renewable energy opportunities for american and german farmers

Trans-Atlantic Comparison:Renewable Energy Opportunities

for American and German Farmers

Neil VeilleuxMeister Consultants Group (MCG)

Beyond Biofuels: Renewable EnergyOpportunities for US Farmers

Heinrich Böll Foundation North America1638 R Street, NW, Suite 120 Washington, DC 20009, USA

Available at: http://boell.org/web/139-641.html

How German Farmers Harvest the Fields, theWind & the Sun…

Photo Source: www.germanyandafrica.diplo.de

Share of renewable energy sources in total final energyconsumption in Germany 2008/2009

3.3 3.3

6.6 6.5

4.5 5.2

6.8 7.75.5

0.71.1

0.30.4

0.4

0.3

5.9

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

2008 (15.2 %) 2009 (16.1 %) 2008 (7.4 %) 2009 (8.4 %) 2008 (5.9 %) 2009 (5.5 %)

Electricity * Heat ** Biogenic fuels

Sha

re in

[%]

Hydropower Wind energyBiomass PhotovoltaicsSolar thermal energy Geothermal energyBiogenic fuels

* Biomass: solid, liquid, gaseous biomass, biogenic share of waste, landfill and sewage gas; ** Biomass: solid, liquid; gaseous biomass, biogenic share of waste;Deviations in the totals are due to rounding;

Source: BMU-KI III 1 according to Working Group on Renewable Energies-Statistics (AGEE-Stat); Image: BMU / Dieter Böhme; all figures provisional

Current state of renewable energy in Germany

Development of electricity generation from renewableenergy sources in Germany 1990 - 2009

0

20,000

40,000

60,000

80,000

100,000

120,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Elec

tric

ity g

ener

atio

n [G

Wh]

Hydropower Wind energy

Biomass * Photovoltaics

EEG:April 2000

EEG:August 2004

StrEG:January 1991 - March 2000

EEG:January 2009

Amendment to BauGB:November 1997

* Solid, liquid, gaseous biomass, biogenic share of waste, landfill and sewage gas; Electricity from geothermal energy is not presented due to the negligible quantities of electricity produced; StrEG: Act on the Sale of Electricity to the Grid; BauGB: Construction Code; EEG: Renewable

Energy Sources Act; Source: BMU-KI III 1 according to Working Group on Renewable Energies-Statistics (AGEE-Stat); Image: BMU / Christoph Edelhoff; all figures provisional

Development of renewable electricity in Germany

Feed-in tariff (FIT) rates (biogas example)

capacity<20,000 kW0.0300.030Premium if unit employs cogeneration

capacity<500 kW0.0200.020Premium if primary feedstock is "waste fromcleaning natural open spaces"

capacity<150 kW0.0400.040Premium if biogas unit uses 30% liquidmanure feedstock

capacity<500 kW0.0690.070Premium if technology is agricultural biogas

capacity<150 kW0.1160.117Base Feed-in tariff (FIT)

Notes€/kwhTechnology or Feedstock20102009

• Guaranteed long-term contracts and interconnection for electricity generators

• Rate based on cost of generation plus reasonable profit

• Decreasing payment levels over time

German farms and wind & solar PV

• German farmers install 200-250MW of PV each year

• Influence of “Maschinenringen”(German farm machinerycooperatives)

• More than 20,000 wind turbines(2009)

• Community-owned wind farms(45% of market by 2005)

German farms and biogas

50 65

182256

333390

650

1,100

1,2711,377

1,597

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Year

Inst

alle

d C

apac

ity (M

W)

Source: German Biogas Association 2010

German farms and biogas

• 5,000 installations by 2010

• Small (<190 kW) and largefacilities

• Power 3.8 millionhouseholds

• Germany is leading the EUin biogas production

Driver #1: Comprehensive national climatestrategy and energy policy

Targets for 2020:• 40% less GHG emissions (270 Mio. tons)• 30% share of renewable energy in electricity• 14% share of renewable energy in heating• (EU energy package: 20-20-20 by 2020)

Policies:• carbon taxes in 1999• feed-in tariffs in 2000• cap & trade in 2005 etc.

Driver #2: Pro-active German Farm Federationand renewable energy industry

• Deutscher Bauernverband (DBV) is lobbying forambitious renewable energy policies

• DBV has recognized climate change as a threat toindustry and society

• Renewable energy industry is well-organized andcollaborative (e.g. German Biogas Association in 1992)

Driver #3: Social catalysts in Germany

• Machinery cooperatives (>250) work as ruralcooperatives and advise farmers, aggregate orders, andorganize installations & maintenance.

• Banks: solid calculation by farmers, safe (=good)business for the banks.

Driver #4: Rural communities striving for 100%renewable energy

• Regional economic development: farmers, planners,craftsmen

• 100% energy independence for town power and heat(Jühnde –biogas for CHP, additional wood chips inwinter)

• www.100-ee-kongress.de by Federation of GermanMunicipalities (DStGB)

US Farmers and Renewable Energy…

Photo Source: www.bettergeneration.com

Source: U.S. EIA.

The role of renewable energy in the nation’senergy supply, 2008

US farms and wind & solar PV

• In 2009, farmers & local landowners owned 638 MW(1.8%) of total installed wind capacity.

• Farmers more likely to lease land to wind farms thanown turbines themselves: lost revenue opportunity.

• Unstable policy: PTCboom-bust cycles.

• No estimates of PV onfarms, but ~200 MW wereinstalled in the U.S. in2007.

US farms and biomass

• Biomass makes up 4% of total US energyconsumption (2008)– At 6%, bioenergy could generate $20 billion in new

income for farmers…

• Biomass share of net renewable electricitygeneration: 13.1%;

• Little data on bioheat, but thermal uses of forestbiomass could reduce GHG emissions earlier thanuse through electricity generation.

US farms and biogas• Despite environmental and economic advantages, US farms lack

the policy support to build vibrant biogas market…

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Faci

litie

s

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

MW

cap

acity

U.S. - #FacilitiesGermany #facilitiesU.S. - MW

Germany MW

US farmers & renewable energy:policy recommendations

• US farmers and their representatives should advocatefor state renewable energy policies (specifically FITs orlong-term contracts for renewable energy)

• US agriculture lobbies should support a comprehensivenational climate and energy strategy.

• Rural communities should develop strong stakeholdernetworks.

• The US should use a diversity of feedstock/technologiesfor on-farm renewable energy generation.

Additional suggestions for research and actionin the US

• Raise awareness of farmers and rural communities with anoutreach campaign.

• Increase farmer-to-farmer exchanges.

• Develop a biogas roadmap for the US.

• Create sustainability criteria for biomass in power, heat, andtransport.

• Support research on policy options.

• Evaluate the benefits of renewable energy, distributedgeneration and energy independence with quantitative analysis.

Thank you…

Neil VeilleuxMeister Consultants Group (MCG)

Neil.Veilleux@mc-group.com