutting changes soil sequestration patterns. And there is that lingering issue of indirect land use should the number of these plants increase substantially.

As the ability to use cellosic biomass for liquid fuels grows, there will be some mighty interesting conflicts brewing over which markets get to strip the land.  Woody biomass for wood, liquid fuels, power, or habitat?  Farm crops for food, feed, or liquid fuels -- with federal subsidies for cellulosic crops needing to be set high enough to out-compete federal subsidies to conventional crops.  Land management decisions will be increasingly driven by subsidy arbitrage rather than sustainable yields and ecosystem protection -- clearly not a good outcome.  Battles are only beginning.