**INTRODUCTION: MR. TOLMAN**

In 1837 John Deere founded a company that would come to bear his name.
Incorporated as Deere & Company in 1868, it has grown from a one man
blacksmith shop into a corporation that today does business around the
world.

Chairman and Chief Executive Officer of Deere & Company is Mr. Robert
Lane. Mr. Lane has been Chairman and CEO of Deere & Company since the
year 2000. He joined Deere in 1982 and has held key management positions
domestically and internationally, prior to being named CEO.

This past year the company entered into the renewable energy business
with its John Deere Wind Energy Group, a unit of John Deere Credit. It
provides project development, debt financing and other services to help
farmers harvest the wind. Please welcome Mr. Robert Lane.

**[GROWING SUSTAINABLE BUSINESSES]{.underline}**

**ROBERT LANE**

Good Morning. First, thank you Secretary Bodman and Secretary Johanns,
for inviting John Deere to participate in this important and timely
Renewable Energy Conference. In addition, it is a great privilege to
follow the thought-provoking comments of Patricia Woertz, and to
acknowledge all the distinguished speakers and panelists with whom I am
sharing this podium. I certainly want to acknowledge all of you who have
come here at this very important time to address the advancement of
renewable energy. As growers, manufactures, distributors, investors,
policy-makers and community leaders, we all have important work to do.

It is an honor for me to represent a company whose core values, quality,
innovation, integrity and commitment, were first instilled in the
business by our founder and extend to everything we do. In today's
environment, perhaps these values are more relevant than at any time in
our history as a company. Our meeting here in St. Louis this morning in
the shadow of the great Gateway Arch, brings to mind an interesting
connection between this city and John Deere. As you may know, this
Gateway Arch was designed by the great 20th Century Architect, Eero
Saarinen. You may not know that another of his great projects is just up
the Mississippi River here at the worldwide headquarters building of
John Deere in Moline, Illinois. Those of us who work in that building
have the privilege of being inspired by Saarinen's creative genius
everyday. But Saarinen's archway here in St. Louis, stands as a dramatic
symbol of the westward expansion of the United States in the 19th
Century, the opening of a vast new frontier with enormous potential.
John Deere also played an integral part in the development of that vast
frontier through its innovative product offerings and the work of
generations of John Deere employees. I think we would all agree that
renewable energy is another promising new frontier with significant
potential for the United States and the world.

At John Deere we are focused on enabling our customers and their
communities, to participate in renewable energy development. Our goal is
to foster competitive, profitable and sustainable renewable energy
businesses. My message to you this morning, is that laying the
groundwork for growing sustainable businesses is critical to the long
term future of renewable energy in the United States and indeed, the
entire world. It would indeed be a shame if the promise of renewable
energy were not met, because our early successes could not be sustained
over time for a lack of sound business underpinnings. First, I should
perhaps address what I mean by sustainable businesses and why this is so
important to the development of renewable energy.

John Deere is in its 169th ninth year of operation. I hope you would
agree that that gives us some credibility on this subject. But Deere is
in second place among companies on this program this morning. I must
also recognize that DuPont, represented by my colleague, Chad Holliday,
has operated for more than 200 years. And ADM is now well past the 100
year mark. Businesses like ours simply do not operate that long without
attending to three critically important constituencies, their customers,
their employees and their shareholders.

The attention to customers requires a particular focus. It often means
anticipating market and technological advances, recognizing the specific
needs of markets and customers sometimes before the customer does, and
offering innovative solutions that he or she may not even be aware of.
Sustainability in this context then, requires that the business provide
a high quality product or service that fully meets the customer's needs;
a workplace environment that attracts the best and the brightest
employees and enables them to realize their potential. And succeeding
with customers, employees, in this way, is a necessary condition for
ensuring that shareholders receive an attractive return on their
investment. In short, sustainability requires laying the building blocks
in the beginning that will serve these vital constituencies well.

I raise this question because of the nagging question that continues to
surround renewable energy. And that is whether the surging interest in
renewable energy development is merely another short term bubble in our
economy; as we have seen so often before, or whether it is in the
initial stages of a thriving industry that will contribute both economic
and societal benefits, not only today, but for generations to come? Let
me be direct to you. Most of us know that there are some serious
reservations being raised today. Some suggest there is little beyond a
speculative drive; that it is built upon currently volatile world energy
markets and the Midwest's outsized political clout, and that it is
simply not sustainable. Upon careful examination, a solid case can be
made that these concerns are unfounded. So let's examine how
sustainability can be achieved.

