1

Strategic Assessment of Bioenergy 

Development in the West 

Analyses of Deployment Scenarios and 

Policy Interactions 

FINAL REPORT

Western Governors’ Association and Antares Group Inc.  

September 1, 2008 
i

Strategic Assessment of Bioenergy Development in the West 

In February 2008, the Western Governors’ Association adopted a policy reaffirming the 

governors’ strong commitment to enhance and diversify the region's transportation fuels 

portfolio. The Strategic Assessment of Bioenergy Development in the West represents a 

major step in fulfilling that commitment and expands upon earlier work through WGA's 

Clean and Diversified Energy Initiative and the Transportation Fuels Initiative. The 

Bioenergy Assessment Team was formed to examine the potential for future development 

and to create a comprehensive framework to assess environmental, technical and 

socioeconomic impacts associated with national, state and regional bioenergy and biomass 

management policies. This assessment will assist the governors individually and collectively 

as they develop bioenergy policies. The extensive evaluations conducted by the Assessment 

Team are contained in the following areas: 

• Biomass Resources in the Western States 

• Biofuel Conversion Technologies 

• Spatial Analysis and Supply Curve Development 

• Analyses of Deployment Scenarios and Policy Interactions 

While the assessment represents the consensus view of its authors, it is not adopted policy 

and does not represent the views of WGA or any individual Western Governor. Support for 

this work was provided by the U.S. Department of Agriculture. 

Members of the Western Bioenergy Assessment Team 

Western Governors’ Association: Gayle Gordon 

University of California, Davis: Nathan Parker, Peter Tittmann, Quinn Hart, Mui Lay, 

Joshua Cunningham and Bryan Jenkins 

Kansas State University: Richard Nelson 

U.S. Forest Service: Ken Skog, Marcia Patton Mallory, Robert Rummer and R. James 

Barbour 

U.S. Department of the Interior: John Stewart 

Antares Group, Inc.: Edward Gray, Anneliese Schmidt and Chris Lindsey 

Future Resources Association: Gregg Morris 

National Renewable Energy Laboratory: Anelia Milbrandt 

 

Consultants: Jim Kerstetter and Ralph Overend 
ii

TABLE OF CONTENTS 

1 INTRODUCTION ................................................................................................................................................. 1

2 PRODUCTION SCENARIO DEVELOPMENT ............................................................................................... 3

2.1 SCENARIO 1: FORECAST FOR BIOFUELS DEVELOPMENT WITHOUT COMPETITION FROM BIOPOWER ......... 3

2.2 COMPARING POTENTIAL GROWTH AND MODERATE GROWTH ..................................................................... 6

2.3 VARIATIONS ON THE BASELINE RESOURCE PROJECTIONS .......................................................................... 8

2.3.1 Increased Forest and Herbaceous Energy Crop Yields ................................................................ 8

2.3.2 Corn Commodity Price Variations .................................................................................................... 9

2.3.3 Limitations to Crop Production for Biofuels ..................................................................................... 9

2.3.4 Slower Technology Development ..................................................................................................... 9

2.3.5 Scaling Up Biorefinery Production Plants ........................................................................................ 9

2.4 FACILITY DESIGN AND SITING TRENDS ......................................................................................................... 9

2.5 MULTIPLE BIOENERGY PRODUCTS: BIOFUELS, POWER AND CHP ............................................................ 10

3 POLICY RECOMMENDATIONS SUPPORTING THE DEPLOYMENT SCENARIOS .......................... 13

3.1 BARRIERS AND CHALLENGES TO BIOFUELS DEVELOPMENT IN THE WEST ................................................ 13

3.2 POLICY RECOMMENDATIONS ...................................................................................................................... 15

3.2.1 Research, Demonstration and Technology Transfer ................................................................... 16

3.2.2 Cellulosic and Other Biofuels Feedstock Supply .......................................................................... 16

3.2.3 Increasing the Demand for Biofuels ............................................................................................... 17

3.2.4 Production and Infrastructure .......................................................................................................... 17

4 EVALUATING THE BENEFITS OF BIOENERGY DEVELOPMENT IN THE WESTERN STATES ... 19

4.1 CONVERTING BIOMASS RESIDUES AND WASTES TO ENERGY ................................................................... 19

4.2 LAND CONVERSION IMPACTS OF BIOENERGY DEVELOPMENT ON BIOGENIC CARBON NEUTRALITY AND 

FOOD PRODUCTION ................................................................................................................................................. 21

4.3 WGA STRATEGIC ASSESSMENT APPROACH .............................................................................................. 22

REFERENCES .......................................................................................................................................................... 25
iii

List of Figures 

FIGURE 1 - FORECAST GROWTH IN BIOFUELS CAPACITY ............................................................................................ 4

FIGURE 2 - HEC LAND DEVELOPMENT FORECAST ...................................................................................................... 7

FIGURE 3 - COMPARISON OF POWER AND FUELS FEEDSTOCK SOURCES ................................................................ 11

List of Tables 

TABLE 1- WGA FORECAST FOR BIOFUELS PRODUCTION POTENTIAL BY 2015 .......................................................... 4

TABLE 2 - KEY DEPLOYMENT METRICS FOR THE BIOFUELS – POTENTIAL GROWTH SCENARIO ................................ 6

TABLE 3 - ESTIMATED FEEDSTOCK AFFORDABILITY BY TECHNOLOGY ...................................................................... 12
1

1 Introduction 

The analysis team has employed all of the expertise of the Strategic Assessment Team and 

the Transportation Fuels for the Future1

 Advisory Committee and technical teams to lay out 

resource and technology development scenarios and the market and policy conditions that 

could support those scenarios. The date chosen for projecting potential production 

capability was 2015 so that results would be directly comparable to the Clean and 

Diversified Energy Initiative (CDEI) analysis for biomass power development in the West. 

Technology and resources will continue to be developed beyond this near term horizon so 

that this forecast production capability is not the endpoint but an intermediate point at 

which Biofuels production could become a significant supply and results can be measured. 

The scenarios identify what resources, technologies and strategic locations could be 

developed and the pace at which they might be introduced to achieve the potential for 

Biofuels production set forth in the accompanying report. The expected technology 

progression and transition from today’s technology and processes to tomorrow’s 

vision is provided. The critical transition forecast for this time period is the switch 

from starch to cellulose resources grown on lands or recovered from waste 

streams that minimize the impact on standing carbon reserves and food 

production. That is, sustainability is an important criterion throughout our work. In this 

report we use the term Lignocellulosic Biofuels (LCB) to represent the class of feedstocks 

and technologies that will enable this transition. In addition to a baseline projection for 

Biofuels production in 2015, six key sensitivity cases were considered. These variations on 

the baseline scenario are all valid projections for Bioenergy development and help policy 

decision makers understand some of the important factors that could increase or reduce 

Biofuels production capability in the West by 2015. 

Scenarios also suggest how the technology transition is likely to proceed while taking 

advantage of synergies available only in Bioenergy facilities. Meeting the challenge for 

deploying Biofuels technology at the rates forecast in this strategic assessment will require a 

private and public partnership of a scope not heretofore applied to Bioenergy development. 

To better understand what policies would be most effective and efficient to encourage 

realization of the Bioenergy potential in the West, WGA relied on the expertise of its 

Advisory Committee on Transportation Fuels for the Future. Under the leadership of the 

Committee, expert teams on gasoline substitute Biofuels and Biodiesel/Renewable Diesel 

technologies were formed to advise on the prospects and policy framework that would be 

required to develop Bioenergy resources for transportation fully. These teams included fuels 

experts representing stakeholders from industry, government, the environmental 

community and academia. Their reports received public review and are posted on the WGA 

website. This work was analogous to the CDEAC Biomass Task force which focused on the 

use of Bioenergy for Power production. 

Using the Governors’ goals to frame the policy design, the Advisory Committee reviewed 

each team’s report and produced an overarching policy roadmap, the Transportation Fuels 

 

1

 In 2006, the Western Governors passed the Transportation Fuels for the Future Policy Resolution 

(http://www.westgov.org/wga/policy/06/futurefuels.pdf) based on their belief that few issues facing the nation are 

more serious than our reliance on imported oil, the ramifications of global competition for this resource, and the 

associated risks to our energy, economic, and environmental security. The Governors’ launched an initiative to 

develop a policy roadmap to integrate alternative fuels into a transportation fuels portfolio, taking into account the 

specific resource attributes of the West. The WGA formed an Advisory Committee comprised of Governors’ 

representatives, transportation experts and stakeholders to lead the initiative. 
2

for the Future: A Roadmap for the West.2 The policy roadmap and detailed team reports 

identify what is technically and economically feasible and what is needed to increase the 

usage of alternative fuels. The objectives of the roadmap are to identify the steps to 

diversify transportation fuels energy sources, increase the fuel efficiency of the 

transportation system, and increase domestic production of transportation fuels. An 

overarching principle is to promote regionally produced clean fuel substitutes to enhance the 

local, regional, national, and global environment. 

