I
Introduction and Overview

On June 23 and 24, 2009, the National Research Council’s Roundtable on Science and Technology for Sustainability (“Roundtable”) hosted the workshop “Expanding Biofuel Production: Sustainability and the Transition to Advanced Biofuels—Lessons from the Upper Midwest for Sustainability” in Madison, Wisconsin. Organized by a steering committee, the workshop was attended by approximately 75 people representing academia, state government, nongovernmental organizations, the business sector, and federal agencies. It was organized around the following topics: policy drivers for the expansion of biofuels; the state of biofuel technologies; the economic, environmental, and social dimensions of sustainability, as related to biofuels; the business of biofuels; tools and indicators for decision makers; and ongoing research related to biofuels and sustainability. Breakout sessions examined lessons learned from the experience with producing corn-based ethanol, the potential impacts of next-generation fuels, and future challenges and opportunities. Throughout the workshop there was substantial discussion about uncertainty—when will next-generation fuels be available at commercial scale; what are the most likely feedstocks and where will they be grown; does ethanol represent the best fuel for the future U.S. transportation system, or are other energy sources, including other bio-based fuels, potentially more sustainable; can policy inconsistencies at both federal and state levels be resolved to support sustainability objectives; how can changes in land use be included as a cost of production; and what are the long term consequences for scarce water resources, ecosystems services, and local communities?



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I Introduction and Overview On June 23 and 24, 2009, the National Research Council’s Roundtable on Science and Technology for Sustainability (“Roundtable”) hosted the workshop “Expanding Biofuel Production: Sustainability and the Transition to Advanced Biofuels—Lessons from the Upper Midwest for Sustainability” in Madison, Wisconsin. Organized by a steering committee, the workshop was attended by approximately 75 people representing academia, state government, nongovern - mental organizations, the business sector, and federal agencies. It was organized around the following topics: policy drivers for the expansion of biofuels; the state of biofuel technologies; the economic, environmental, and social dimensions of sustainability, as related to biofuels; the business of biofuels; tools and indicators for decision makers; and ongoing research related to biofuels and sustainability. Breakout sessions examined lessons learned from the experience with producing corn-based ethanol, the potential impacts of next-generation fuels, and future challenges and opportunities. Throughout the workshop there was substantial discussion about uncertainty—when will next-generation fuels be available at commercial scale; what are the most likely feedstocks and where will they be grown; does ethanol represent the best fuel for the future U.S. transportation sys - tem, or are other energy sources, including other bio-based fuels, potentially more sustainable; can policy inconsistencies at both federal and state levels be resolved to support sustainability objectives; how can changes in land use be included as a cost of production; and what are the long term consequences for scarce water resources, ecosystems services, and local communities? 

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 EXPANDING BIOFUEL PRODUCTION AND THE TRANSITION TO ADVANCED BIOFUELS CONTEXT The U.S. biofuel industry has grown dramatically in recent years, with pro - duction expanding from 1.6 billion gallons in 2000 to 9 billion gallons in 2008. 1 This dramatic increase can be attributed to the rise in production of corn-based ethanol and associated, smaller quantities of soy-based biodiesel. The number of refineries has also increased—from 54 in 2,000 to 170 in January 2009. 2 The worldwide economic recession and lower prices for petroleum have slowed the expansion of the industry, but because of strong state and federal mandates, production is expected to grow until production capacity reaches the federally mandated 36 billion gallons of biofuel in 2022.3 While energy prices, energy security, and climate change are front and center in the national media, these issues are often framed to the exclusion of the broader issue of sustainability—ensuring that the production and use of biofuels do not compromise the needs of future generations by recognizing the need to protect life-support systems, promote economic growth, and improve societal welfare. Thus, it is important to understand the effects of biofuel production and use on water quality and quantity, soils, wildlife habitat and biodiversity, greenhouse gas emissions, air quality, public health, and the economic viability of rural communities.4 Although corn-based ethanol is likely to continue to be a major contributor to U.S. biofuel supply in the near term, it is important to plan for the transition to advanced biofuels, such as agricultural resides (e.g., corn stover), perennial grasses and woody biomass, which are now almost universally viewed as prefer- able from a sustainability perspective. Decisions have been made at various levels of government to promote biofuels as a potential means of reducing greenhouse gases and enhancing economic development and energy security without a clear understanding of the economic, environmental, and social impacts of biofuel production and use. While a number of studies have examined some of the environmental im- pacts associated with the expansion of biofuel production and use, most of these have focused at a national level. For example, the National Academies published a report assessing the water implications of biofuels5 and the World Resources Institute has also published a series of reports on the subject. 6 However, many 1 See http://www.ethanolrfa.org/industry/statistics/#A (accessed July 2, 2009). 2 See http://www.ethanolrfa.org/industry/statistics/#EIO (accessed July 2, 2009). 3 U.S. Energy Independence and Security Act of 2007 (EISA). 4 Energy security, while part of the EISA mandate, does not traditionally fall within the scope of sustainability analyses and thus was not part of workshop discussions. 5 Water Implications of Biofuels Production in the United States. NRC 2009, http://www.nap.edu/ catalog.php?record_id=039. 6 Plants at the Pump: Reiewing Biofuels’ Impacts and Policy Recommendations. World Resources Institute, July 2008; Biofuels and the Time Value of Carbon: Recommendations for GHG Accounting Protocol. World Resources Institute, March 2009.

