Below is a series of questions and answers by Dennis Pennington and Steve Pueppke.

What is agri-energy (or bio-energy)?

Pennington: Bioenergy is useful, renewable energy contained in living or recently living biological organisms. Bioenergy can help reduce America's dependence on fossil energy as well as its carbon footprint. It also has the potential for rural economic development and growth.

Pueppke: Many scientific experts and policymakers view cellulose as one of the greatest potential contributors to bioenergy. The conversion of cellulose into motor fuels offers significant potential to Michigan, because we already produce large amounts of cellulose both in agriculture (corn stover is a good example) and in our forests. Michigan soils are also suited to produce dedicated biomass crops such as switchgrass, which could be grown solely for the purpose of producing motor fuels.

Another potential source of bioenergy is the conversation of waste materials, including animal wastes from dairies and other livestock operations, into methane. Such methane, produced in anaerobic digesters, could either be burned to produce heat or it could be used to power generators to produce electricity.

How does it work?

Pennington: There are two primary forms of energy derived from farm byproducts. First, biomass can be converted into usable transportation fuels like ethanol and biodiesel. Second, biomass can be burned as a source of energy for home heating and electricity generation.

Pueppke: There are several variations on the processes by which biomass could be converted into motor fuels like ethanol, but all share many features in common. Biomass is produced in either an agricultural or a forest system, harvested, and transported to a biorefinery, where it is converted into a fuel like ethanol. The ethanol is then transported to a site where it is blended with gasoline and moved on to service stations.

There are a number of key factors that have to be optimized to make this process work.

We need to maximize the production of biomass per acre and do so such that the soil remains healthy and productive.

Biomass is bulky and can be harvested at only certain times of the year (generally summer and early fall, when plants mature). Yet the biorefineries will have to operate year round in order to be efficient and cost effective, so biomass storage systems have to be developed.

The processes that turn biomass into ethanol within the biorefineries need to be optimized so that the process is cost-competitive with regular gasoline. It does no good to be able to turn biomass into ethanol unless it is cost-competitive.

We need to create opportunities for entrepreneurs in Michigan to invest in and manage parts of the biofuels supply chain.

In the case of methane, small scale anaerobic digesters are usually built right on farms or dairies, adjacent to the source of raw materials. These materials are fed into the digester, and methane is produce on-farm. There are several such facilities already in operation in Michigan, and all that I know of are running generators on farm and producing power.

Who uses it and for what?

Pennington: Ethanol and biodiesel are used for transportation fuels. The Clean Air Act requires certain cities with a high degree of smog to use oxygenates in their fuel system. Ethanol is a prime candidate to meet this requirement because it is renewable and is not a groundwater contaminant; as was found to be the case with MTBE (a petroleum based oxygenate).

Pueppke: The desire to reduce carbon footprints coupled with high fossil fuel prices has led to an increase in demand for biomass for cofiring in power plants as well as the development of a new industry in MI that collects and densifies biomass. Densifying biomass involves compressing the material into pellets or briquettes, which decreases transportation costs and improves efficiency of combustion systems.

What are the pros and cons of agri-energy?

Pennington: The primary “pro” of agri-energy is that we are cycling carbon that is already contained in our environment. Plants, through photosynthesis, take up carbon dioxide, convert it to sugars and carbohydrates for normal plant function and release oxygen. This carbon stored is stored in the plant until it is processed into a different form (i.e. ethanol). Ethanol is then burned in a vehicle engine, releasing some of the carbon back to the environment. If we were to use gasoline in our car, the carbon originates from fossil energy that has been stored underground for millions of years. Therefore, agri-energy has the potential to significantly reduce our carbon footprint.

Pueppke: One important “con” of agri-energy is the competition with food crops. Opponents cite high food prices as a result of farmers growing plants for energy production rather than food production. USDA and USDOE a study to examine how much biomass we need to produce and harvest in order to meet renewable energy policy mandates. This study, coined the “Billion Ton Study” estimates that it will take a billion tons of biomass per year in order to meet policy objectives. This has consumers concerned that farmers might start growing more energy crops and less food crops. Where will our food come from? Americans want a safe, plentiful and cheap supply of food. Proponents say that we have an adequate supply of farmland to fulfill the food and fuel needs of America. This topic has been debated in the past and will continue to be important in the future.