These reports served as the basis for the policy resolution adopted by the Western 

Governors on February 23, 2008: Transportation Fuels for the West: A Roadmap for Energy 

Security and Improving the Environment and the Economy.

3

 The Governors’ acceptance of 

the Transportation Fuels for the Future Report on February 23, 2008 in a sense concluded 

the policy formulation phase. It is now up to the states and the region collectively to 

implement the policy recommendations. 

The Transportation Fuels initiative was a collaborative effort designed on the Western 

Governors’ Enlibra Principles4

 that guide their work on complex environmental and natural 

resource issues. 

 

2

 www.westgov.org/wga/publicat/TransFuels08.pdf 3

 www.westgov.org/wga/policy/08/TransportationFuels.pdf 4 Principles for Environmental Management in the West http://www.westgov.org/wga/policy/05/enlibra.pdf 
3

2 Production Scenario Development 

For the CDEAC report the Biomass Task Force considered only electricity as a product from 

available biomass supplies. In this strategic analysis two biofuel deployment scenarios are 

examined. The two scenarios are a “2015 Potential Growth” and “2015 Moderate Growth” 

Biofuels scenarios. 2015 Potential Growth is the mirror image of the CDEAC electricity case 

for transportation fuels. Using the new technology optimization routine built into the UCD 

deployment model, UCD generated a supply curve for 2015 that utilizes all of the available 

resources for fuels production. The model builds Biofuels plants at strategic locations until a 

target product price is exceeded. Moderate Growth considers a slower build up in 

lignocellulosic Biofuels capacity that is likely to occur without strong incentives for switching 

to the feedstock (both to harvest and convert it to fuel) at a large scale and only modest 

Federal investment in technology improvements beyond the first pilot plants. 

A target maximum price for Biofuels is set that corresponds to the Target Product Price 

(TPP) established for the CDEAC electricity case. The value for the CDEAC analysis was 

established as a cutoff for the wholesale price of power that was considered a reasonable 

price to pay for renewable bulk power in 2015. The CDEAC pegged the maximum target 

price for renewable power in the West at $80/MWh. The WGA analysis team determined 

that this would be a 38% premium above the average wholesale price of conventional 

power in the Western States in 2015. The price escalation is based on EIA data on the 

baseline energy prices (December 2006) and the AEO 2008 reference case forecast for 

future power price escalation in the West to 2015.5

 The AEO 2008 forecast projects 2% deescalation in retail electric prices between 2006 and 2015. We assumed that wholesale 

prices would escalate at the same rate as retail prices on average, primarily because 

fuel/feedstock costs are the primary driver of energy price escalation. 

2.1 Scenario 1: Forecast for Biofuels Development without 

Competition from Biopower 

On parity with the CDEAC assessment for Biopower, the target prices for Biofuels delivered 

to the terminals in the Western States by 2015 were set at $2.40/gge for gasoline 

replacement and $2.36/gge for diesel replacement.6

 At that price the model predicts a 

potential Biofuels production capacity of 7.6 Billion Gallons per Year (gasoline equivalent) 

Error! Reference source not found. provides the forecast production mix in the West for 

the leading Biofuel contenders. For comparison, EIA projects the wholesale price of ethanol 

in 2015 will be $1.71/gallon ($2.61/gge). 

 

5

 AEO 2008 Reference Case Table A8 Electricity Supply, Disposition, Prices, and Emissions 

6

 Equivalent to $20.71/MMBtu for gasoline replacement ($1.58/gallon of ethanol) and $20.29/MMBtu for diesel 

replacement fuels ($2.43/gallon of Biodiesel) paid at the terminals for distribution. 
4

Table 1- WGA Forecast for Biofuels Production Potential by 2015 

Technology Technology Category

Volume Product GE Current Emerging

Dry Mill Ethanol 3,996 Ethanol 2625.4 2625.4

Wet Mill Ethanol 335 Ethanol 220.1 220.1

LC Ethanol 6,716 Ethanol 4412.4 4412.4

LC Middle Distilates 0 Diesel

FAME "Biodiesel" 0 Biodiesel

FAHC "Renewable Diesel" 276 Diesel 305.3 305.3

LC Gasoline 0 Gasoline

Total 11,323 7,563 2,845 4,718

Note GE = Gasoline Equivalent based on LHV per gallon of fuel 38% 62%

Output Fuel (MGY)

All of the scenarios begin in 2007 with an established production capacity in the Western US 

of 2980 MGY ethanol and 170 MGY Biodiesel using current production methods and 

feedstocks - corn and oil seed/animal fat respectively.7

 The forecast growth in production 

capability between 2006 and 2015 is illustrated in Error! Reference source not found.. 

Both “Potential Growth” and “Moderate Growth” cases are evaluated. 

Forecast Growth in Biofuels Capacity 

0

5,000

10,000

15,000

20,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Capacity (MGY)

Potential Growth

Moderate Growth

2015 US Forecast for Transporation Fuel Demand 231,000 MGY (EIA AEO 

2008 Reference Case). Western Biofuel Potential in 2015 represents 5% 

RFS mandates 15,000 MGY ethanol by 2015

11,300 MGY potential includes 

6,700 MGY LC Ethanol and 

4,300 MGY Corn Ethanol by 2015

7,100 MGY forecast includes 

2,500 MGY LC Ethanol and 

4,300 MGY Corn Ethanol by 2015

Figure 1 - Forecast Growth in Biofuels Capacity 

 

7

 While corn based ethanol production is forecast to continue to rise and eventually plateau the analysis team did 

not use the same degree of precision in forecasting the continued operation of FAME facilities. In reality many of 

these facilities will continue to operate although with price pressure on feedstocks from then new technology FAHC. 

More importantly the team forecasts greater production of diesel substitutes in 2015 and a switch from soy to 

waste fatty acid resources. 
5

By 2015 the WGA projected mix of Biofuel production processes shifts to ethanol 

from lignocellulosic feedstocks and diesel from hydrotreatment of fatty acid 

feedstocks. The former is an extremely important shift in feedstock choices. 

Lignocellulosic feedstocks can be produced from a variety of sources without 

impacting food production capacity. Land use and harvesting constraints are 

necessary to assure that aspects of sustainability are met and they do limit the 

potential of this feedstock for fuel production.8 However within these constraints 

Herbaceous Energy Crops (HEC) now in trial or demonstration plots throughout 

the U.S. are expected to provide a key source of lignocellulosic feedstocks in this 

forecast expanding the ample resource base of forest, crop and urban residues by 

a factor of two. 

The following essential points should be kept in mind when interpreting the results of the 

strategic analysis: 

• The specific mix of production technologies will change as new Bioenergy technologies 

described in this report achieve cost targets below the expectations described in the 

technology section increasing their potential for market share in production. 

• Alternatively some technologies will experience setbacks in development delaying their 

impact. 

• The Potential Growth trend line represents a four-fold increase in Biofuels representing 

the amount of production capacity that could be online and meet the target price by 

2015 if the representative technologies meet their development goals in the next few 

years and achieve widespread commercial acceptance. 

• The Moderate Growth trend line represents a slower likely build up of production due 

largely to the slower rate of injection of investment in technologies that are just entering 

the commercial market with a very limited track record and only modest government 

support. 

Achieving either the potential growth or realistic growth forecast for Biofuels production is 

dependent on the following critical assumptions: 

• A combination of government incentives and standards will be in place by 2010 to close 

the projected gap in pricing between the target price9

 for Biofuels and the DOE forecast 

prices for conventional fuels in 2015 while assuring the sustainability of the resource. 

Alternatively, conversion technology and feedstock production innovations that exceed 

the Biofuels cost and performance projections will also reduce the gap. Conventional fuel 

price trajectories above DOE forecasts10 used in this report will have a similar impact on 

Biofuels competitive position. 

