# Presentation: 423146

## The Role of Agriculture in Our Energy Future

***The Role of Agriculture in Our Energy Future***

**Presentation by**
**Roger Johnson**
**Agriculture Commissioner**
**Renewable Fuels Action Summit**
**Bismarck, ND – June 12, 2006**

## North Dakota has enormous potential to produce and consume energy from renewable resources.  

- North Dakota has enormous potential to produce and consume energy from renewable resources.

## Why biofuels?

- Abundance of raw products –
- Soybeans- 2nd largest cash crop in North Dakota – 4+ million acres to be planted this year
- Corn -  1.6 million acres to be planted
- Canola – 830,000 acres to be planted
- Ethanol and biodiesel production result in high nutrient by-products that can be fed to our cattle
- Environmentally friendly
- Relieves pressure and burden on “finite” energy resources
- Will help keep energy costs in check

## Our neighbors are producing more ethanol...

| State | Capacity
(mmgy) | Expansion (mmgy) | Construction
(mmgy) | Total Capacity (mmgy) |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Iowa | 1134 | 95 | 470 | 1699 |
| Nebraska | 543 | 14 | 491 | 1048 |
| South Dakota | 475 | 18 | 110 | 603 |
| Minnesota | 495 | 8 | 90 | 593 |
| North Dakota | 33 | 0 | 100 | 133 |
|  |  |  |  |  |

**Our neighbors are producing more ethanol...**

- Source:  Renewable Fuels Association –updated 6-06.

## Ethanol Development in North Dakota

- Ethanol Development in North Dakota

## Our neighbors are turning more of their corn crop into ethanol...

**Our neighbors are turning more of their corn crop into ethanol...**

- Sources:  Renewable Fuels Association, National Agricultural Statistics Service

**(% of 2004 Corn Production)**

## Our neighbors are using more ethanol in their gasoline...

**Our neighbors are using more ethanol in their gasoline...**

- Source:  Renewable Fuels Association

## We are making strides with biodiesel...

**We are making strides with biodiesel...**

- Source:  BBI International

## Biodiesel Development in North Dakota

- Biodiesel Development in North Dakota

## Why energy crops?

- More than 3 million acres of land in ND currently enrolled in CRP
- Energy crops have great potential for future biofuel production
- Cellulosic ethanol net energy value 3x greater than corn ethanol
- Greater emphasis on conservation/energy crops in upcoming farm bill

## Other states are making significant investments in renewable energy...

- New York
- $20 million state investment in cellulosic ethanol pilot facility
- tax credit for home heating oil blended with biodiesel
- Iowa
- Established tax credits for E-85 and B-2.
- Appropriated $13 million for biofuels conversion
- Establishes dealer goal of 25% of sales are biofuels by 2021
- Washington
- Established standards for biofuel use in the state
- Created “Energy Freedom Program”

## What are realistic goals for the future development of Renewable Energy in North Dakota?

**What are realistic goals for the future development of Renewable Energy in North Dakota?**

## Goals for the future

**Goals for the future**

- Increase state funding for renewable energy development and promotion from  $4.5 million for the current biennium to $20 million for next  biennium.

- Foster public-private partnerships to examine and identify the best means for North Dakota to exploit emerging energy technologies, such as cellulosic ethanol, bio-oils and manufacture of bio-products.

## Goals for the future

**Goals for the future**

- Turn 75 percent of the state’s corn production into ethanol by 2010 and begin to establish a cellulosic ethanol production industry. Cellulosic ethanol, as pioneered by the Canadian company Iogen, is produced from straw and other plant waste, certainly an abundant resource in North Dakota.

- Make ethanol 10 percent of every gallon of gasoline sold in North Dakota by 2008 and increase that to 20 percent by 2013, following Minnesota’s example.

## Goals for the future

**Goals for the future**

- Convert 50 percent of our soybean production into biodiesel by 2010 and all of our current canola production into biodiesel by 2007.
- Make biodiesel 5 percent of every gallon of diesel fuel sold in North Dakota by 2008 and 10 percent by 2012.

## Goals for the future

**Goals for the future**

- Add 100 MW of community-based, locally-owned wind generation by 2010.

-  Provide 10% of electrical power in state-owned and used facilities from renewable energy sources by 2007 and 20% by 2012.

