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Friday, April 2, 2010

Renewable Energy Programs in the 2008 Farm Bill

Megan Stubbs
Analyst in Agricultural Conservation and Natural Resources Policy

The Food, Conservation, and Energy Act of 2008 (P.L. 110-246, the 2008 farm bill) extends and expands many of the renewable energy programs originally authorized in the Farm Security and Rural Investment Act of 2002 (P.L. 107-171, 2002 farm bill). The bill also continues the emphasis on the research and development of advanced and cellulosic bioenergy authorized in the 2007 Energy Independence and Security Act (P.L. 110-140). 

Farm bill debate over U.S. biomass-based renewable energy production policy focused mainly on the continuation of subsidies for ethanol blenders, continuation of the import tariff for ethanol, and the impact of corn-based ethanol on agriculture. The enacted bill requires reports on the economic impacts of ethanol production, reflecting concerns that the increasing share of corn production being used for ethanol had contributed to high commodity prices and food price inflation. 

Title VII, the research title of the 2008 farm bill, contains numerous renewable energy related provisions that promote research, development, and demonstration of biomass-based renewable energy and biofuels. The Sun Grant Initiative coordinates and funds research at land grant institutions on biobased energy technologies. The Agricultural Bioenergy Feedstock and Energy Efficiency Research and Extension Initiative provides support for on-farm biomass energy crop production research and demonstration. 

Title IX, the energy title of the farm bill, authorizes mandatory funds (not subject to appropriations) of $1.1 billion, and discretionary funds (subject to appropriations) totaling $1.0 billion, for the FY2008-FY2012 period. Energy grants and loans provided through initiatives such as the Bioenergy Program for Advanced Biofuels promote the development of cellulosic biorefinery capacity. The Repowering Assistance Program supports increasing efficiencies in existing refineries. Programs such as the Rural Energy for America Program (REAP) assist rural communities and businesses in becoming more energy-efficient and self-sufficient, with an emphasis on small operations. The Biomass Crop Assistance Program, the Biorefinery Assistance Program, and the Forest Biomass for Energy Program provide support to develop alternative feedstock resources and the infrastructure to support the production, harvest, storage, and processing of cellulosic biomass feedstocks. Cellulosic feedstocks—for example, switchgrass and woody biomass—are given high priority both in research and funding. 

Title XV of the 2008 farm bill contains tax and trade provisions. It continues current biofuels tax incentives, reducing those for corn-based ethanol but expanding tax credits for cellulosic ethanol. The tariff on ethanol imports is extended. 

Implementation of the farm bill's energy provisions is underway. President Obama, in May 2009, directed the U.S. Department of Agriculture (USDA) and the Department of Energy (DOE) to accelerate implementation of renewable energy programs. Notices and proposed rules have appeared in the Federal Register soliciting applications for the Biorefinery Program, the Rural Energy for America Program, and the Biomass Crop Assistance Program.

Date of Report: March 22, 2010
Number of Pages: 20
Order Number: RL34130
Document available electronically as a pdf file or in paper form.
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