Air Bio Transportation Agreement

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					      BIOECONOMY & TRANSPORTATION ADVISORY GROUP

                                                     GHG Reductions*       Net
                                                       (MMtCO2e)        Present      Cost-
                                                                         Value     Effective- Level of
               Policy Option
                                                                 Total   2008–       ness     Support
                                                     2015   2025 2008–    2025     ($/tCO2e)
                                                                  2025 (Million $)
BT-1   Low Carbon Fuels Strategies
1.1    Market Pull and Distribution Infrastructure                                            Pending

1.2    Low Carbon Fuels Policy                                                                Pending

1.3    Vehicular Fuel Efficiency                                                              Pending

BT-2   Transportation Issues
       Vehicle Miles/Demand Management
2.1                                                                                           Pending
       Pricing/pay-as-you-drive

2.2    Expand Travel Choices                                                                  Pending

2.3    Transportation Demand and Land use

2.2    Freight Transportation                                                                 Pending

BT-3   Research and Technology
       Advanced Conversion Technology
3.1                                                                                           Pending
       Commercialization
       Technical Assistance to Advanced
3.2                                                                                           Pending
       Technology Projects
       Increase Regional Research
3.3                                                                                           Pending
       Collaboration
BT-4   Biobased Products
4.1    Biobased Product Development                                                           Pending
       Regional Infrastructure for Biobased
4.2                                                                                           Pending
       Product Manufacturing
BT-5   Biomass
5.1    Perennial Biomass Supply                                                               Pending

5.2    Biomass Feedstock Supply Logistics                                                     Pending

BT-6   Wealth Creation and Jobs
6.1    Bioeconomic Wealth Creation                                                            Pending

6.2    Bioeconomic Workforce Development                                                      Pending
       Cross-cutting Issues
BT-7   Bioenergy Incentives
  BT-8    Next-Generation Regulation


GHG = greenhouse gas; MMt = million metric tons; t = metric ton; CO2e = carbon dioxide equivalent; VMT =
vehicle miles traveled; UC = unanimous consent; TBD = to be determined




Volunteers for Focused Discussion on Policy Clusters

                                                   Lead
                                                                         Volunteers for Policy
                  Policy Option                   Facilita-
                                                                            Option Focus
                                                    tor

          Market Pull and Distribution            Brendan
BT-1.1
          Infrastructure                           Jordan
                                                            Bob Craig, Mary Blanchard, Charles Griffith,
                                                   David     Mike Doherty, Jack Huggins, Joe Shacter,
BT-1.2    Regional Low Carbon Fuels Policy
                                                   Shelton Doug Berven, Greg Kissek, Error! Reference
                                                                 source not found.Justin Stegall
                                                  Amanda
BT-1.3    Vehicular Fuel Efficiency
                                                    Bilek


                                                   David      Lynn Wilson, Lynne Bly, Joe Shacter, Eric
BT-2.1    Vehicle Miles/Demand Management
                                                  Shelton             Sundquist, Jeff Peloske

 BT 2.2   Expand Travel Choices

 BT 2.3   Transportation Demand and Land use

BT-2.2    Freight Transportation



          Conversion Technology
BT-3.1
          Commercialization
                                                                Mary Blanchard, Dennis Banasiak, John
                                                    Jason
BT-3.2     Advanced Tech Support                              Biondi, Hans Blaschek, Kevin Kephart, Tom
                                                    Miles
                                                                                Thies

BT-3.3    Regional Research Collaboration



                                                    Jason
BT-4.1    Biobased Product Development                        Hans Blaschek, Tom Thies, Michael Bailey
                                                    Miles
          Infrastructure for Biobased Product
BT-4.2
          Manufacturing



                                                    Gloria     Charles Griffith, Bill Johnson, Steve Flick,
BT-5.1    Perennial Biomass Supply
                                                    Flora            Lynn Wilson, Michael Bailey

BT-5.2    Biomass Feedstock Supply Logistics
                                                       John Biondi, Jack Huggins, Larry Leistritz,
                                              Gloria
BT-6.1   Bio-economic Wealth Creation                   Greg Krissek, Eric Sundquist, Lynne Bly,
                                              Flora
                                                                    Mary Blanchard
BT-6.2   Bio-economic Workforce Development



BT-7     Bioenergy Incentives                              Part of all other options
 BT-8    Next Generation Regulation                Being handled by another Tier IV Group




OBJECTIVES (from the Platform Document)

• Develop the Midwest‘s capacity for production of biofuels and other low-carbon
advanced transportation fuels to advance national energy independence, add value for
consumers, revitalize rural economies and the region‘s manufacturing base, and decrease
greenhouse gas emissions.

• Accelerate strategies for improving the efficiency of biofuels production and use,
reduce fossil fuel inputs, minimize GHG emissions, decrease water use and strengthen
the existing biofuels industry.

• Develop, demonstrate and commercialize a variety of biomass-utilizing technologies
and other low-carbon advanced fuels covering a portfolio of energy products and
biobased products.

        (The ―demand reduction‖ group should take a crack at 1-2 new objectives that
         capture non-fuel aspects of the transportation challenge)
          BT-1.1: Market Pull and Distribution Infrastructure


Policy Description
According to the 2007 Midwestern Governors Association Energy Security and Climate
Stewardship Platform, states should:

―Provide market pull and the distribution infrastructure for biofuels and advanced
transportation fuels by:
       • Promoting broad renewable fuels standards that include specific carve-outs for
       lower-carbon advanced biofuels;
       • Creating incentives for increased public demand for fuel-efficient, lower carbon
       vehicles;
       • Expanding state government‘s use of biofuels and advanced transportation fuels;
       • Developing regional quality standards for biodiesel and other fuels; and
       • Adopting retail tax incentives encouraging retailers to sell biofuels, advanced
       transportation fuels, and bio-based products.‖




   1.
   2.




