Ann Swanson Executive Director Chesapeake Bay Commission

March 25, 2009 

## National **Advisory Council for Environmental Policy and Technology**  

# BIOFUELS & THE BAY

## Who is the Chesapeake Bay Commission?
 **Created in 1980**  **Legislative Authority**  **21 members**  **MD –**  **VA –**  **PA**  **Helped to establish EPA Bay**  **P rogram**   **Signatory and**  **Legislative Leader**



### Policy for the Bay

## Who is the Chesapeake Bay Program Leadership? **Governor of MD**

**EP A A**  **dministrator Governor of V**  **A Governor of P**  **A**

**Executive Council May**  **or of DC**

**Chair of Chesapeake**  **Bay Commission** 

# Point #1: **The Bay watershed is big**  **and well used.** Wa tershed area = 1 16,000 km 2 Wa ter surface area = 1 1,500 km 2 90% tidal waters impaired **Susquehanna R.**  **(55 % of flow)** 

Agriculture Barren Developed Forest Wa ter We tland

## Point #2: **We are not alone.**

**Nutrient Impacts in USA**

## 2007 **Bay Habitat**  **Health Report Card**   Measure of overall Bay habitat health:

- water quality

- habitat

- supporting food web  Data gathered from more than 150 monitoring sites throughout the Bay
.  University of Maryland’s Center of Environmental Science publishes the report card. Source: University of Maryland, Center for Environmental Science



## Point #3: **Overall Score: C -** 

## We cannot save the Bay without

**funding, market** 

**- based**  **incentives and/or regulation...**  IMPLEMENTING C2K (FY 2003 - 2010) 

## Projected Costs: $18.7 B Projected Income: 5.9 B Funding Gap: $ 12.8 B

**Point #4:**8



# Biofuels & **the Chesapeake Bay** 9 

## First Report of the Chesapeake Bay Commission **issued September 2007** 10 

# What are the Feedstocks of

Biofuels?  

## Natural Oils: animal fat, yellow grease, restaurant waste, algae, and oilseed crops like soy and palm oil. 

###  

## Sugars/Starches: corn, sorghum, sugar cane and beets, hulless barley. 

###  

## Cellulosic Biomass: perennial grasses, woody biomass, corn stover, wheat and rice straw.11 

## What is the “Bottom - line” for Biofuels and Water Quality?  

### Handled right , biofuels can be a source of substantial permanent new income for farmers and foresters, can help reduce greenhouse gases, and can reduce nutrient pollution to the Bay.  

### Handled w **rong** , biofuels can bring economic uncertainty, do little for greenhouse gasses, increase the cost of animal feed, and exacerbate nutrient pollution.12 

### Impacts of Alternative Biofuels **Scenarios**

Watershed Delivered Load, Million lbs. N per year

**5.0 2.6** 

**-8.3**

**-17.1**

**-25.4 -30**  **-25 -20**  **-15 -10**  **-5 0**  **5 10** 

**Corn Soybeans**  **300K Switchgrass Corn w/ CC**  **1M Switchgrass (** **m i** **l l** **i o** **n l** **b s** **/ y** **e a** **r )** 13 

### Impacts of Alternative Biofuels **Scenarios**

Watershed Delivered Load, Million lbs. N per year

**5.0 2.6** 

**-8.3**

**-17.1**

**-25.4 -30**  **-25 -20**  **-15 -10**  **-5 0**  **5 10** 

**Corn Soybeans**  **300K Switchgrass Corn w/ CC**  **1M Switchgrass (** **m i** **l l** **i o** **n l** **b s** **/ y** **e a** **r )**  What if you were to combine switchgr ass with corn with BMPs?14 

## Cellulosic Biofuels Advisory Panel 

# Baseline Assumptions **Biofuels Project: Part II**15



## Current Generation

**Biofuels**  

### The future of corn - based ethanol in the region is uncertain;  

### Current U.S. energy policy calls for a doubling of corn - based ethanol production by 2015;  

### Regional corn acreage will likely max out at only 300,000 new acres, double the change from 2006 - 2007 while yields will rise; &  

### Any regional biofuel refineries will use feedstocks imported or from the Corn Belt.

Biof uels Advisory P anel Baseline AssumptionsCorn Production (Bushels)

Not estimated 1,000,000–4,999,999 5,000,000–9,999,999 10,000,000–14,999,999 15,000,000–19,999,999 More than 20,000,000 Choosing Our Future The Chesapeake region is the least invested in ethanol of any corn-growing region in the nation. 