On the pro side, it is important to underscore that by reducing our carbon footprint through use of renewable fuels, we are reducing the rate of global warming. Another pro is that biofuels contribute to our energy-independence—every gallon of ethanol that we produce renewably is a gallon of gasoline that we will not have to produce from petroleum, much of which we import (at high cost) from unstable and unfriendly parts of the world.

Michigan is in a particularly good position to address the con argument that has been raised about food vs. fuels. We have millions of acres of agricultural lands that have been abandoned because they are not suitable for food production. If we can find an economically and agriculturally feasible way to bring these lands into production of biomass, we can produce energy without reducing food production. One possibility that MSU is investigating now is to plant fast growing trees on these lands and harvest biomass every 3-5 years. And of course, if we turn woody materials into fuels, we avoid the food vs. fuels debate entirely (no food currently being produced in the state’s forests).

Is it growing? How much?

Pennington: Ethanol production has grown tremendously over the past 6 years. Production increased from 2.8 billion gallons in 2003 to 9.0 billion gallons in 2008. During that same period, biodiesel production increased from 20 million gallons to 700 million gallons. While I don’t have any good statistics, demand for biomass for home heating and cofiring has also increased.

Pueppke: Yes, it is growing and expected to grow into the future. One example is the cellulose biorefinery that will be constructed by Mascoma in Eastern Chippewa County. This facility is projected to use significant amounts both of forest biomass and of dedicated biomass crops like switchgrass. Interest in anaerobic digesters is also growing.

Where do you see agri-energy going in the future? Will it get bigger?

Pennington: Almost all of the ethanol currently being produced in the U.S. is derived from corn. While the contribution of corn ethanol to the renewable fuels industry will show modest increases, the biggest potential for growth is cellulosic ethanol and advanced biofuels. While the technology isn’t quite there yet to produce cellulosic ethanol commercially, the potential is enormous. The Energy Independence and Security Act of 2007 indicates that by year 2022, America will be producing 15 billion gallons of ethanol from corn and another 21 billion gallons from cellulose and advanced biofuels. Advanced biofuels include hydrogen, compressed natural gas, Butanol and a number of other fuels currently being researched.

Pueppke: I believe that the state’s renewable fuels industry will grow in the future. The Obama administration is tremendously interested in developing a renewable fuels industry, and it is also committed to reducing carbon emissions. Significant resources are being made available for the research and development necessary to remove some of the impediments and bottlenecks to renewable fuels. MSU and other universities in the state already have major research projects underway, including a $135 million dollar bioenergy research center (shared between MSU and the University of Wisconsin) that is funded by the US Department of Energy.

At the same time, the state has committed itself to developing a renewable fuels industry. Several Centers of Energy Excellence have already been created. The state’s agricultural and forestry sectors have also shown great interest in renewable fuels.

How will this benefit the state and farmers here?

Pennington: Farmers will benefit from the new markets and entrepreneurial opportunities that agri-energy presents. We have a mature agriculture industry in Michigan that is poised to adapt and meet new challenges. We have some of the most innovative and forward thinking farmers as well as a climate and natural resources that position Michigan to benefit significantly. In 2008, it has been estimated that Americans spent $700 billion on petroleum. Federal policy puts us on track to produce 25% of our transportation fuel from renewable sources. Imagine the potential of diverting 25% of $700 billion to our farmers and entrepreneurs in rural America.

Pueppke: Michigan’s agricultural and forestry sectors will benefit economically from having new markets for materials we can produce. But beyond this, there are significant jobs opportunities for transportation, logistics, and in the biorefineries themselves. We should not underestimate the opportunities for research and development, which provides jobs for Michigan’s young talent and keeps it in the state. And because we have a long history of manufacturing, there is potential that the state can become a producer of biorefinery equipment and materials that can be sold in other parts of the country.