Policy Design

The following criteria is recommended for developing policy to accomplish platform
goals:
   3. In keeping with the Low Carbon Fuel Policy described in section 1.2, any
       incentives should be technology and fuel neutral and based on the life cycle
       greenhouse gas emissions of the low carbon fuel in question.
   4. Any new incentives should seek to level the playing field for lower carbon fuels
       without an undue impact on consumers. We therefore recommend that states
       consider counter cyclical retail subsidies or taxes. In the case of a tax, it would be
       designed to add higher taxes to gasoline and diesel when gasoline or diesel prices
       are low to create a price floor and to be reduced with gasoline or diesel prices are
       high to offer relief to consumers. In the case of an incentive or subsidy, it would
       be designed to lower the price of lower carbon fuels when gasoline prices are low,
       with the same intent.
We recommend creating a ―Green Fuel Retailers‖ program that relies on a variety of
mechanisms to improve the distribution of low carbon fuels throughout the region.
Establish a ―Green Fuel Retailers‖ program that rewards retail and wholesale outlets that
attain benchmarks in the sale of low carbon fuels. Such a step provides recognition for
achievement and important cost-savings to both the seller and consumer of biofuels.
Access to low carbon fuels should address any fuel considered as a low carbon fuel under
the Midwestern Low Carbon Fuel Policy described in 1.2. Any retail outlet that sells a
minimum level of low carbon fuels would receive a Green Retailer designation.



Goals: See list of overarching goals prior to this section. Refine and develop more.
Ideas for crafting goals:

   1. Name of strategy or mechanism
   Describe what needs to be done

   2. What needs to be accomplished quantitatively?

   3. Identify a time frame in which to accomplish the goal – provide interim
      milestones as appropriate.

   4. Funding [Add this if appropriate.]

   Describe new and existing dollars from regional, state/provincial, and federal
   sources …

Timing:

Parties Involved:

Other:


Implementation Mechanisms
Create a Green Fuel Retailers program (tax incentives for E85 and biodiesel sales):

     A Green Fuel Retailer will receive incentives to support the infrastructure
     development needed for low carbon fuels and to help ensure the retailer is able to
     provide value-based pricing (based on the energy content of the fuel) for
     sustainable consumer use. The applicable incentive will be a reduction in the
     payment of motor fuel tax on all gasoline sold at the facility. These incentives are
     needed in the early stages of E85 growth to accelerate the development of new
     production, distribution, and retail channels.
    A feebate approach could be considered where increases to the motor fuel tax (fee)
    are used to create a fund that would provide Green Fuel Retailers with an incentive
    (rebate) for sales of low carbon fuels. Such a public/private partnership is critically
    needed to accelerate consumer access to alternative fuels and support consumer
    value; setting the stage for increased use of renewable fuels in the transportation
    sector beyond low-level blends. The amount of the fee (per gallon of gas sold)
    could initially start at 0.01/gallon equivalent and could be increased as needed to
    achieve the program‘s goal.

    Other mechanisms might also be considered as part of a green retailers program
    including:

         o Grants: funds in the ―Green Fuel Retailers‖ program could be devoted to
           grants that allow the installation of refueling infrastructure including E85
           pumps, blender pumps, hydrogen refueling infrastructure, and electric
           vehicle recharging infrastructure.

         o Public Education: Public education could be an aspect of this program.
           Elements of the public education effort could involve mapping low carbon
           fuel refueling stations throughout the Midwest, providing resources for
           refueling of government vehicles and university fleet vehicles, and
           providing clear definitions of what constitutes low carbon fuels and
           vehicles. A public sponsored branding effort might be used to develop a
           ―Green Fuel‖ logo that could be used by qualifying retailers and vehicles.

         o Research: Some funding in the Green Fuel Retailers program might be
           devoted to research that plays a crucial role in bringing fuels to market. An
           example of past research that fits this criteria is a recent study exploring
           the optimal blend of ethanol for fuel economy in different vehicles, and
           studies exploring the impact of higher blends of ethanol on engines.

         o Certification: State governments should encourage Underwriters
           Laboratory to develop standards for low carbon fuel refueling
           infrastructure (such as the recent standards released for biodiesel blends).

         o Provide incentive payments based on quantity of fuel sold



Related Policies/Programs in Place
     o Review Illinois Biodiesel tax structure, successful biodiesel incentive program
       for blends above B10, consumers are given a tax break
     o Review Iowa‘s bioenergy incentives (which can apply to biogas, hydrogen,
       etc)
     o Michigan Green Retailers Program-proposed program to provide limited
       number of grants to convert existing pump infrastructure from gasoline to
       biofuels
Type(s) of GHG Reductions
[List the GHGs being reduced e.g., Primarily CO2. ]

Estimated GHG Reductions and Net Costs or Cost Savings

GHG Impacts
Describe what this policy option will do/how it contribute to fulfilling the goal.[List any
assumptions using numbers such as: The BTAG WORKING GROUP assumes that

    1. XXX [option]-1 produces what

    2. Add more information

Provide any relevant statistics, for example on projected growth.