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3 INTRODUCTION AND OVERVIEW of the environmental effects of corn-based biofuels as well as next generation biofuels are uniquely local or regional—including potential changes in water availability or soil fertility. And many of the economic and social effects are also most pronounced at a local level. In an effort to better understand these impacts, the steering committee de - cided to narrow the workshop scope and focus on three states in the Upper Mid - west—Iowa, Minnesota, and Wisconsin. This region is undergoing an economic transition from a historical farming and manufacturing economy. Biofuels tech - nology development and increased production have been touted as central to a stronger regional economy. The three states have supported aggressive policies to promote the development of the industry, focused on both the supply side as well as the demand side. In addition, each of these states has strong research universi - ties and a number of academic researchers focused both on the technology aspects of biofuels and on the economic, environmental, and social impacts. Iowa, Minnesota, and Wisconsin have seen substantial increases in corn production since 2000, with total acreage expanding from 23,000 planted acres in 2000 to 26,650 in 2007, and then declining slightly in 2008.7 Each state also has a large number of ethanol refineries—39 in Iowa, 17 in Minnesota, and 9 in Wisconsin. These plants account for 35 percent of the total U.S. nameplate capacity.8 These states are also likely to be an important source of biomass feed - stocks for next-generation biofuels. Data from the National Renewable Energy Laboratory suggest that approximately 75,000 tons of biomass resources could be available annually from these three states—almost one-quarter of total U.S. biomass resources.9 The workshop was designed to draw on the expertise of researchers and policy makers in the three-state region to better understand these local impacts and the challenges faced by state policy makers, while at the same time recogniz - ing the need to also consider the broader national and global impacts, including impacts on world food supplies. ORGANIzATION OF THE REPORT This report is limited in scope to the presentations, workshop discussions, and background documents produced in preparation for the workshop. Chapter 2 discusses the principal policy drivers behind the expansion of biofuel production and use. Chapter 3 focuses on the results of a recent National Academies report 7 NationalCorn Growers Association. See ncga.com/corn-production (accessed July 6, 2009). 8 Seeneo.neb.go (accessed July 6, 2009). Name plate capacity is the maximum output of a plant based on conditions designated by the manufacturer. Actual production is likely to be less than this amount. 9A. Milbrandt. A Geographic Perspectie on the Current Biomass Resource Aailability in the United States. NREL/TP 560-39181. December 2005. Available at http://www.nrel.go/docs/fy06osti/ 398.pdf.

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 EXPANDING BIOFUEL PRODUCTION AND THE TRANSITION TO ADVANCED BIOFUELS on the status of alternative liquid transportation fuel technologies as well as other efforts to develop alternative transportation fuels. Chapter 4 describes some of the environmental, economic, and social impacts associated with current- and next generation biofuels. Chapter 5 provides a perspective on issues to be addressed as part of the transition to advanced biofuels, including federal policy, research needs, and tools and indicators needed by decision makers to assess the conse - quences and tradeoffs of expanding production and use. The report appendixes include the workshop agenda, brief biographies of workshop speakers, a selected bibliography of reports and papers addressing issues of biofuels and sustainability, a background paper describing the biofuels policies in the three Upper Midwest states, and a paper on tools and indicators used to assess various aspects of biofuel production and use. The appendixes also include examples of ongoing federal research programs and projects related to sustainability and biofuels.