We are already beginning to glimpse some of the potentially enormous
benefits of long term investment in renewable energy. We're seeing
customer demand for quality products and services. We see considerable
capital flowing from serious long term investors to commercial ethanol
and biodiesel production and some capital beginning to move to wind
energy, cellulosic conversion and bio-refinery development. And we are
fast recognizing that growing public goods shared across a society, can
come from this investment; environmental benefits, enhanced national
security and renewed rural development.

History is replete with illustrations of where sound public policies
have proven essential to the emergence of economic, political and social
environments that enable good businesses to evolve and become
sustainable. Renewable energy with all of its benefits should be no
exception. Let me be clear on this point. There can be a highly useful
partnership between government and the private sector. There need not be
an inherent contradiction between government and business nor a
perpetual dependence. Public policies can provide useful pump priming
for new evolving industries, creating the infrastructure needed for
markets to develop and businesses to grow. Tax and regulatory incentives
can provide needed planning stability, while business conditions evolve,
facilitating the growth of new business ventures. Over time, as markets
and businesses mature, the need for these incentives will recede and a
transition away from these policies is appropriate.

Now, I know there are detractors who will say, this is perhaps all true,
but a subsidy once started, is a subsidy that never ends. This is a
risk, of course, but one that can be anticipated and mitigated. They
might well cite the currently much discussed farm subsidies of the
developed countries. Let me be forthright in addressing this. The United
States Government has long provided public support for the farm sector,
but now, along with others, is aggressively looking for ways to affect
an intelligent transition; to have an orderly phasing-out of trade
distorting subsidies in a way that enables all producers to fairly
compete for the fast growing world markets.

Our government now has on the table in the DOHA negotiations, a proposal
for phasing down and eliminating trade distorting subsidies, in exchange
for expanded access to markets. In fact, President Bush has twice called
upon other developed country leaders to accept this challenge. And while
the trade talks are suspended for the moment, we at Deere, along with
others in the business community, are fully supportive of their quick
revival and the conclusions of an ambitious, robust DOHA Agreement. The
potential benefits to agriculture worldwide, are enormous. And we would
like to see renewable fuels assume an important role in the
international marketplace with fully defined standards and trading rules
as well. Secretary Johanns, I want you to know that we are most
appreciative of your personal leadership and steadfast participation in
these important talks.

If you will then accept these arguments about developing a sustainable
renewable energy sector, then we should turn our attention and public
discussion on how to best invest public resources to achieve the promise
of renewable energy. Clearly, we at John Deere believe that the public
or societal benefits to be derived from a thriving sustainable renewable
energy industry; cleaner air, reduced dependence on foreign oil, greater
energy diversification and rigorous rural development, justify this
investment.

Patricia Woertz earlier provided us with a great review and outlook for
the biofuel sector. I would like to spend a few minutes on another
example of renewable development, by heightening John Deere's
experiences in growing a sustainable wind energy business.

John Deere has looked carefully at how to help our customers unlock the
potential of wind energy in North America. We have formed a new business
unit to provide project development, debt and equity financing, and
other services to those seeking to harvest wind power. The potential for
wind power is enormous. The United States can become a global leader in
wind energy. The U.S. has all of the required elements, reliable wind
sources in acceptable locations, cutting-edge technology, capital, the
entrepreneurial spirit to develop projects that provide economic
products to customers and benefits to the country. Moreover, rural
interests are uniquely positioned to benefit enormously from this
opportunity.

John Deere's wind energy business has successfully partnered with
farmers and developers, to bring on-line almost 60 megawatts of wind
generated power. In addition, our business today, has projects under
construction or approved, that will generate another 434 megawatts. By
the end of next year, John Deere expects to become one of the leading
owners/operators of wind energy projects in the United States. We call
our model, *\"The Community Wind Business Model\"*. It allows us to
partner with farmers, land owners, communities and developers, to
identify and evaluate potential projects and to provide capital and
business know-how to bring viable projects on-line. Our model delivers
economic prosperity to farmers and to the broader rural community.

Our financial strength also enables us to secure a stable supply of wind
turbines. Over time our partners, often our former customers, typically
gain an ownership interest in the projects, assets and share the
economic benefits they generate. In fact, we have found that such
partnerships and community engagement greatly facilitate developing
these projects into sustainable businesses.