Costs/Cost Saving
Add paragraph or more. Use footnotes to show sources

       [If you use Tables Give them a Number and Title; use Arial font.]

Data Sources:
Give complete information and include URL links if available.

Quantification Methods:
Briefly describe in a paragraph/several sentences. Okay to refer to information supplied
above.

Key Uncertainties
Briefly describe using separate paragraphs for different topics.

Additional Benefits and Costs
    1. Use numerical listing.
    2. Keep the items brief – 1 or 2 sentences.
    3. Include social /non-quantifiable and indirect benefits
.

Feasibility Issues
Note if BTAG WORKING GROUP members raise feasibility questions:

   Use bullet points.
       Give each a sentence.
    Add any other info relevant to the feasibility questions.
    Status of Group Approval
    Pending

    Level of Group Support
    TBD



    Parking lot:



    Executive Order:
        Not require state, government, or university employees to fill up the vehicles
           where the organization has an E85 pump (state employees typically required to
           fill up prior to returning a state fleet vehicle).

    Mandates
   Local governments purchase flex fuel vehicles.
   State universities purchase flex fuel vehicles.
               o Achieved through state revenue sharing with local governments – mandate
                    local government fleets
               o Pool counties, state, local governments, and universities purchasing flex
                    fuel vehicles across the region,

    Carve-Outs (this area needs to be fleshed out for clarity)
        Corn-ethanol from what type of plant
        Cellulosic – ethanol
        Sugars – Virent – no UL issues
        Lower-Carbon Advanced Biofuel – must be 10% less than current fossil fuel in
          the life cycle –
        Carve out would require much more ethanol – possibly triple this amount –

    Incentives

    Look into company called – Imergent – small scale production of biodiesel – fits into a
    railcar – can produce it – must have feedstock – could be utilized in farming communities
    – looking at smaller economies of scale -
                o Looking at farmers who want to produce ethanol on their own property
                       BT-1.2: Low Carbon Fuels Policy


See attached Midwestern Low Carbon Fuel Policy draft recommendations.
                      BT-1.3: Increase Vehicle Fuel Efficiency



Policy Description
The Midwestern Governors Association Energy Security and Climate Stewardship
Platform recommends that states:

―Develop incentives for increasing vehicle fuel efficiency and reducing greenhouse gas
emissions.‖

The policy is designed to reduce GHG emissions from on-road vehicles and off-road
engine vehicles (including marine, rail and other off-road engine and vehicles such as
construction equipment) through technology deployment designed to cut GHG emission
rates per unit of travel activity.

The overall goal of this policy is to be one of the three legs of the three-legged stool of
transportation emissions, namely vehicle efficiency (this policy), GHG intensity of
fuels(1.2), and vehicle miles traveled (2.1 and 2.2)

In developing regional policies, we seek to supplement CAFÉ regulations but further
reduce costs to consumers.




Policy Design
Incentives for on-road vehicles:
In designing any incentives for low carbon or energy efficient vehicles, a regional body
should develop criteria for what constitutes a low carbon or energy efficient vehicle. We
recommend that vehicles should qualify for incentives based on a performance-based
quantitative criteria, either meeting a GHG-per-mile criteria or an mpg criteria. In
general, the types of vehicles likely to be included under a ―low carbon vehicles‖
program would include: flex fuel vehicles, hydrogen fuel cell vehicles,

   Goals:
   Reduce emissions from on-road engines/vehicles by at least an additional 15% by
    2020 from current adopted baseline policies through more efficient technologies and
    operations. Reduce emissions from off-road transportation sources through use of
    more efficient technologies and operations by xx% by 20xx.
   Reduce transportation GHG emissions through education to promote intelligent
    transportation purchasing choices and vehicle operation;
Timing:


Parties Involved:

Other: None cited.

Implementation Mechanisms
Policy mechanisms for reducing GHG emissions from on-road vehicles and off-road
vehicles:

       
         Begin consumer information program in 2010, with program expansion, as
          resources are made available
       Ensure a training be delivered for all state and municipal fleet operators for
          States and appropriate agencies by 20xx
       Provide Tax incentives for higher efficiencies;
Develop HOV lane access for low carbon vehicles;
      Provide incentives for retooling manufacturing facilities to advanced vehicle
      technology;
       Adopt California Clean Car standards in all MGA states;

       Establish an innovative gas tax approach such as a ―floating tax‖ based on fuel
       price;
        Require fleet replacement to use low carbon vehicles;

          Provide incentives to increase purchases of fuel-efficient or low carbon
           vehicles;
          Initiate marketing and education campaigns to operators of off-road vehicles;
        Adopt state contracting and fleet standards for low GHG equipment
         procurements;
       ○ Implement Clean Car Programs and new policies to spur development and use
         of Plug-in Hybrids;
        Model a region wide Eco-Driver program after the proposed Michigan Eco-
         Driver program to be implemented in all MGA states;
        Design a policy neutral feebate structure where owners of vehicles below a
         certain threshold of fuel efficiency would pay a fee, and those above a certain
         fuel efficiency would receive a rebate;
        Design consumer education campaign for tire inflation; and
          Establish incentives or requirements for low resistance tires.
Policies for off-road engine vehicles
      Adopt ―Green Port Strategy‖ for port facilities.
Related Policies/Programs in Place
There are a few precedents for evaluating vehicles based on GHG emissions that could be
evaluated:
    Can we use CA-like mpg-equivalent terms/or per btu?

      Look at CA LCFS recommendations and see what they recommend in this area.