• Biomass feedstocks must be established, harvested and delivered at the prices projected 

in this study and described in Chapter 1. This target is readily achievable but advances 

in yields and harvesting technology while managing sustainability are needed to enhance 

the competitive position of Biofuels and encourage rapid deployment. Ramping up the 

production of energy crops component of supply at the projected pace will be especially 

difficult to achieve. 

 

8

 Specific examples of boundary conditions imposed on resources in this assessment include: limiting the 

production of native grass feedstocks to marginal farm and rangeland without the use of irrigation. 9

 The CDEAC pegged the maximum target price for renewable power in the West at $80/MWh. This equates to a 

38% premium above the average wholesale price of conventional power in the Western States in 2015. The same 

ratio was applied to the wholesale price for Biofuels. 

10 From 2007 to 2008 EIA increased it’s forecast price for retail gasoline in 2015 by 15% (Annual Energy Outlook 

reference case). 
6

• Public acceptance of large scale Bioenergy production rests upon governments providing 

the necessary safeguards to ensure sustainable production and harvest as much as it 

depends on regulating the environmental impacts of Biofuel production plants. 

• Biofuel Conversion Technologies represented in this report need to meet or exceed their 

cost and performance targets as described in Section 2. Furthermore, to ramp up 

production by 2015 they must demonstrate that they can achieve the projections11 by 

2010 and are ready to build at full scale by 2012. 

2.2 Comparing Potential Growth and Moderate Growth 

Biorefineries using new technologies have only a four year window to achieve the potential 

deployment determined in this analysis for 2015. This is by far the most difficult technical 

challenge for meeting the potential supply targets. It means that as the technology is being 

proven potential new sites and investors are being lined up at the projected pace. Even then 

the time frame is extremely short. The “Moderate Growth” forecast takes these factors into 

consideration and represents a case where private and government investment in the 

technologies remains at current levels. In a like manner, the biomass feedstock resource 

must be developed at a comparably rapid rate. The assessment team believes that if the 

other targets are met, this can occur at the pace projected. The most serious policy hurdle 

to this rapid development will be questions surrounding sustainability of the resource and 

ensuring ecologically sound establishment and harvest methods. There are frameworks in 

place to support this process but failures in this arena and any resulting negative public 

reactions will slow development down. 

Error! Reference source not found. provides key statistics for the potential growth 

trajectory for deployment of lignocellulosic ethanol production facilities on one of many 

possible trajectories toward the forecast production potential. 

Table 2 - Key Deployment Metrics for the Biofuels – Potential Growth Scenario 

Metrics - Cumulative Units 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Facilites Capacity MGY 3,150 3,660 4,060 4,360 4,581 4,711 5,081 6,916 8,961 11,323

Dry/Wet mill MGY 2,980 3,480 3,880 4,180 4,331 4,331 4,331 4,331 4,331 4,331

LCE MGY 0 0 0 0 70 170 570 2,370 4,370 6,716

FAME MGY 170 180 180 180 180 160 130 90 50 0

FAHC MGY 0 0 0 0 0 50 50 125 210 276

Feedstock (dry tons)

Corn 1,000 Tons 23,482 27,422 30,573 32,937 34,127 34,127 34,127 34,127 34,127 34,127

1,000 Acres 6,617 7,535 8,282 8,798 8,996 8,868 8,749 8,633 8,520 8,405

Forest LC resources 1,000 Tons 0 0 0 0 116 283 948 3,941 7,267 11,168

1,000 Acres 0 0 0 0 9 22 75 310 572 879

Agriculture LC residue 1,000 Tons 0 0 0 0 122 295 990 4,117 7,591 11,666

1,000 Acres 0 0 0 0 69 169 566 2,353 4,338 6,667

HEC LC resources 1,000 Tons 0 0 0 0 449 1,090 3,654 15,193 28,015 43,055

1,000 Acres 0 0 0 0 150 363 1,218 5,064 9,338 14,352

Urban LC Resources 1,000 Tons 0 0 0 0 198 482 1,615 6,716 12,384 19,032

Seed Oils 1,000 Tons 639 662 627 593 418 279 151 52 0 0

Waste Grease 1,000 Tons 14 22 43 54 145 161 157 163 171 198

Tallow 1,000 Tons 6 14 27 51 135 376 391 625 850 907

 

11 All the new generation technology plants scheduled for commissioning by 2010 will be pilot plants. 

Demonstrating achievement of the goals means that results at the pilot scale indicate that the cost/performance 

targets will be met at commercial scale allowing for scale-up and application of lessons learned at the pilot scale. 
7

The conversion of lignocellulosic biomass to ethanol via enzymatic hydrolysis and 

fermentation is currently a good representative of the first step beyond starch based 

technology for ethanol production. For that reason and other characteristics of lignocellulosic 

feedstocks it can also avoid or minimize the impact on food production. Lignocellulosic 

feedstocks are currently produced from woody biomass from forested land that is not in 

agricultural production and from the byproducts of food production so that both food and 

fuel are produced simultaneously. In the near future energy crops can add to the feedstock 

supply. The impacts on food production can be minimized even when the crop is a dedicated 

energy crop to the extent that best management practices are adopted and the crop is 

grown on “marginal cropland” that is less suitable for high yield food crop production typical 

in the U.S. For example lands with this designation in native grass mixtures can be 

harvested without foregoing benefits of soil conservation given constraints on certain land 

base climatic and physical attributes. Clearly if the value of energy outstrips food products 

then only regulation will inhibit the conversion of prime irrigated farmland. 

The overall endpoint for the production levels by 2015 is determined by the analytical 

methods described in this report. However the temporal distribution of the plant additions is 

based on the best judgement of the analysis team. Early demonstration for LCE 

technologies beginning in 2010 is critical to the entry of these technologies and the 

associated feedstocks in time to have an impact on Biofuel production by 2015. 

Feedstock choices are critical to the future of Biofuels production. While corn is the predominant resource 

today and we have projected on an economic basis that production in the West could double the analysis team 

is forecasting that lignocellulosic feedstocks would be the predominant feedstock choice by 2015. This 

projected switch in feedstock choices (symbolically from the corn kernel to the stalk) is considered crucial to 

the long-term sustainability of the technology. 

 indicates the rapid ramp-up of herbaceous energy crops needed to meet the forecast 

potential Biofuels production by 2015. 

0

5,000

10,000

15,000

20,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Acreage in Production (x1,000) 

2008 US Acreage: Corn (86 Million), 

Sorghum (7.5 Million),CRP (28 Million) Productive use of 14 

Million Acres Marginal 

Lands in the West

Figure 2 - HEC Land Development Forecast 
8

The challenge of establishing this acreage is every bit as daunting as developing the 

corresponding Biorefinery capacity in the “Potential Growth” scenario. All of the land 

necessary to meet this level of HEC planting was selected from suitable acreage available in 

the West. A key limitation that the analysis placed on HEC feedstocks is that the resources 

would only be developed on non-irrigated land and subject to select sustainability criteria 

concerning climate and field-level physical attributes. It is a self imposed limitation for 

both practical reasons and for policy reasons – energy feedstocks should not 

significantly impact acreage for food production. It is possible that future land use 

policies at the state or federal level could discourage the use of certain crops (but not the 

crop residues) for Biofuels production. However it is more likely that with appropriate 

regulation of the types of land designated for Biofuels crops, energy production would not 

threaten food production. 

2.3 Variations on the Baseline Resource Projections 

Six sensitivity analyses were performed; four resource sensitivities and two technology 

sensitivities. The analysis team believes that all of these alternative scenarios have validity, 

under the circumstances described for each below. These alternative scenarios help drive 

home the conditions under which Bioenergy production could be accelerated or constrained 

depending on policy and technology research and demonstration successes or setbacks. An 

overview of the analyses and results is given below. A more detailed discussion of each 

sensitivity case is provided in Chapter 3. 