## Choosing Our Future **The Chesapeake Region is the least invested in ethanol of any corn**  **- growing**  **region in the nation.**17 

## Next **- Generation**  **Biofuels**
 After 2015, next - generation biofuels will make up the remaining RFS increase to 36 billion by 2022 (20% of U.S. Transportation fuel).  Feedstock mix for the region is unclear but could include corn stover, other crop residues, cover crops, switchgrass and other perennial grasses, forest slash, wood residues, fast growing trees, municipal wastes or algae.  Key is to make choices that improve environmental conditions while remaining flexible to market and other forces. Biof uels Advisory P anel Baseline Assumptions18



## Environmental Issues

 

### The emphasis on regional environmental improvement from biofuel development is on nutrient and sediment reductions to the rivers and the Chesapeake.  

### Other issues include water supply and use, wildlife habitat, invasive plant species, greenhouse gas reductions and net energy benefits. Biof uels Advisory P anel Baseline Assumptions19



## Land Use Changes

 

### The potential scale of cellulosic ethanol and other next - generation biofuel development provide challenges and opportunities for:

 Mined area reclamation;
 Soil conservation and erosion control;
 Forest cover;
 Wildlife management;
 Use of pasture and underutilized lands; &
 Reduction of urban sprawl.

Biof uels Advisory P anel Baseline AssumptionsTo help protect your privacy, PowerPoint has blocked automatic download of this picture.



### The **Policy Recommendations**  **Report #2** 21 

### Three major subject areas where action is to

be focused: I. Feedstocks : Assuring a reliable and accessible supply of large amounts of biomass grown in the Chesapeake region. 

### II. Natural Resource Protection : Determining the types of biomass used, where they are grown, and the best management practices needed. 

### III. Marketing and Infrastructure : Harnessing the region’s opportunities for production capacity, distribution of feedstocks and biofuels, and marketing of biofuels and their co - products. **Policy Recommendations** 22 

# I. Feedstocks Coordinate regional input on U.S. Department of Agriculture conservation programs to promote sustainable feedstock production and harvest (Regional). Encourage local or on - farm use of biomass (Regional). Encourage winter biofuel crops as first - generation feedstocks (State). Ensure the nursery and seed industry has adequate supplies of feedstocks (State). **Policy Recommendations** 23 

# II. Natural Resource Protection Discourage use of invasive non - native feedstocks (Regional). Establish regional research priorities (Regional). Assure broad and ef

fective use of best management practices (State). **Policy Recommendations** 24 

# II. Natural Resource Protection Establish or update state removal guidelines for crop residues and forest slash and provide incentives for their adoption (State). Provide incentives for forest management plan development and implementation (State). Encourage sustainable biofuels production on abandoned or underutilized land (State). **Policy Recommendations** 25 

# III. Marketing And Infrastructure Coordinate regional action to secure funding from the 2008 Farm Bill, 2007 Energy Act, and 2005 Energy Act (Regional). Develop a regional carbon trading strategy (Regional). Establish biofuel market purchase requirements and incentives (State). Utilize state economic development programs (State). Focus facility support on small - scale, first - stage

operations (State). Establish a regional strategy to encourage greater use of higher blends of biofuels (Regional). **Policy Recommendations**

# 2009 : A Work in Progress 1) Review State Action Plans 

## 2) Develop a Regional Production Goal a. Necessary BMPs 

### b. Infrastructure and Marketing 

## 3) Examine nexus between biofuels and carbon markets/carbon sequestration.27 **For more information: aswanson@chesbay.us**  **410 -**  **263 -**  **3420**