The MI Eco-driver program recommends implementing four program initiatives to
achieve a fuel-economy increase (and corresponding GHG reduction) of at least 10% in
the mid-term with a long term benefit potential of up to 20%.

California Clean Car Standards-Using its authority under the Clean Air Act, California
set tougher motor vehicle standards for global warming emissions and other motor
vehicle tailpipe emissions. The standards require carmakers to reduce global warming
emissions from new passenger cars and light trucks beginning in 2009. Carmakers have
eight years to comply with the new standards, which will cut emissions of global
warming pollutants by approximately 30 percent once they are fully phased in by 2016.
Thirteen other states and the District of Columbia have adopted these motor vehicle
standards and several other states are considering adopting the California Standards,
Minnesota and Illinois are the only MGA states currently considering adopting the
standards. Canada has signed an agreement with automakers to deliver global emission
reductions comparable to those required by California.

Type(s) of GHG Reductions
For example: Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
List, if possible provide URL..

Quantification Methods:
Briefly describe in a paragraph/several sentences. Okay to refer to information supplied
above.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
   1. Use numerical listing.
    2. Keep the items brief – 1 or 2 sentences.
    3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD

Parking Lot:

   Reduce idling time in locomotive and construction equipment;
Note the following are not necessarily incentives but can help achieve the stated
objective:




Driver Education
Education is the first step to successful implementation. Drivers will voluntarily reduce
fuel use and GHG emissions from their activities when they have the information
necessary to make proper decisions.
                       BT-2.1 Vehicle Miles/Demand Management
                            Pricing/pay-as-you-drive


[The policy material that appears below is drawn very heavily from Appendix H to the
Minnesota Climate Change Advisory Group‘s Final Report, 2008 – that description has
been minimally edited for an MGA audience, and updated regarding recent, related
initiatives.]
Policy Description
This policy recommends that the Midwestern Governors support their states‘ institution
of requirements and policies ensuring that drivers more fully pay the total costs of
driving. This policy would encourage drivers to choose transportation alternatives,
purchase more efficient vehicles, drive less, and/or drive more efficiently (combining
trips). This option generally reduces VMT and GHG emissions.


Policy Design
The University of Minnesota‘s Full Costs of Transportation in the Twin Cities Region
report concluded in 2000 that the total cost of a mile of automobile travel in the region
was between $0.84 and $1.62, with a mid-range estimate of $1.14. Drivers do not see all
of those costs, for three general reasons:

   1. A substantial portion of the costs is not variable, meaning that driving less does
      not save the person money. A good example of this is insurance, paid every 3 or 6
      months. One goal of this policy is to increase the proportion of that cost that
      drivers and society can save by driving less.
   2. A substantial portion is paid for by revenue streams that are not necessarily
      directly related to automobile use. For example, property taxes pay for a large
      portion of the costs of local roads. That nexus may be appropriate for various
      reasons, but one result is that the cost of vehicle mobility (of all kinds) is not
      borne by those vehicles.
   3. Driving (of all kinds) produces substantial externalities, both positive and
      negative. Drivers do not see all of them. The impacts of the emitted CO2 are the
      externality most central to this climate change policy process.

As a result, this set of policies recommends that MGA states take action in four areas:

   1. Implement systems to encourage the purchase and operation of low-GHG-
      emitting passenger vehicles.
   2. Provide incentives for auto insurance companies to institute a ―pay-as-you-drive‖
      (PAYD) system for policyholders.
   3. Implement policies and strategies that make more of the fixed costs of driving
      into variable costs related to VMT and emissions. Possibilities include CO2-based
      registration fees, a VMT tax, congestion pricing, and a fuel tax.
   4.    Use new revenue streams for less GHG-intensive travel options (e.g., public
         transit, vanpooling, commuter benefits, and commuter options).

   In all cases, the states should design and implement policies with an explicit
   consideration of equity impacts on both low-income and rural drivers.

Goals:
Goals from MGA Platform that may be relevant to this policy area:
Develop incentives for increasing vehicle fuel efficiency and reducing greenhouse gas
emissions

The MCCAG policy recommendation suggests for PAYD insurance–assume market
penetration of 25% in 2015 and 50% in 2025

Timing:
Adoption without delay. At the latest, MGA policy recommendations 2009; followed by
inclusion in legislative proposals 2010.

Parties Involved:

Highway and transit users; automobile manufacturers and retailers; insurance
companies, state Departments of Transportation, Commerce, Public Safety, Revenue,
Finance, Pollution Control/Natural Resources; metropolitan planning organizations.

Other:

Increasing the price of driving reduces the number of miles driven and can be
accomplished in a variety of ways. Since the early 1900s, state and federal gas taxes have
been a ―pay as you drive‖ tool to fund transportation. So, among the possible strategies is
increasing the gas tax, which is likely to both reduce the number of miles driven and
provide additional transportation revenue to the states. Tolling is another pricing strategy
that has been applied in many areas.

In the MCCAG process, the Transportation Working Group discussed various issues
raised by a gas tax increase, including the economic and personal impact of higher taxes
and the constitutional issues that exist around the use of gas tax revenues. In light of these
issues and concerns expressed by the current administration, the TWG is making no
recommendation on the gas tax to the MCCAG. However, the group urged the MCCAG
should seriously consider financial strategies that would make the full (including
environmental) cost of driving more apparent to drivers.