2.3.1 Increased Forest and Herbaceous Energy Crop Yields 

There is large uncertainty associated with the resource assessments for forest resources 

and for native grass energy crops. The rise in interest in alternative fuels has sparked 

significant private and federal investment in the development of Herbaceous Energy Crops 

(HEC) to provide an expanded resource for lignocellulosic ethanol production. Yields in 

highly managed and irrigated experimental test fields have approached 10 tons per acre per 

year dry biomass feedstock. The analysis team found sufficient scientific evidence to feel 

comfortable projecting a yield increase 50% greater than the baseline case under Western 

climate conditions and light field management practices by 2015 (Cassida 2005, Hooper 

1999, Schmer 2009). The results indicate a potential increase in Biofuel production in the 

West of 15% compared to the baseline at the target price. This increase is indicative of the 

potential for greater production if higher yields and better management practices are 

achievable. The interesting result is that although LCE Biofuels production increases by 20% 

the amount of land in HEC plantings decreases by 10% due to more efficient use of the land 

base for feedstock production. This efficiency has important implications for sustainability 

and farm profitability. 

There were also two forest resource assessments performed by Ken Skog et al., of the 

Forest Service, to capture the uncertainty in forest-based biomass supply. In addition to the 

baseline, a “high forest” case assessment was performed. The result of switching to a “high 

forest” case in the integrated supply curve is an increase of 850 million gge per year in 

Biofuel production at the $2.40/gge, and an even greater increase of 1,500 million gge per 

year at $3.00/gge. 
9

2.3.2 Corn Commodity Price Variations 

One limitation of this analysis is the treatment of corn supply as available at a single 

projected commodity price. The baseline case uses a price of $3.05 per bushel from the 

FAPRI projections for supply and price for 2015. The single commodity price causes corn 

ethanol to have a very flat supply curve. We performed three sensitivities of corn price by 

increasing or decreasing the price by 50 cents per bushel, and another increasing the price 

by $2.00. We found that lower corn prices would have a large impact on the quantity of 

biofuel available at the target price, increasing production to 11 billion gge per year. Higher 

corn prices eliminated the fuel produced from corn at the target price. 

2.3.3 Limitations to Crop Production for Biofuels 

Recent articles have called into question greenhouse gas emission benefits attributed to 

Biofuels produced from crops (corn, seed oils and herbaceous energy crops) due to induced 

land use changes, including indirect impacts. If these findings prove to be valid for the crops 

grown in the WGA region, the Biofuel industry could have a significantly smaller resource 

base to work with. The impact of removing corn, seed oils and herbaceous energy crops 

from consideration results in a 66% reduction in Biofuels production. 

2.3.4 Slower Technology Development 

The development of a Biofuel technology that meets the projected performance of 

lignocellulosic ethanol technologies in this analysis is important to achieving the supply at 

prices shown in the results. To bound the impact of this technology improvement, we have 

performed a scenario of stalled technology where the lignocellulosic ethanol technology only 

achieves the near-term performance described in the Task 2 report. This includes 

significantly higher conversion costs and lower yields. At this lower level of performance the 

supply of Biofuels is significantly reduced at the target price (22% of baseline). From 

another perspective, it will take $0.28 per gge more to induce the same quantity of fuel 

production at the same technology status. This represents a shift from lignocellulosic 

resource use to a larger reliance on corn-based ethanol. 

2.3.5 Scaling Up Biorefinery Production Plants 

By building larger Biorefineries, the fixed costs can be spread over a larger quantity of fuel 

produced. In this analysis, we account for these economies of scale but we place a cap on 

the size of the Biorefinery. It is uncertain at this time what the maximum size of these 

facilities will be. We analyzed the sensitivity by increasing the maximum capacity of the LCE 

Biorefineries from 100 MGY to 200 MGY while holding the unit cost of conversion constant 

beyond 100 MGY. This resulted in only a small cost savings at the low end of the supply 

curve, which resulted in an increase of about 8 million gge in biofuels production at the 

target price. This occurs by improving the economics of Biofuel production in areas with 

very high density resource bases. 

2.4 Facility Design and Siting Trends 

For all scenarios, waste minimization is an essential design objective for the Biorefinery. 

Maximum use of all the resource delivered to the Biorefinery gate is important to both 

economics and sustainability. In contrast to petroleum refineries, the Biorefineries are not 
10

only producing renewable fuels for transportation; they are using renewable resources to 

provide power and process heat to the plant further reducing the dependence on 

nonrenewable energy.12 This is a similar effect to using Biodiesel for farm and forest harvest 

and transport equipment in the feedstock production and delivery portion of the system. 

Reviewing the spatial distribution of Biorefineries forecast by the model, the most active 

areas of development will be the states bordering the Great Plains and the Pacific Coast. The 

combination of soils, weather and existing agriculture give these states an advantage in the 

deployment scenarios. 

While the analysis looks toward future Biofuel production in this work, the more than 125 

existing corn ethanol facilities in the Western Region represent a significant investment and 

ongoing production capability. To capture the financial advantages of these facilities, the 

analysis evaluated their conversion costs in the future supply mix. The capital costs for each 

existing facility are discounted based on the age of the facility resulting in reduced 

conversion costs. The existing facilities are then modeled in the optimization with two 

potential outcomes. They either operate at full capacity if profitable or they close and are 

replaced by newer technologies. 

2.5 Multiple Bioenergy Products: Biofuels, Power and CHP 

A third important scenario is the multi-product scenario wherein heat, power and fuels all 

use a share of the resource in proportion to established economic criteria for each 

component. The analysis team did not propose to perform detailed energy market 

simulation modeling but agreed to indicate which resources and technologies are likely to 

provide more competitive products at intermediate points along the supply curve for 2015. 

Biomass can play a dual role in the nation’s ability to meet transportation energy needs 

without increasing GHG emissions. Biofuels will play an important role in supplying the 

nation’s liquid fuels and can contribute to the continued diversification of fuels for power 

production. To the extent that electricity increases its share in providing energy for 

transportation service via a transition to “plug in hybrid” and other electric drive vehicles, 

Biopower can serve the transportation sector through power production. In the modeling 

efforts cited in this report most lignocellulosic Biofuel conversion facilities produce power 

and steam from energy rich byproducts to meet on site demand. In some cases there is 

excess generation that can be supplied to the grid. Thermochemical conversion routes for 

biomass offer the special flexibility of allowing plants to produce both Biofuels and Biopower 

each as a primary product. That flexibility could provide an important market edge in the 

future. 

Unless public policy drives the resource predominantly to one product, there will be active 

competition between Biopower and Biofuel project developers. There are signs of that 

competition already as the pilot lignocellulosic Biofuel plants are being developed and come 

on line while utilities and independent power developers are taking advantage of RPS 

incentives for renewable power. The winners in this competition will be the projects that can 

extract the most value from the resource and can afford to compete for the available 

biomass feedstocks. The WGA CDEAC and Biofuels Strategic Assessment results for the year 

 

12 A similar trend is evident at petroleum refineries where increasing amounts of byproducts are being gasified to 

fuel combined cycle power resources on site. Pulp and paper facilities have for many years self generated power 

and steam from waste wood. In the petroleum case the byproducts are not renewable. 
11

2015 provide an interesting view of the potential competition for lignocellulosic feedstocks, 

as shown in Error! Reference source not found.. 

The Biofuels Assessment included HEC resources which are forecast to be a key component 

of the supply for Biofuels. The Biopower assessment at the outset concluded that energy 

crops would not be a key supply for power projects based on project fuel prices. This implies 

that the HEC portion of the supply would be largely dedicated to fuels production with little 

competition from power projects. This assumption is analogous to the assumption that seed 

oils, tallow and greases would be directed toward Biodiesel production rather than power 

based on feedstock costs. Whether these assumptions will hold up in the future is open to 

debate. Clearly the greatest area of competition for lignocellulosic resources will be in the 

forest residues, agricultural residues and urban biomass categories. As a simple first order 

approximation of the competitive differences between power and fuels productions Antares 

used its model that predicts competition among Bioenergy projects with different 

characteristics, sizes and locations. For this case (location and actual plant size is 

generalized) we applied our projected facility costs and performance for power and fuels to 

provide a sense of the ability of those projects to compete for supply on the basis of price. 

Power projects have long benefited from the ability to convert many types of fuels to power. 

This has helped provide diversity in generation which helps to moderate electricity price 

swings and fuel costs. As more resources are drawn upon to supply energy to the 

transportation market, that sector will benefit from a diversity of resources. However that 

change will take time and for the 2015 time frame pressure in the transportation fuels 

market will tend to make Biofuel production the premium energy product if the new 

technologies succeed. For this evaluation Antares incorporated the capital costs and 

performance characteristics of both WGA led Bioenergy assessments and included Antares 

in-house model for a biomass repowering case.13 The product prices at the wholesale level 

were assumed to be the targets used in each report – $80/MWh electricity and $2.40/GGE 

gasoline substitutes. 