One good example is right here in Missouri, where John Deere has
successfully partnered with the Wind Capital Group of St. Louis, an
associated electric cooperative of Springfield, to develop the Bluegrass
Ridge Project. The project will begin electricity production later this
year. And when fully operational Bluegrass Ridge will generate almost 57
megawatts of electricity per year, enough to power as many as 34,000
homes. This project exemplifies the broader win-win possibilities for
wind energy through a land lease program that provides a steady stream
to farmers, who site the turbines on their land. And for the community,
it adds to the local tax base and generates significant new revenues to
improve schools and other local services. It will generate clean
electric power to help the County and the State to meet their renewable
energy targets, which rise to 15 percent by 2023. So, it furthers
specific energy, environmental and security objectives, as well. That's
a win-win, wind paradigm. And as I discussed at the outset, public
policy has an important role to play in wind energy development, from
the renewable energy standards now enacted in twenty-two states, to the
Federal Production Tax Credit, to the USDA Farm Bill Grants. These are
specific examples of how public policies can facilitate project planning
and investment. They allow project economics to develop, so that the
businesses become sustainable over the long run. They work best when
they are predicable for a number of years and thus, facilitate
reasonable returns, when the projects are well conceived and well
managed. For these reasons the Federal Production Tax Credit typically
limited two years duration, should be extended for longer periods. Now,
let me briefly address renewable fuels. During the course of this
conference you will be hearing from some of the best experts available
on the subject. The point I wish to stress, is that sound business
principles must also be the basis for growing a sustainable biofuel
sector, just as they must be in wind energy. There are many technologies
now under development and in the field to convert biomass into various
bioproducts and biofuels. We are seeing some products and technologies
advanced to commercialization and market acceptance sooner than others.
In the end, technologies and products that provide the most sustainable
business proposition, value to the customer and return to the
shareholders, are the ones that will emerge as market leaders. In fact,
likely future genetic advances will greatly enhance the welfare of human
kind. Thus, there is an opportunity to accelerate the development of
cellulosic biomass as a future sustainable source of renewable liquid
fuels, while still meeting food, feed and export demands. To have a
sustainable sector that achieves all the promise of an improved
environment, greater national security, thriving rural areas and
generally improving the quality of life for many, we ought to make
greater technological advances faster. And I would be remiss if I did
not also express appreciation to Secretaries Johanns and Bodman for
their research funding already allocated to making this come true.

In 2005 a USDA Department of Energy Study clearly outlined the extent of
the opportunity to expand biofuels production through the use of
cellulosic biomass. That report concluded that by 2030, more than 800
million tons per year of cellulosic biomass could be produced from crop
residue and perennial crops in the United States. And another 120
million tons actually could be derived from forest residues. For
reference, this biomass would be more than the total grain, oil, seed,
sugar and hay crops, now harvested in the United States last year. This
clearly points to a tremendous opportunity. But it also presents a
significant challenge; how to produce, collect, transport and process,
such a volume of valuable energy feed stock.

To meet this challenge, all of us, government, academia and the private
sector, ought to pick up the pace across the system in commercial scale
research and development, in harvesting technologies, materials
transportation, conversion and fuels distribution. The one common
denominator among renewable liquid fuel technologies is biomass. It is
the essential ingredient, regardless of the product or the conversion
technology. This fact reinforces the tremendous opportunity for
agriculture and for forestry, and indeed, for rural communities, to
participate directly in and derive real value from the creation of great
renewable energy businesses. In so doing, this will build a viable
renewable energy sector from the ground up.

Deere's role as a provider of biomass harvesting and collections
systems, are agriculture and forestry equipment technologies, defines
but one aspect of our interest of renewable fuels. In addition, as you
may know, John Deere manufacturers technologically advanced diesel
engines on four continents of the world. Deere is a leader in providing
environmentally friendly fuel efficient engines. Hence, we also have
great interest in fuel quality and consistency, which is lacking in some
areas. The renewable fuel sector must be built on consistent performance
standards and certification regimes that ensure the availability of high
quality fuel products.

At the outset of my remarks I mentioned the promise symbolized by the
Gateway Arch. This Arch is of course, a monument to Jefferson and the
Westward Expansion, but it also exemplifies the vision of its architect.
The biographer of Eero Saarinen describes him as one who, quote,
*"Refused to be constrained by any preconceived ideas,"* end quote. When
he was asked to design this monument to the opening to the great
frontier, Saarinen said that neither an obelisk nor a rectangular box
would do for this purpose. But in his words, *\"A great arch did seem
right\"*. Saarinen's intent to create a monument to those boldly moving
toward the future, are to serve as an inspiration to all of us as
partners to explore and develop this new frontier of renewable energy.
If we can grow great businesses, businesses that deliver long term
sustained performance, businesses that endure, I am confident we can
meet the promise of renewable energy for our children and their
children.

Indeed, businesses that endure over the long run will also contribute to
human flourishing through the societal benefits provided to future
generations, from expanding agricultural markets and rural development;
to enhancing energy security and environmental improvement. This is our
opportunity, this is our challenge. Thank you for listening.

**CONCLUSION: MR. TOLMAN**

Thank you Mr. Lane, for that vision, that perspective, and for all that
you and John Deere do for advancing renewable energy. I particularly
like the win-win wind paradigm, that's catchy.