Significant policy innovation and development are occurring in this area. In the future,
additional options may exist that would accomplish the goals of reducing VMT and
providing additional revenues to support lower GHG transportation options, including
transit.
Examples of this approach that have been implemented in recent years include variable
congestion pricing (LA, Minneapolis) and cordon-based pricing (London). Since 2005, a
largely-automated mileage-based toll has been applied on Germany‘s autobahn on heavy
commercial vehicles; the toll is graduated to reflect magnitude of GHG emissions. In its
first years of operation, the system is credited with a 15% reduction in high-emission
vehicles, a 20% reduction in ―deadheading‖ trips, and a 7% shift to rail.
Notes from 12.4.08-full BTAG call
             – Impact on rural groups who have no other choice than to drive long
                distances, there are some reservations
                    • Separate into commercial and non-commercial may solve this
                        problem
                    • Also looking at per-GHG fees rather than per-VMT fees so that
                        users can get around the fee


Implementation Mechanisms
Increase the Consumer Cost of Driving
Increasing the cost of automobile use can reduce fuel consumption and travel while
encouraging the use of alternative fuels and public transit.

Higher vehicle registration fees could be charged for vehicles that have lower fuel
economy and higher GHG emissions. Vehicle licensing fees could be based upon vehicle
weight and/or emissions, for example, with use of a dollar per vehicle-ton multiplier
instead of the present broad categories of vehicle weight.

Sen. Barbara Boxer has suggested that a simplified system that relies principally on self-
reported annual miles driven may be practical.

Encourage the Purchase of Low-GHG Vehicles
The states could adopt a variety of programs to increase purchase of fuel-efficient or low-
GHG vehicles (including pure electric, hybrid, plug-in hybrid, and other alternative-fuel
vehicles). State incentives could include lower registration fees, feebates, and/or tax
credits.

Support PAYD Automobile Insurance
The states would encourage and support the provision of PAYD auto insurance, possibly
including state support for additional pilot programs. This would also require the states‘
insurance commissions to conduct an active review of possibilities.

Notes from 12.4.08-full BTAG call
Implementation liklihood
          – Barriers to adoption are different in various states
          – This is a direction the market is going
          – Rural social justice issues are a barrier – need to have a transition to ease
              the transition to more efficient vehicles.
   • Other questions:
           –   Will rural groups (such at northern Manitobans) be penalized when they
               have no other travel options?
                  • A per-VMT fee may have that impact (maybe per-GHG fees would
                      be better)


Related Policies/Programs in Place
MnDOT pilot underway to test VMT fees (no results are yet available), and PAYD
insurance.

GMAC and OnStar Low-Mileage Discount Rates
Since mid-2004, the General Motors Acceptance Corporation Insurance has offered
mileagebased discounts to OnStar subscribers located in certain states. The system
automatically reports vehicle odometer readings at the beginning and end of the policy
term to verify vehicle mileage. Motorist who drive less than the specified annual mileage
receive insurance premium discounts of up to 40%:

       1–2,500 miles: 40% discount
       2,501–5,000 miles: 33% discount
       5,001–7,500 miles: 28% discount
       7,501–10,000 miles: 20% discount
       10,001–12,500 miles: 11% discount
       12,501–15,000 miles: 5% discount
       15,001–99,999 miles: 0% discount

The Federal Highway Administration‘s Value Pricing Pilot Program is now providing
funding for PAYD insurance simulation projects in Georgia and Massachusetts.

Distance-Based Program
Progressive Insurance offers distance-based insurance in Oregon, Michigan, and
Minnesota.
The program uses Global Positioning System technology to track vehicle location and
use.

Farmers Insurance is reported to also be considering a similar program.

TripSense(SM)
In August 2004, the Progressive Direct Group of Insurance Companies introduced
TripSense, a
usage-based auto insurance discount. The group notes:

       ―Safer drivers and people who drive less than average should pay less for auto insurance. That‘s
       why we created the revolutionary TripSense(SM) discount program, which measures your actual
       driving habits and allows you to earn discounts on your insurance by showing us how much, how
       fast and what times of day you drive. TripSense gives you more control over what you pay for
       insurance, as your driving habits determine your discount.‖
Type(s) of GHG Reductions
Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
The Arizona Public Research Interest Group (PIRG) Education Fund analyzed the
potential GHG savings from a PAYD automobile insurance policy. The strategy for a
PAYD policy analyzed assumes that insurers are required to offer mileage-based
insurance for certain elements of vehicle insurance, including collision and liability. The
Arizona PIRG Education Fund assumes the PAYD policy is required and phased in over
time, and that all drivers in Arizona are eventually covered.

To calculate GHG savings, the Arizona PIRG Education Fund converted Arizona state
automobile collision and liability insurance expenditures to an insurance cost per mile
($.064/mile). If insurance consumers pay 80% of their collision and liability insurance on
a per mile basis, then drivers would be assessed about a $.051/per mile. This per-mile
insurance charge would reduce VMT by about 8%.24 (To put this charge in context, at 20
mpg, $.051/mile = ~$1/gallon of gasoline.)

The MCCAG review compared the Arizona PIRG Education Fund results for estimated
reductions in VMT with other studies of PAYD policies, including those produced by the
Economic Policy Institute and Resources for the Future. The MCCAG effort found that
the Arizona PIRG estimates were comparable with other estimates, which ranged from
8% to 20%, and used the 8% estimate for its analysis.

Quantification Methods:
Impacts
Pilot studies and empirical experience with other marginal costs of use find that PAYD
can reduce VMT by between 8% and 20%. If phase in/ramp up, then:
        Apply reductions to light-duty vehicle (LDV) VMT only:
        • 2015 reduction = statewide LDV × 4% reduction.
        • 2015–2025 reduction = statewide LDV × 8% reduction.
        • Convert to CO2.