## Goals for the future

**Goals for the future**

- Dedicate 2 million acres to the production of perennial energy crops by 2010. This would utilize 60 percent of land currently idled in the Conservation Reserve Program.

## State Incentives Should Focus on Producer-Owned Projects...

- Producers own...
- Nationally: 39% of ethanol production capacity
- Minnesota: 66% of ethanol production capacity
- South Dakota: 52% of ethanol production capacity
- North Dakota: 0%

- Source: Renewable Fuels Association via ND Corn Growers Association, 6-06.

**Notes:**
Red Trail is not considered farmer owned by RFA because it does not meet the criteria of 51% owned by farmers.  

## Our challenge is to plan for the future...to develop and implement bold ideas and create new opportunities for renewable energy right here in North Dakota.

- Our challenge is to plan for the future...to develop and implement bold ideas and create new opportunities for renewable energy right here in North Dakota.

## Thank You!

- Roger Johnson
- Agriculture Commissioner
- 600 E Blvd Ave
- Dept 602
-  Bismarck, 58505
- (701) 328-2231
- 1-800-242-7535
- _[ndda@nd.gov](mailto:ndda@nd.gov)_
- _[www.agdepartment.com](http://www.agdepartment.com/)_

## North Dakota is an energy state...

*North Dakota is an energy state...*

## North Dakota is an energy state...

- Rank 6th in the nation in energy production per capita
- Rank 11th in the production of coal
- Rank 9th in the production of petroleum

- Source:  Energy Information Administration

## Demand in ALL primary energy sectors is projected to grow...

## US petroleum consumption and imports will continue to rise...

- Source:  Energy Information Administration

- Projections show we will be importing nearly 70% of our oil in 2025
- US Crude Oil Imports, YTD 2005

| 
Country | Thousand Barrels/Day |
| --- | --- |
| Canada | 1,616 |
| Mexico | 1,530 |
| Saudi Arabia | 1,485 |
| Venezuela | 1,297 |
| Nigeria | 1,032 |
| Iraq | 524 |

## U.S Utilization of Natural Gas and imports will also continue to rise...

- Source:  Energy Information Administration

- Technological advances in the production and transportation of Liquified Natural Gas (LNG) are anticipated

## Ethanol (with corn as a primary feedstock) is projected to increase to 4,544 mmgy by 2025 
26% of increase consists of ethanol distilled from cellulose
E-85 demand is projected to increase from 11 mmgy to 47 mmgy in 2025

- US Ethanol demand will slowly increase...

- Source:  Energy Information Administration

- Ethanol (with corn as a primary feedstock) is projected to increase to 4,544 mmgy by 2025
- 26% of increase consists of ethanol distilled from cellulose
- E-85 demand is projected to increase from 11 mmgy to 47 mmgy in 2025

- ?

- EIA projections were released before passage of federal energy bill

## Wind-powered generating capacity is projected to increase to from 6.6 GW in 2003 to 11.3 GW in 2025
Electrical generation from municipal solid waste and landfill gas will grow from 7 billion kwh in 2003 to 29 billion kwh in 2025

- US Renewable Electricity Generation will grow...

- Source:  Energy Information Administration

- Wind-powered generating capacity is projected to increase to from 6.6 GW in 2003 to 11.3 GW in 2025
- Electrical generation from municipal solid waste and landfill gas will grow from 7 billion kwh in 2003 to 29 billion kwh in 2025

## Why Wind?  North Dakota Ranks 1st in Wind Energy Potential

**Source:  Wind Energy Potential - *****An Assessment of the Available Windy Land Area and Wind Energy Potential in the Contiguous United States*****, Pacific Northwest Laboratory, 1991.  (**"Potential" is stated in terms of average Megawatts of Capacity (MWa), or megawatts of capacity at 100% capacity factor. 1 MWa is roughly equal to about 3 MW of nameplate wind turbine capacity.)

**Why Wind?  North Dakota Ranks 1****st**** in Wind Energy Potential**

**(MW)**

## 15 other states have more wind generation than North Dakota...

**MW**

- U.S. Installed Wind Energy Capacity by Selected States

- Source: American Wind Energy Association, January 2006.

## Even with wind projects on the drawing board, North Dakota lags behind...

- (MW)

**US Wind Capacity by State**

- Source:  American Wind Energy Association, 2006.

## Wind Energy Development in North Dakota

- Wind Energy Development in North Dakota