The results suggest that under the technology and energy price forecasts used in these 

assessments, Biofuels producers will generally have a competitive edge in feedstock 

acquisition, Error! Reference source not found.. Many factors will influence this relative 

ability to compete for feedstocks. One clear factor is plant scale. A plant consuming twice as 

much biomass as its competitor in the same supply shed will have to cover additional 

 

13 The Project entailed the repowering of a 160 MW coal fired boiler for a major utility in the Southeast. Project 

development was publicly announced in May of 2008. 

Biopower Feedstocks 

100 MDT/yr

31%

27%

42%

Ag Residues Forest Residues Urban Wastes

Biofuels Lignocellulosic Feedstocks 

85 MDT/yr

14%

13%

22%

51%

Ag Residues Forest Residues Urban Wastes HEC

Figure 3 - Comparison of Power and Fuels Feedstock Sources
12

transportation costs to reach supplies further on the periphery (c.f. IGCC and LCE examples 

below). Another factor that may be an important influence in this time frame is the ability to 

use existing infrastructure and distribution channels to reduce the initial investment risk. 

Power generation facilities that can be repowered with biomass and ethanol facilities or 

refineries that can expand production with lignocellulosic feedstocks could have a 

competitive edge over the establishment of greenfield facilities. Some of the DOE 

demonstration plants are adding a lignocellulosic feedstock processing facility at an existing 

corn ethanol facility to expand production capability. It is also possible with substantial 

investment that lignocellulosic feedstocks could be substituted for starch feedstocks at an 

operating ethanol plant with major modifications to the existing facility while preserving 

much of the infrastructure. This case we were not able to evaluate under the current scope 

of the project but could achieve the same order of capital cost reductions that a biomass 

repowering project enjoys. 

Table 3 - Estimated Feedstock Affordability by Technology 

Technology Capacity 

Feedstock 

Input (Green 

ton/yr) 

Max Affordable 

Avg. Cost 

($/Green ton) 

Lignocellulosic Ethanol (LCE) 100 MGY 2,116,600 47 

Greenfield Biopower – Steam Turbine 100 MW 943,600 26 

Greenfield Biopower – IGCC 100 MW 581,900 43 

Repowered Biopower 100 MW 995,500 41 

Notes: 

 Yields and feedstock input requirements for all facilities based on hardwood (i.e. poplar). 

 Target price for ethanol is $2.40/gge. The total installed cost for the LCE facility includes 

estimated cost for under a mile rail spur or barge unloading facility. The ethanol also 

includes transportation cost (average distance of 20 miles for each gallon of fuel 

transported, based on rail transport metrics). 

 Target price for power is $0.08/kWh. The total installed cost for the Greenfield biopower 

facilities includes substation cost plus under a mile for interconnection. No 

interconnection or substation costs are added to the repowered biopower facility. 
13

3 Policy Recommendations Supporting the Deployment 

Scenarios 

3.1 Barriers and Challenges to Biofuels Development in the West 

The Western region has significant biofuels potential. However, there are challenges to 

reaching this potential. Some of these challenges are unique to the West such as scarcity of 

water and agricultural conditions. Other challenges apply broadly such as the need for 

technology breakthroughs for advanced biofuels, including cellulosic ethanol. The major 

challenges to biofuels development are discussed below. 

Technology

Producing alternatives to starch-based ethanol such as LCE and biobutanol offers potential 

by using agricultural and forestry residues and dedicated energy crops thus reducing the 

potential food impacts we now see from our use of corn as the primary ethanol feedstock. 

However, the technology to produce LCE and biobutanol has not been demonstrated at 

commercial scale. Likewise, feedstocks such as municipal solid wastes are abundant but we 

have limited technological experience at commercial scale. 

Biodiesel technology is well understood and commercially viable today. Renewable diesel, 

which is being demonstrated in Europe, is just beginning to be developed in the U.S. 

Feedstock

The West has broad expanses of land that could be used for producing biofuel feedstocks 

including potential cropland, forests and waste. However, much of the West is unsuitable 

for growing irrigated crops because of climate, soil and water. 

Soybean oil has been the dominant biodiesel feedstock in the U.S. However, soybeans are 

only produced in approximately six states of the WGA region, and soybean oil will not be 

able to provide the feedstock base necessary to meet the growing demand for biodiesel/ 

renewable diesel in the distillate fuel market. Other potential oilseed crops include 

sunflowers, canola, cotton and peanuts. Future choice of feedstocks will be a function of 

many factors including: 

• Competition for acreage from other crops and for oil in other markets, 

• Availability of crush or ginning facilities within economical transportation distances, and 

• Market demand. 

While the technology to produce starch-based ethanol is well demonstrated, producing more 

than 12-15 billion gallons a year would require an unacceptable use of cropland by causing 

major crop shifts, impacting land committed to wildlife values, causing significant price 

increases, and possibly impacting food supply within this country and on a global scale. 

However, there is huge potential for lignocellulosic feedstocks using agricultural and forestry 

residues. The challenge in using agricultural residue is determining the amount of residue 

that can be removed to ensure sustainability in the future. Sustainability is also an issue for 

forest residue use. Access to forest residues is an additional challenge due to terrain and 
14

public sentiment. Dedicated energy crops such as perennial grasses are a potential new 

biofuel feedstock source. To be viable however, research is needed to determine growing 

conditions including soil, climate and water requirements. 

Both forestry and agricultural residue harvesting and treatment will require new and 

different equipment. Research into the equipment is needed, followed by commercial 

development. Investments by producers may be significant. Likewise, new cellulosic 

feedstock storage requires development of methods and mechanisms to meet the diverse 

conditions in the West. 

 

Production and Infrastructure

Key barriers for biodiesel and renewable diesel production include economics of the 

production process and uncertainty of the market. The economics are tight when the 

feedstock price is high. Market uncertainty factors include price elasticity for public 

consumption, product quality assurance, uniform labeling, and the need for public 

education. 

Large-scale cellulosic conversion systems will require large scale feedstock collection, 

handling, transport and delivery as well as potentially new technology. Technology needs to 

be developed and then acquired by producers. Additional work is needed in densification 

and pre-processing techniques and technologies. The transportation infrastructure that will 

be needed to move large quantities of feedstock to biorefineries will be significant, whether 

by road or rail. Truck transport can have major impacts on existing road systems with 

resulting impacts to communities. Again, public and private investment will be a challenge. 

Financing/Economics

The established technologies used for starch-based ethanol and biodiesel have been able to 

attract sufficient financing to become economically viable. For new technology 

development, financing continues to be a challenge. The Department of Energy (DOE) 

contracts for large- and mid-scale lignocellulosic facilities will help determine commercially 

appropriate technologies, but financing the early commercial plants may be difficult. 

 

Regulatory

Regulating new industries and products can be a challenge, particularly finding the balance 

between consumer protections and facilitating burgeoning development. 

Life-cycle Environmental Impacts

Environmental and societal impacts are becoming major issues in a future biofuels 

economy. Referring back to the goals above, we are seeking to produce alternatives to 

petroleum products while concurrently addressing environmental issues including 

greenhouse gas and air pollutants, limited water, and land use. Uncertainties about these 

environmental impacts are likely to become larger issues until they are better understood 

by decision-makers and the public. These uncertainties include greenhouse gas and water 

impacts of producing feedstocks and conversion systems and also greenhouse gas and other 

environmental impacts of changing land-use, including converting land to new feedstock 

production and changing agriculture from food to biofuel feedstocks. These are the direct 

land-use impacts. Extensive indirect land-use impacts are beginning to be identified. 
15

3.2 Policy Recommendations 

The Governors can agree on the goal to integrate alternative fuels into a transportation fuel 

portfolio, taking into account the specific resource attributes of the West. However, each of 

the Western states has differing environmental, economic, and societal issues that make 

adopting regional policies challenging. Each of the states has different resource potential 

for alternative fuels. And finally, each state has a different political environment that 

influences the scope of policy actions as well as their timing. 

It is increasingly clear that decisive leadership is needed at the federal and state levels to 

expand production in ways that deliver biofuels to consumers at lower prices, more 

efficiently and in greater quantities. The following recommendations are a set of state, 

regional, and federal policies that would work together to meet the aggressive goals under 

consideration. 