Net Present Value/Cost-Effectiveness
The success of the Progressive Insurance pilot in Texas suggests that there is an unmet
demand for more choice in auto insurance. If PAYD improves and increases consumer
choice, and also allows insurance providers to more efficiently align risks and premiums,
economic efficiency will increase.

The University of Minnesota‘s Center for Transportation Studies report Reducing
Greenhouse Gas Emissions from Transportation Sources in MN included pay-as-you-
drive (PAYD) insurance among its travel reduction strategies. The report found a
potential for a 1 percent reduction in vehicle miles driven based on the following
assumptions:
               The number of vehicles statewide was estimated using the LEAP model for the year
                2025. The Mn/DOT growth factor of 0.9% was applied to the 2004 VMT and A-8
                projected for the year 2025. These values were used as inputs for the CCAP Emissions
                Calculator.
               A 10% penetration rate was used

Key Assumptions: List/describe

For the MCCAG evaluation, the analysis assumed that State regulation automobile
insurance industry requires insurance companies to offer PAYD insurance, and eventual
application of PAYD insurance to 50% of the LDV fleet.

Key Uncertainties
The specifics of the PAYD insurance programs are to be determined.

Until there is broader implementation beyond the current pilot programs, the effects of
PAYD insurance on driver behavior are subject to significant uncertainty.

Until there is broader implementation beyond the current pilot programs, the economic
impacts on insurance companies are unclear. A common question is, ―If distance-based
pricing is better, why do insurance companies not offer it without a mandate?‖

In general, as has been demonstrated repeatedly in other consumer sectors, individual
firms may innovate and not be followed by other firms for a wide variety of reasons, but
when the market is transformed through policy changes, the industry adapts and remains
healthy. Specifically regarding vehicle insurance, the Victoria Transport Policy Institute
has noted:
       ―Individual insurers face several barriers to implementing distance-based pricing. An individual
       company faces relatively high administration costs to establish an odometer auditing system.
       Insurance regulators are often unsupportive of pricing innovations. An individual insurance
       company only captures a small portion of the total benefits, since most financial savings are
       passed back to customers or accrue to competitors. Insurers do not profit from reductions in
       uncompensated crash costs, congestion, infrastructure costs, or pollution, or benefit directly from
       increased equity. Insurance companies currently maximize profits by maximizing their gross
       revenue, because they are dependent on investment income. A pricing strategy that reduces total
       crashes could reduce profits if regulators or market competition required a comparable reduction
       in premiums. Although there are potential financial and marketing benefits, these longer-term
       savings would have to offset an individual insurer‘s short-term revenue losses and risks. It is
       therefore not surprising that few insurers have implemented distance-based pricing.‖



Additional Benefits and Costs
Equity Impacts
Proponents, including Todd Litman of the Victoria Transport Policy Institute argue that
PAYD improves equity and fairness:
       ―Current vehicle insurance pricing significantly overcharges motorists who drive their vehicles
       less than average each year, and undercharges those who drive more than average within each
       price class. Since lower-income motorists drive their vehicles significantly less on average than
       higher-income motorists, this is regressive. Distance-based insurance is fairer than current pricing
       because prices more accurately reflect insurance costs…Distance-based pricing benefits lower-
       income drivers who otherwise might be unable to afford vehicle insurance, and who place a high
       value on the opportunity to save money by reducing vehicle mileage. It benefits lower-income
       communities that currently have high, unaffordable insurance rates…. Distance based insurance
       would provide significant savings to workers during periods of unemployment, when they no
       longer need to commute.‖

Other equity issues may be addressed through policy design.

Feasibility Issues
None cited.

Status of Group Approval
MCCAG – approved

Level of Group Support
MCCAG–Supermajority

Barriers to Consensus
Some MCCAG members viewed pricing of any amount as essentially punitive.
                            BT-2.2: Expand travel choices



Policy Description
Expand travel choices to reduce vehicle miles driven. Four alternative modes are
described in this policy: Intercity passenger rail, mass transit, bicycling, and walking.

The write-ups below are taken mainly from a report prepared by the Center on Wisconsin
Strategy, the Environmental Law & Policy Center, and the Ecology Center of Ann Arbor,
MI. This report on potential GHG reductions from using alternative modes was written
for consideration by the new Transportation Working Group of RE-AMP, a seven-state
coalition of environmental groups working toward GHG reductions. The report was
completed in September 2008. For bicycling and pedestrian policy, this policy
description relies on a September 2008 report, ―Active Transportation in America,‖
written by the Rails-to-Trails Conservancy. Supplementing this information are data
gleaned from the websites of the Minnesota, Wisconsin, and Illinois climate change
advisory groups convened by their governors.

Passenger Rail

In the late 1990s, and continuing through 2004, nine state departments of transportation
joined forces to envision a hub-and-spoke rail network serving the Midwest, with
Chicago at its hub. The states were Illinois, Indiana, Iowa, Michigan, Minnesota,
Missouri, Nebraska, Ohio, and Wisconsin. The $7.7 billion plan (in 2002 dollars) is
called the Midwest Regional Rail Initiative (MWRRI), and is based on two critical
assumptions:

      Service upgraded to permit maximum speeds of 110 mph, in comparison to 79
       mph today
      Existing infrastructure upgraded; no new rail rights-of-way constructed

The $7.7 billion plan becomes considerably less expensive—80% less, in fact—when
considering the Rail Safety Improvement Act recently passed by Congress and signed
into law by President Bush. This Act creates, for the first time, a federal fund pool to
which states may apply for up to 80% of project costs. While the initial pool level is
relatively small—$1.5 billion—it is expected to grow under the new Administration.

