The ground truth for biomass development is with the feedstock. Many biomass projects are based on crop residues and waste streams – be they municipal waste or crop residues. Developing cost effective conversion technologies go hand in hand with figuring out feedstock logistics. Dedicated bioenergy crops add another layer to the development challenge – finding and working with the farmers who will grow those energy crops.

A number of people are struggling with just how to do that. I wrote an article in Ethanol Producer Magazine this fall ("Making the Switch" http://ethanolproducer.com/article.jsp?article_id=4868 ) describing three programs aiming to help farmers make a switch to growing bioenergy crops.

The Biomass Crop Assistance Program in the new Farm Bill is one program that's being written now. As a brand new, working lands program, there's a lot of details to work out, but it could be a key program to helping jumpstart biomass crops. BCAP includes farmer payments for establishment costs as well as annual incentive payments. A BCAP project will be centered around a conversion facility which is rather broadly defined. It could be one of the cellulosic ethanol projects being developed, a pelleting plant or a biomass power plant, among others. The biomass facility, or even a group of farmers, apply for the BCAP funding. The farmer payments are likely to be handled through the local county Farm Service Agency, just like other USDA program payments are handled. It has great potential, but as always, how successful it will be will depend on the details of the rules now being written.

Minnesota has passed a state-level program which they hope to piggyback onto BCAP. The Reinvest in Minnesota-Clean Energy program will purchase long-term easements from farmers, giving a lump sum, up front payment to farmers for multi-species perennial bioenergy crops. They've got some experience using a predecessor program purchasing easements for wetland restoration and other conservation goals. The program director told me that from experience, they know the payment for the 20 year easement has to be a real incentive – the RIM Clean Energy payments will start at 80 percent of the estimated market value of the land as shown on the land tax statement. Since that will amount to thousands of dollars, this won't involve a huge number of acres, but the hope is that a few select projects will take some of the risk out of demonstrating these new ideas.

The third program I talked about in that article is in Iowa, where the Natural Resource Conservation Service is offering Environmental Quality Improvement Program contracts in several southern Iowa counties for switchgrass. The Iowa switchgrass project led by the Chariton Valley RC&D was one of the first to systematically research and develop switchgrass for bioenergy. They successfully demonstrated switchgrass could be cofired with coal. The power plant is ready to go, but doesn't want to own the feedstock procurement system. The last time I talked with the organizers, they were struggling to hang on to switchgrass acres while they got a business plan together and raised money to build the handling facilities. The EQIP program was designed to help them along by getting a few more acres into switchgrass.

Since that story was written, I've learned of another another project underway in Minnesota organized by the Three Rivers RC&D. http://www.threeriversrcd.org/pcwl%20pages/pcwl_home.htm They're signing up 1,000 acres this year in a demonstration program to provide incentives to farmers to grow new alternative conservation crops for energy and emerging industry.

These programs are addressing the chicken-and-egg problem. Farmers can't invest in a new crop when there's no sure market. New bioenergy projects, many of which are fabulously expensive to build, need a ready supply of feedstock. The logistics of handling that feedstock will require investments too. Biomass projects are going to prosper or fail based on their ability to match up the two sides of the equation.

When the corn ethanol industry was beginning to build out a decade ago, the developers were tapping into a huge surplus of corn. Building out a biomass industry requiring new dedicated bioenergy crops is going to be a far different proposition. The Minnesota and Iowa programs, BCAP and other initiatives in other states will be watched closely to see which work best.