The necessary policy framework to take biofuels from an important but modest blend 

component of gasoline to a fuel source that replaces substantial quantities of transportation 

fuel produced in all regions of the nation would require the following actions: 

• Sustained expansion and improved alignment of research, demonstration and 

technology transfer efforts in the federal, state, and private spheres; 

• Innovations and support for cellulosic ethanol and other biofuel feedstock supply; 

• Steady increases in the demand floor for biofuels commensurate with the numbers of 

compatible vehicles; and 

• Innovative approaches to catalyzing the development of infrastructure for higher blend 

ethanol fuels and other biofuels. 

While wanting to expand alternative fuels, the Governors are concerned over how 

transportation fuel choices affect air quality, contribute to global warming and stress our 

water resources. Specifically, how do we minimize adverse environmental impacts? How 

do we track the numerous unintended consequences as we deploy new technologies and 

reallocate our resources? 

To answer these questions, it is recommended that the Governors promote tools to evaluate 

and monitor new alternative fuel technologies for the impact on the environment. Specific 

recommendations are: 

 Adopt a common life cycle analytic methodology and modeling structure to evaluate 

greenhouse gas emissions and land, air and water impacts. Regionally cooperate on a 

single, widely accepted set of assumptions and methods to improve cost-effectiveness of 

monitoring and facilitate trading of credits among states, if and when a carbon credit 

trading system is established. 

 Implement a regional framework for cooperation on the development of a performancebased greenhouse gas standard for transportation fuels. 

The following is a list of policy elements that can help achieve the Governors’ goals. Of 

utmost importance is an integrated strategy that ties these elements together in a 

coordinated fashion and considers the importance of collaboration across state and federal 

efforts. 
16

3.2.1 Research, Demonstration and Technology Transfer 

Technological breakthroughs and incremental process improvements are the bedrock of 

expanding production of ethanol and biofuels and, in particular, delivering the promise of 

cellulosic ethanol. Ensuring that we expedite delivery of needed technological 

breakthroughs requires vastly improving the coordination of federal resources and efforts 

with private and state efforts. The following are recommendations to help achieve the 

needed breakthroughs and improvements. 

 

National

• Advocate for full funding of DOE’s biomass research and demonstration activities, 

including its genomic work aimed at achieving dramatic changes in how ethanol and 

other biofuels are produced. Algae production could potentially enhance the biodiesel 

industry. However, funding and research facilities are needed to reach the potential. 

• Advocate for full funding of the Department of Agriculture’s (USDA) biomass research 

and development program at its authorized level. Funding to allow this program’s 

complementary focus on feedstock collection and other agricultural issues is essential, or 

it will become a weak link in the national effort to move toward cellulosic-derived fuels 

and other biofuels. Substantially greater leadership and resources are needed so the 

USDA’s unique expertise in the areas of plant biology, soil quality, and biomass 

collection can be used. 

• Structure federal incentives in a manner that provides additional per gallon amounts for 

cellulosic ethanol, based on the energy efficiency of the production process, including 

feedstock production; environmental impacts including water and land use; and the 

resulting carbon emissions. This system should be designed in a manner that 

encourages innovation by rewarding the development and use of feedstocks and 

processes with superior lifecycle environmental, energy and emissions profiles. 

• Advocate for DOE and U.S. Department of Transportation research, development and 

demonstrations on vehicle engine technology that more effectively uses biofuels. 

State

• Complement federally funded research with state research, development, and 

demonstrations in delivering appropriate feedstock production and residue removal. 

Potential resource inventories need to be expanded and evaluated in terms of 

agricultural science. 

• Actively partner with local companies in alternative energy projects, pursuing federal 

funding where applicable. 

3.2.2 Cellulosic and Other Biofuels Feedstock Supply 

A study undertaken by University of Tennessee14 looked at the economic, environmental, 

and agricultural impacts of increasing levels of ethanol production and use. The results of 

the study show that further expansion of production (10 billion gallons in 2010, 30 billion 

gallons in 2020, and 60 billion gallons in 2030) is well within the capability of the industry 

and farmers under conservative grain-yield improvement assumptions and market entry of 

modest amounts of cellulosic-derived ethanol production by 2012. 

 

14 http://www.energyfuturecoalition.org/pubs/UTReport.pdf 
17

Steps are needed to actualize this potential supply of cellulosic feedstocks for Biofuels. 

Currently there is no functioning market for perennial Biofuels feedstocks. There are 

uncertainties about the conditions under which these and other energy crops can even grow 

in the West. The following recommendations will support and encourage the transition to 

cellulosic feedstocks. 

• Provide government assistance to implement short- and medium-term burden sharing 

for producers. Expand technical assistance from the Natural Resources Conservation 

Service and the cooperative extension services. 

• Consider making funds available to cost-share purchases of new bioenergy harvesting 

machinery. 

• Establish a low-carbon renewable fuels loan guarantee program. 

• Re-evaluate the USDA risk management program and adjust, as necessary, to meet the 

needs of evolving bioenergy crops. 

• Consider establishing a regional ethanol reserve to maintain an assured supply. 

3.2.3 Increasing the Demand for Biofuels 

The ethanol industry now produces approximately 6 billion gallons annually, with an 

additional 6-10 billion gallons of production under construction or planned to come online 

over the next 5 years. The following recommendations are a set of state, regional, and 

federal policies that would work together to increase the demand for biofuels: 

National

• Consistent with greenhouse gas reductions and other environmental goals, support 

implementation of the expanded Renewable Fuels Standard (RFS.) 

• Determine market infrastructure needs for distributing biofuels and expand the market 

capacity to maximize current and projected future consumption patterns. 

• Consider the monetization of the cellulosic ethanol trading credit contained in the current 

RFS. 

• Because government fleets are in a position to be movers for alternative fuels, the 

federal government should promote procurement of flex-fuel vehicles, as well as 

renewable fuels, and ensure the availability of E85 and other renewable fuels fueling 

facilities. 

• Federal agencies can help establish income streams with long-term cellulosic ethanol 

supply contracts for federal and state purchases. 

State

• Promote procurement of flex-fuel vehicles, as well as renewable fuels, and ensure the 

availability of E85 and other renewable fuels fueling facilities. 

• Help establish income streams with long-term cellulosic ethanol supply contracts for 

federal and state purchases. 

• Consider adoption of a low-carbon fuel standard similar to that adopted by California, 

which is 10-percent reduction in the carbon intensity of transportation fuels by 2020. 

• Consider modifying their highway taxes to address the lower BTU content of E85. 

3.2.4 Production and Infrastructure 

National
18

• Tie infrastructure incentives to the increased penetration of alternatively fueled vehicles, 

i.e. for every one percent increase in flex-fuel vehicles sold, additional dollars will be 

made available for helping to increase the infrastructure development for that 

technology. 

• Adopt a city-to-region approach to solve the E85 infrastructure challenge by encouraging 

DOE funding of a high-profile competition providing funds to three metropolitan areas. 

• Promote federal and state cooperation in developing and enforcing biodiesel fuel quality 

and labeling. 

• Support long-term low interest loans for biodiesel and renewable diesel infrastructure, 

refining, oil mill and production agriculture. 

State

• Actively partner with local companies in alternative energy projects, pursuing federal 

funding where applicable, and consider the full gamut of financial incentives to 

encourage growth of the industry, including appropriate tax incentives and loan 

guarantees. 

• Establish goals for increasing E85 infrastructure and for supporting those goals with tax 

incentives. 

• Adopt incentives for retailers to sell E85. 

• Ensure biodiesel uniform labeling and adequate state agency education and funding for 

fuel quality assurance in production and distribution. 

Regional

• Plan for distribution of high-volume alternative fuels and other infrastructure 

components, including storage, rail and tanker trucks.

• Establish grants for renewable fuel infrastructure corridors in the West that serve all of 

the renewable and advanced biofuels. 
19

4 Evaluating the Benefits of Bioenergy Development in 

the Western States 

Renewable energy development offers an array of benefits to the nation and the Western 

United States. At the top of the list, renewable energy resources offer the capability to 

supply sustainable resources for the long term which can partially replace the consumption 

of the extensive but ultimately limited fossil energy resource. The concept of sustainability 

is a term that is rapidly being refined and attempts to quantify it are imperfect but both 

resource longevity and reduced impact on the environment are key components. Beyond 

the characteristic of providing a non-depletable resource, renewable energy is also favored 

for its potential to reduce the flow of Greenhouse Gases (GHG) into the atmosphere while 

providing energy services – a critical environmental benefit. Biomass can be said to play a 

unique role in the renewable energy portfolio. When the biomass resources used for energy 

production are wastes and residues from urban, forest and farm activities that would 

otherwise require some form of disposal or disposition, the energy alternative also displaces 

the alternative disposal fate for the residues. This ability to derive economic and 

environmental benefits from what might otherwise be environmental and economic liabilities 

is particularly attractive with significant implications for GHG mitigation. 