Critics of the MWRRI plan correctly note that 110 mph service is nowhere near the
maximum speeds of intercity trains around the world. MWRRI, however, tries to balance
the need for improved rail transportation—in particular, beating the automobile—with
costs. Federal Railroad Administration requirements state that for speeds higher than 110
mph, such major improvements would be required in existing rights of way as to
essentially mandate the construction of all new track. This results in a price tag many
times higher than the $7.7 billion estimated for MWRRI.
Mass Transit
Chicago‘s system is the only so-called heavy rail transit line in the region, although
Minnesota is expected to open, by the end of 2009, the Northstar Commuter Rail Line
from Big Lake MN (about 40 miles northwest of the Twin Cities) to downtown
Minneapolis. The only other rail systems of any kind in RE-AMP states are:
    Minneapolis‘s new light-rail system, which has experienced ridership levels
       surpassing all forecasts. Minneapolis‘s Metropolitan Council reports that the
       Hiawatha Light Rail Transit line provided 9.1 million rides in 2006, reaching
       levels not predicted for the system until 2020. Even better, transit oriented
       development has taken place along the line, with 7,700 housing units built along it
       as of March 2007, with another 8,000+ estimated to be built there by 2010.
    Detroit‘s People Mover system, a 3-mile fixed guideway system that circulates
       among business centers and attractions in downtown Detroit. Ridership has been
       disappointing, as the system was designed to carry 15 million people annually, but
       its maximum ridership was 2.4 million in 2001. The system has been periodically
       closed for repairs during its 20-year history as well. The People Mover is not a
       commuter system, as it does not go through residential neighborhoods.
    Kenosha, Wisconsin‘s streetcar system, a 1.7-mile loop through the 80,000-
       resident city. Ridership grew 18.5% from 2006 to 2007, and the city is pursuing
       expansion plans.

Other major cities in RE-AMP states, like Milwaukee, Des Moines, and Madison have
not had rail or streetcar systems for decades (or ever); today, they only have bus systems.
But the momentum has shifted recently in several RE-AMP cities toward the addition or
expansion of mass transit, to wit:

      Minnesota: the aforementioned Northstar commuter line opening in 2009, plus a
       Minneapolis-St. Paul light-rail route that would connect to the Hiawatha line.
      Michigan: feasibility study nearing completion for a commuter rail between Ann
       Arbor and Detroit, with stops at Metro Airport and Dearborn.
      Wisconsin: pushing for the KRM project (Kenosha-Racine-Milwaukee), which
       would make downtown Milwaukee the final stop in the extension of Chicago‘s
       Metra line that currently terminates in Kenosha.
      Illinois: The Regional Transportation Authority, the umbrella body over
       Northeastern Illinois‘ transit systems, has released a capital budget calling for $10
       billion to be spent over the next five years.


Bicycle & Pedestrian Expansion

As described by the Center on Wisconsin Strategy in its section of the scoping report,
bicycle & pedestrian modes are often handled in what are called ―Complete streets‖
proposals. These policies require local government to ensure that streets are suitably
designed for pedestrian and bicycle traffic, and for transit where appropriate. It should
ensure that the street network provides good connectivity, rather than relying on a few
arterials, which often make walking trips impractical (and lengthen car trips as well).

A September 2008 report, ―Active Transportation for America,‖ written by Rails-to-
Trails Conservancy and circulated by Lynne Bly, puts forth a set of statistics on what two
levels of investment in bicycle/pedestrian infrastructure investment would mean for
greenhouse gas pollution reduction. Nationally, the report states that a ―modest‖
investment could lead to a reduction of 70 billion vehicle miles driven, while a
―substantial‖ investment would nearly triple that reduction, to 200 billion.

The report quotes the 2001 National Household Travel Survey, which found 48% of all
trips Americans take are less than three miles, while 24% are less than one mile.
Meanwhile, the report says SAFETEA-LU allocated only $453 million annually for
2005-07 for bicycle and pedestrian systems, and a total of $4.5 billion since 1992, the
first time bicycle and pedestrian infrastructure received any federal funding. Compare
the $453 million nationwide to Chicago‘s recent Dan Ryan Expressway reconstruction
project. These 11 miles of expressway cost $1 billion.

None of the key bike/ped infrastructure investments is revolutionary. Taken from this
report‘s list are the following upgrades:

        Sidewalks/walkways/crosswalks/underpasses
        Bike lanes and bike-only ―bicycle boulevards‖
        Better signs and street markings

Another potential source of information is Rutgers University‘s ―New Jersey Bicycle and
Pedestrian Resource Center,‖ but an investigation of the Center‘s website found no
papers per se on global warming pollution reduction.



