February 28, 2007

FROM ROCK OIL TO SWITCHGRASS

By Senator Mike Crapo

Innovation lies at the heart of the American penchant for successful enterprise, as evidenced in our energy history. In 1859, Americans were feeling a financial pinch from the cost of whale oil. Used for lamps and lubricants at the time, whale oil was becoming increasingly unaffordable. A Pennsylvania company became interested in extracting "rock oil" from the ground. When the company was seeking financial backers for its proposed drilling project, historians note that one banker scoffed, "Oil coming out of the ground, pumping oil out of the earth as you pump water? Nonsense!" Although the first well was drilled a year later, demand for "rock oil" in the United States didn't really surge until the invention of the automobile early in the twentieth century. Over the past 30 years, technology creating renewable energy from wind, solar, nuclear and agriculture byproducts has increased in sophistication and application, and steadily decreased in cost. Since that time, the federal government has encouraged renewable energy development--efforts that have resounded strongly in rural agriculture-based communities. Still, as recently as 2005, biomass renewable energy production accounted for only 2.8 percent of the total energy production nationwide. Now is the perfect time to apply a full court press to renewable energy research and development, with the agriculture community, once again, leading the way. Congress is working on reauthorizing the Farm Bill; I serve on the Senate Agriculture Committee with jurisdiction over this reauthorization. This bill will provide an opportunity to build on valuable programs for research and development of biofuels and better support agriculture's role in renewable energy. Proposals, such as the Administration's proposed $1.6 billion in new funding for renewable energy research, development and production will be helpful as we seek ways to enhance energy use of agricultural products. In 2005, the USDA concluded that 1.3 billion dry tons of biomass could be harvested annually from U.S. forest and agricultural land without negatively impacting food, feed and export demands. This biomass could produce enough ethanol to replace 30 percent of current U.S. petroleum consumption.To promote innovation, the government can continue to provide incentives expanding agricultural participation in energy development. Ethanol production is exploding, but challenging market factors are becoming apparentâ??rising corn prices affect corn products used for livestock feed and human consumption. To counter this, Idaho is one of the states leading the way in the development of cellulosic ethanol. This week, the U.S. Department of Energy announced $80 million in federal funding toward the construction of a cellulosic ethanol plant near Shelley. Breaking down wood chips, switchgrass and agricultural waste into cellulosic ethanol creates an energy productive, waste reductive cycle. We can research growing non-food agriculture products for energy--in Idaho, products that can be grown considering the paucity of water and the variety of growing regions throughout the state. Potential energy sources must be evaluated for supply capacity, energy efficiency, market accessibility, available infrastructure and intellectual resources. Idaho meets or exceeds these criteria in many regions. Legislation such as the 2002 Farm Bill, Healthy Forest Restoration Act of 2003, American Jobs Creation Act of 2004, Energy Policy Act of 2005, and the upcoming farm bill and energy tax legislation in the Finance Committee are continuing to improve the climate in which we produce renewable, environmentally-responsible and home-grown energy. Our agriculture community plays an essential role in this process of development and production. It's important that we act not like the banker who couldn't imagine oil coming out of the ground, but like Edwin Drake, who devoted time, resources and risk to finding solutions to energy challenges 150 years ago. WORD COUNT: 599