4.1 Converting Biomass Residues and Wastes to Energy 

There is a general consensus that within certain constraints the use of biomass residues or 

wastes to produce energy can have a profound impact on the reduction of GHG flows into 

the atmosphere. In the baseline scenario 35% of the resources for Biofuels production are 

derived from residues and waste sources (including forest residues; agricultural residues 

such as orchard & vineyard waste, corn stover and wheat straws; municipal solid waste; 

and tallow and waste grease). 

At the outset of the study the assessment team considered options for evaluating the net 

benefits associated with projected deployment scenarios. With limited resources the team 

pursued an adaptation of the benefits model used for the CDEAC study for Biopower 

development. That adaptation was partially successful in treating forest and urban residues 

and wastes as feedstocks but was not sufficiently complete with regard to agricultural 

feedstocks to report results for that sector. Realizing that the efforts required to complete 

that assessment definitively go well beyond the scope of this project, only the preliminary 

findings and qualitative discussion of the issues are included here as part of the evaluation 

of residue feedstocks. The use of biomass for alternate energy production does avoid the 

need for alternative disposal of residue feedstocks. While biomass energy production 

causes environmental impacts during fuels collection, preparation and conversion to energy, 

these impacts have to be balanced against the avoidance of impacts associated with an 

equivalent amount of energy generation from fossil fuels and the avoidance of the 

environmental impacts that would otherwise be caused by conventional or other alternative 

disposals of the biomass feedstocks converted to fuels. The latter effect, avoidance of 

alternative disposal of biomass residues, quantitatively is the largest single source of the 

environmental benefits per gallon of fuel produced.15

The net environmental impacts of biomass energy production are defined as the impacts of 

the energy-production and use pathway, less the sum of the impacts of the alternative 

production and use of the same amount of energy from fossil fuels plus the impacts of 

alternate disposal of the biomass residues converted to fuel. In order to analyze the net 

 

15 CDEAC 2006, Morris 1999, Morris 2000, Morris 2008 
20

environmental implications of using biomass resources for energy production, it is necessary 

to determine what the alternative fate of the biomass would be if it were not used for 

energy production. Avoidance of three alternative fates: open burning, burial in a landfill or 

open pile, or accumulated as overgrowth in the region’s forests have the greatest impact on 

GHG reduction. Open burning produces as much as 100 times more conventional pollutants 

than conversion to fuel and controlled combustion of the fuel in an engine, and greater 

quantities of greenhouse gases due to poor (incomplete) combustion conditions in open 

burning. Accumulation of forest overgrowth can have negative consequences for fish and 

wildlife habitat, reduces forest growth and resiliency to natural disturbance regimes 

(insects, disease, drought and weather events), increases the risk of devastating wildfires, 

and degrades the functioning of forested watersheds, both with respect to the amount and 

seasonality of water production, as well as water quality and sediment delivery to domestic 

water impoundments (Morris 1999, Morris 2000, Morris 2008). By contributing to forest 

health and fire resiliency in currently at-risk, overstocked forests across the West, in the 

long term energy production from forest fuels can increase the amount of carbon that is 

stored on a sustainable basis in the earth’s forests, making a positive contribution to efforts 

to control atmospheric greenhouse gas levels. At the same time best management 

practices require that some portion of the residues from forests and fields must be left on 

the land replenish and protect the soil. 

Landfill burial of segregated woody biomass, which can be diverted for productive uses such 

as recycled products or energy production, consumes available landfill space, and produces 

much greater quantities of greenhouse gas emissions than controlled combustion of the 

diverted material. However collection and use of landfill gas as a fuel for power production 

has made significant strides in reducing this environmental burden and is a growing part of 

the biomass energy portfolio for the West. The energy production pathway provides an 

environmentally superior beneficial use for the biomass residue that is being converted than 

any of the alternative disposal options that are available. 

There are a wide range of values reported for the emissions and water use for various steps 

in the field to fuel processes (refer to the accompanying report volumes on biofuel 

technology conversion and biomass resources for more details). Of the various impact 

categories considered in the model, the greenhouse gases contribute approximately 80 

percent of the total value of the ancillary benefits. This value is calculated using the basecase value of $20 per ton of CO2 equiv. for greenhouse gases. Using the current US value 

for greenhouse gas emissions of $3 per ton as the lower boundary, and the current EU value 

for greenhouse gas emissions of $30 per ton as the upper boundary, produces a range of 7 

to 30 ¢ per gallon of Biofuel produced for the ancillary benefits of biomass fuels production 

depending on many factors. For the residues this value is highly dependent upon 

assumptions about alternative fates discussed above. These are very preliminary findings 

based on GHG generation factors for each step of the process from field to fuel (well to 

wheel) compiled from many previous studies.16 As such the assessment team believes that 

they are more an indication of the positive trends for the use of residue resources than 

absolute values that can be taken to the bank (literally in the case of the emerging and 

growing markets for emissions trading). The WGA recommends that a single consistent 

platform for benefits analysis that is transparent to all who review the inputs and results will 

be a cornerstone for properly valuing the net benefits of Biofuels in the West.

 

16 Such as Delucchi 2003, Sheehan 1998, Wu 2006. Refer to emissions discussion in Task 1 and Task 2 reports for 

additional details and sources. 
21

4.2 Land Conversion Impacts of Bioenergy Development on 

Biogenic Carbon Neutrality and Food Production 

The issue recently raised by energy research, policy and environmental organizations is that 

the Bioenergy carbon accounting analysis should take into account the full impacts of 

conversion of land to energy crops for Biofuels production.17 What is the impact of land 

conversion on food production capability (including feed for livestock) and carbon 

accounting for biomass energy production? The term carbon accounting or carbon neutrality 

as used in this report encompasses the carbon equivalents of all significant sources of 

greenhouse gases contributing to global warming such as emissions of N20 and CH4. 

Bioenergy systems are carbon neutral with respect to the carbon that is embodied in the 

biomass to the degree that biomass regrowth occurs at a rate that replenishes in the near 

term the biomass feedstocks used. The biogenic carbon in the biomass is already part of 

the linked stocks of carbon in the earth’s atmosphere and biosphere. However, Bioenergy 

systems can affect biogenic carbon stocks and flows in ways that can be positive in some 

cases, and negative in other cases, with respect to their affects on atmospheric greenhousegas levels. For example, on the positive side, the use of a variety of biomass-residue 

resources for energy production reduces the potency of the greenhouse-gas emissions 

associated with alternative disposal options for the residues, such as open-air 

decomposition, burial or open burning, by replacing environmental CH4 emissions with CO2

emissions. Unlike Bioenergy, fossil-fuel combustion will always add new carbon to the linked 

stocks of atmospheric and biospheric carbon until carbon capture and sequestration (CCS) 

systems are proven to be long lasting and economic. By contrast application of CCS to 

Bioenergy systems can change Bioenergy production and use to a net sink for carbon and 

that is a very attractive advantage for Bioenergy technologies. 

On the negative side, the production of biomass resources can lead to significant losses of 

fixed biogenic carbon, for example due to the clearing of land in anticipation of establishing 

a crop, as well as losses of soil-bound carbon due to tillage and other agricultural or 

silvicultural practices. In addition, biomass resource production can lead to potent 

greenhouse-gas emissions in the form of N2O from the use of nitrogen fertilizers. Emissions 

of biogenic and non-carbon greenhouse gases due to land clearing and subsequent carbon 

emissions from fossil fueled operations involved in the production of biomass resources are 

not covered by the carbon-neutral attribute of biomass energy. The rate of regrowth with 

carbon intake compared to the energy portion of the harvest and carbon emissions from site 

conversion is the key determinant of carbon neutrality. The portion of the harvest that is 

converted into forest products continues to sequester the carbon. 

