American Energy Independence and Security Act of 2007 (EIS)

American Energy Independence and Security Act of 2007 (EIS) and the global agriculture Yong Liu Department of Agriculture Key provisions of EIS • Increasing biofuels production. Fuel producers are required to increase to at least 36 billion gallons of bio-fuel in 2022 from 4.7 billion gallons in 2007. The EIS further requires that 21 billion gallons of the 2022 total must be produced by non-cornstarch products (e.g. sugar or cellulose). The plan of Renewable Fuel Standard (Data come from U.S. Department of Agriculture) billion litres: 25 20 15 10 5 0 2008 Conventional Biofuel Advance Biofuel Cellulosic Biofuel 2011 2014 2017 2020 The purpose of EIS • Energy independence and security. Figure 1 U.S. Oil Prices and Net Oil Imports from http://zfacts.com/p/196.html • Reduce the greenhouse gas emissions Introduction to the biofuels • Ethanol: is produced by microorganisms and enzymes through fermentation of sugar sources, such as sugar, starch and cellulose. The main resource include: wheat, corn, sugar beets, sugar cane, molasses and any sugar or starch that alcoholic beverages, like potato and fruit waste. Biodiesel: is derived from recycled oils or fats processed by transesterification. The resources of oil and fats include animal fats, • extraction from plant and waste cooking oils. • Cellulosic: is usually derived from corn stover Conversion factors for biofuels • A bushel of soybean can produce 1.5 gallons biodiesel • A bushel of corn can produce 2.5 gallons ethanol • A ton of corn stover can produce 80-90 gallons ethanol Current global agricultural situation: Food Crisis? • • • • Increasing energy and fertilizer prices Expanding production of boifuels Natural disasters Global warming Current global agricultural situation Biofuels and Agriculture • Compete the arable land 14000 12000 10000 8000 6000 4000 2000 1998 1999 2000 2001 Data from the world census of agriculture, by FAO 0 2002 land area arable area irrigated area • Compete the irrigated water • Compete the feed Biofuels in U.S. Largest production country in ethanol 1.annual production over 5 million gallon (2006) Consumed over 4.2 million metric tons corn Demand for Corn for Ethanol Production in the United States (Fronic Forge, “Biofuels - An Energy, Environmental or Agricultural Policy?” 8 February 2007 ) 2.114 ethanol refineries 200,000 works in this industry, $4.5 billion for farmers The impact on agriculture 1. Push up the demand for food Data from USDA: the world agriculture supply and demand estimates. The impact on agriculture 2. Create opportunities for rural agriculture 2.1 Increase job opportunities E.g. An ethanol industry with 100million gallons/year production capacity can create 2,250 job opportunities. 2.2 Increase farmer’s net income E.g. each increasing 1 percent of biodiesel use in diesel fuel would increase over 800 million dollars for the farmer’s income. 3. Slower the global warming Using ethanol can reduce 40% GHG emissions than gasoline 4. Compete water resource with food crops. The impact for different countries 1. For the American agriculture 2. For the Canadian agriculture 3. For the China agriculture Summary Conclusion: • The impact on agriculture in short-term is significant. In longterm, it is hard to define. • Different county has different impact. Future work: • Pay more attention on agriculture. (Improve average productivity) • Expand using nonfood and byproduct as the feedstock of biofuels. The End (Biofuels: Challenges or Opportunities?) Thanks!