When the resource is produced primarily for a non-energy application, such as food or fiber, 

then it can be argued that GHG emissions can be attributed, in whole or part, to the primary 

objective of the agricultural enterprise. This appears to be reasonable in cases like the use 

of residues for energy production, such as corn stover for lignocellulosic ethanol production, 

as long as sufficient residues are left in the field to sustain corn production. When additional 

fertilizer must be added to make up for nutrient loss then that must be ascribed to the 

energy system. In terms of the corn grain itself, which is used for conventional ethanol 

production and livestock feed, the carbon equivalent emissions should indeed be assigned to 

 

17 Mitigation of climate change is a policy goal of bioenergy development in many countries. However, life-cycle 

analyses that measure emissions throughout the bioenergy production chain indicate a wide divergence in carbon 

balances according to technologies used, locations and production systems - with some even leading to greater 

emissions than fossil fuels. Food and Agriculture Organization (FAO) of the United Nations, Web Document 

http://www.fao.org/bioenergy/47285/en/
22

the energy system, in proportion to the mass of products produced - energy versus 

food/feed products. 

4.3 WGA Strategic Assessment Approach 

The WGA analysis suggests that the production of Biofuels from lignocellulosic feedstocks is 

the future of the industry. Therefore the emphasis in our assessment is on the impacts of 

using lignocellulosic biomass for large scale future energy production. Nearly half the 

projected lignocellulosic biomass resource for 2015 is derived from residues from other 

activities (such as forest thinning, timber milling, corn production). In this case there is no 

land conversion as the land remains in its current predominant productive use, e.g. food 

production or timber production. For the cases where energy crops are established, land 

conversion is a necessary step. The carbon accounting analysis should consider what the 

carbon emissions and uptake would be in two cases – (1) let the land be preserved in its 

current use and (2) convert the land to long term Bioenergy production. The complicating 

factor is projecting the alternative fates or end uses for the standing biomass harvested 

from the land and converted to Bioenergy crops, while considering current management 

practices on the land which allow for soil tilth maintenance for example. Conversion 

materials harvested in site preparation to products or Bioenergy (meeting demands for fiber 

or displacing fossil fuels) can potentially involve positive outcomes. There are several direct 

impact scenarios to consider for lignocellulosic Bioenergy development. In each case we 

indicate under what circumstances the condition of near carbon neutrality is maintained for 

Bioenergy production. With appropriate policy and regulatory safeguards to assure that 

these conditions are achieved, a significant portion of the energy needs for the Western 

states can be satisfied with biomass on a large scale while accruing the environmental and 

economic benefits associated with Bioenergy. 

For each of the many land conversion scenarios we identify the possible products of land 

conversion and then indicate under what conditions carbon neutrality and food production 

capacity can be maintained. For this study we are focused on land conversion practices as 

they occur in the United States, especially the Western States, and not as they might unfold 

globally, although these same principals can apply in similar climate and economic 

conditions. We expect research will continue in this area to determine more precisely the 

degree of balance in these outcomes. 

Land conversion scenarios with direct impact on carbon neutrality include: 

1. Conversion of forest land to Bioenergy crops: this is the reverse of a longstanding 

trend in the U.S. where former agriculture land has been allowed to revert back to 

forest land as agriculture has diminished particularly in the eastern U.S. In this case 

the forest biomass will in most cases be harvested for commercial purposes to 

capture the value of the existing biomass. 

a. Conversion harvest products include: timber, pulp or fiber chips, mulch, 

animal bedding and Biofuel feedstock material 

b. Conditions for maintaining carbon neutrality: the conversion harvest produces 

timber which maintains long term carbon sequestration, pulp which can 

maintain long term sequestration to the degree that the fiber is recycled, and 

Biofuels18 which displace fossil carbon emissions. Land preparation must 

 

18 This document assumes the future ability for lignocellulosic ethanol conversion processes to be able to accept a 

wide range of biomass feedstocks. In the case this cannot occur both on site power generation through 

combustion and landfilling with methane collection for power generation will serve to mitigate the carbon debt from 

the conversion process. 
23

minimize the disturbance of soil carbon to the extent practical but removal or 

grinding down the large root systems will likely incur a carbon penalty (20 to 

36% of the biogenic carbon can be retained in the root system). 

c. Conditions for protecting food production capacity: Conversion of forest land 

has no direct impact on food production for humans. 

2. Conversion of agriculture working lands (food/feed cropland and pastureland to 

Bioenergy crops: In the cropland case establishing a new crop should not incur a 

large deficit since the original biomass was also harvested and replanted for 

beneficial use without a large aggregation of carbon in long term storage. For 

pasture land the conversion has minimal direct impacts on the carbon stored above 

and below ground when no till methods are used. 

a. Conversion harvest products: food and agricultural residues 

b. Conditions for maintaining carbon neutrality: The agricultural residues are 

converted into Biofuels displacing fossil fuels. Land preparation must 

minimize the disturbance of soil carbon to the extent practical – best practices 

may include “no till” field prep, cover crops to reduce herbicides and 

optimized recovery of nutrients and application of fertilizers. 

c. Conditions for protecting food production capacity: Conversion of marginal 

cropland to bioenergy cropping scenarios will probably have minimal impact 

on food production for humans and actually may be better from an 

environmental/sustainability perspective due to increased carbon 

sequestration and soil and water quality benefits. Conversion of prime 

cropland to Bioenergy crops could possibly impact food production capacity, 

but these may potentially be offset if historic trends in food crop yields 

continue. To the degree that rate is exceeded, clearly food production will be 

adversely impacted with significant repercussions. 

3. Conversion of Conservation Reserve Program (CRP) land to Bioenergy: This is a 

special case. Crops like Switchgrass are conservation reserve crops and can maintain 

the conservation values while being harvested for productive uses. In this case 

unused biomass now goes to productive energy uses and the benefit is on the 

positive side of the ledger. Conversion of CRP to corn on the other hand has the 

opposite effect. The conservation values are lost but the productive energy use 

remains. 

a. Conversion harvest products: native or hybrid grasses for Biofuels 

b. Conditions for maintaining carbon neutrality: Harvests with adequate residues 

left to protect and enrich soils should maintain neutrality. 

c. Conditions for protecting food production capacity: Conversion of CRP to 

energy crops has no direct impact on food production for humans. 

4. Clear-cut forest land for energy harvests or development: In the U.S. this situation 

occurs where landowners have let agricultural lands revert to a forested condition 

without restocking and the result is largely unmerchantable timber and scrub 

vegetation. Once clear-cutting is performed the owner has a choice to restock the 

land or to again allow natural regrowth. When the land is being developed for 

housing and urban uses then the outcome is permanent conversion and the 

motivation for the harvest is no longer to produce energy crops. 

a. Conversion harvest products: fiber, mulch, bedding and fuel 

b. Conditions for maintaining carbon neutrality: Harvested biomass converted 

into fuel, displacing fossil fuels, or to fiber for building products will largely 

assure neutrality. Land preparation for replanting must minimize the 

disturbance of soil carbon to the extent practical but removal of the large root 

systems will incur a carbon penalty. 

c. Conditions for protecting food production capacity: Site conversion of former 

agricultural lands has already occurred in this instance and maintaining it as 
24

forestland will have no impact on food production capacity. On the contrary if 

the feedstock harvest allows the land to be reestablished as farm land an 

increase in food production could occur. 

In all these cases a common variable directly impacting carbon neutrality is the energy 

required to harvest/collect and haul raw feedstock to the Biorefinery. To the degree that 

fossil inputs are used in this step – low density resources will decrease the net GHG and 

energy benefits. The spatial modeling done by UCD for this assessment has increased the 

resolution of the determining the impact of this variable. High yield systems that don’t 

proportionately increase fertilizer use and use for biofueled fleets for harvesting and hauling 

can alter the equation substantially. 

It is interesting to note that society has implicitly accepted the environmental consequences 

of land conversion and use in order to produce food and fiber crops, although significant 

efforts have been made on an increasing scale over the past several decades to improve 

domestic agricultural and forestry practices from an environmental perspective. However 

for energy crops, recent increases in food prices have been attributed by some analysts to 

the increasing use of corn for ethanol production in the U.S. Other analysts counter that 

food prices are responding to a variety of pressures, of which corn use for ethanol 

production is only one small factor. As this study suggests the fuel versus food equation for 

ethanol production changes markedly when the feedstocks are the lignocellulosic resources. 

There will be land-use conflicts and impacts associated with the production of these energy 

resources quite different from those associated with current biofuel technologies, and they 

can be minimized via appropriate land use and energy policy and regulation. 
25

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