Policy Design
Goals:
Goals from MGA Platform that may be relevant to this policy area:



Timing:


Parties Involved:

Other:
Implementation Mechanisms
       Identify first legs of corridors, based on gov‘s interests

       Get state DOTs together with MGA staff to discuss priorities

       Get commitment from governors to MWRRI (complementary with CREATE)

Related Policies/Programs in Place
These could include Recent Actions in XX Jurisdiction:
Use brief paragraphs.
Or one or 2 lines.
Add bullets as needed.
Type(s) of GHG Reductions
For example: Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
Passenger Rail

Table 5.13 of a study done for the nine state DOTs involved with the Midwest Regional
Rail Initiative computes total BTUs for the corridor under the build/no-build scenarios;
working with those data, we can use the emissions factors by fuel type noted above to
compute total projected CO2 emissions for Chicago-St. Louis:

Table 1. Projected Annual Carbon Dioxide Pollution from Projected Chicago-St. Louis
Trips (BTU's in Billions)
Mode                  BTUs -    CO2 Pollution        BTUs w/ 110 CO2 Pollution
                      No build (MT)                  MPH Service (MT)
Commercial airline    2,583        183,461               1,625                115,418
Amtrak                132          9,375                 321                  22,799
Commercial bus        43           3,054                 36                   2,557
Automobile            8,794        624,606               8,643                613,881
Totals                        820,497                               754,655

Thus the annual CO2 pollution savings from bringing 110 mph service between Chicago
and St. Louis is more than 65,800 metric tons. There are eight other major corridors in
MWRRI, with the number of daily round-trips and mileage of each corridor being
somewhat different. However, the Chicago-St. Louis corridor, at 285 miles and 8 daily
round-trips, is typical of the major city-pairs in the MWRRI system. While the detailed
BTU analysis shown above was not yet undertaken for these routes, a reasonable ballpark
estimate would be to take the Chicago-St. Louis savings of 65,800 metric tons and simply
multiply by the number of other corridors in the system – eight – for an annual total of
526,400 tons saved for the entire MWRRI.

Mass Transit

SAIC, a consulting firm based in McLean, VA, published in September 2007 a study
entitled, ―Public Transportation‘s Contribution to U.S. Greenhouse Gas Reduction.‖ The
study reports that in 2005, public transportation reduced carbon dioxide pollution
nationwide by 6.9 million metric tons, composed of two types of reductions:
     Mode switching from single-occupancy personal vehicles to transit (3.9).
     Gasoline savings from reduced congestion due to transit (3.0).

A June 2008 report written for the state of Oregon contains 2006 ridership statistics
compiled by the Federal Transit Administration‘s National Transit Database. Oregon then
combined those statistics with data from the Texas Transportation Institute to develop a
list of transit ridership in the top 39 ―large‖ (between one and three million in population)
and ―very large‖ (greater than three million) cities in the nation in 2006 that had transit
systems. The Midwest is barely represented, as shown below:

       2. Chicago                             494,129,737 passenger trips
       16. Minneapolis-St. Paul                73,356,649
       23. Milwaukee                           48,972,262
       27. Detroit                             37,281,540

There were four non-RE-AMP Midwestern cities in the table: Indianapolis, Columbus,
Cincinnati, and Cleveland, respectively, with 10, 15, 26, and 69 million riders
respectively. If the nationwide total for public transportation was 6.9 million metric tons
saved, we can then estimate what total CO2 pollution savings were in the four cities listed
above based on the proportion of total nationwide passenger trips they represent. The top
39 cities represented 6,773,509,553 passenger trips. The four Midwestern cities totaled
653,740,188 passenger trips, or 9.65% of the total; extrapolating that proportion to the
nationwide total carbon dioxide pollution savings of 6.9 million metric tons yields
665,948 annual metric tons of reduction.

One caveat, of course, is that this estimate does not account for different lengths of
passenger trips among the 39 cities studied, nor does it account for the reduced amount of
sprawl—and concomitant reductions in carbon dioxide pollution—that new mass transit
may induce. Another is that this does not reflect the addition of mass transit in rural
areas. But given urban vs. rural populations, a safe assumption is that the 665,948 tons
estimated above would represent the vast majority of potential reductions from transit.


Bicycling & Pedestrian

Again quoting from the Rails-to-Trails Conservancy report mentioned above, two levels
of annual investment are described: $330 million and $3 billion. These numbers are
chosen to match assumed, eventual carbon dioxide per-ton prices of $10 and $30. At this
level of spending, as mentioned above, the report suggests vehicle miles driven
reductions of 70 billion and 200 billion, respectively.

It is important to note that these reductions are based on several key, aggressive
assumptions that would require a wholesale change in how Americans choose to get from
place to place (the report‘s source for many of the current statistics is the 2001 National
Household Travel Survey conducted by the Federal Highway Administration :

      Currently, we walk or bike for 31% of our trips of one mile or less; the ―modest‖
       and ―substantial‖ scenarios mentioned above assume 40% and 70% usage of bikes
       and human power for trips less than a mile
      Today, we bike/walk for 4% of our 1-3 mile trips; the report assumes ―modest‖
       and ―substantial‖ percentages of 10% and 25%
      The report assumes greatly improved ―synergy‖ between biking/walking and
       access to public transportation; to wit:
          o the report assumes ―modest‖ and ―substantial‖ proportions of 5% and 15%
               public transit use for trips between 1-15 miles in length (compared to 2%
               today)
          o suggested improvements in bike/pedestrian access to public transit will
               increase ridership by 10% (modest) and 30% (substantial)

With these assumptions clearly stated, we can now compute potential GHG reductions
based on the report‘s VMD reductions in the modest and substantial scenarios. The
Midwest states of Illinois, Indiana, Ohio, Michigan, Minnesota, Wisconsin, Iowa, and the
Dakotas together constitute about 19% of the U.S. population, so we can extrapolate
potential GHG savings based on reductions in national VMD for the two scenarios: 13.3
billion, and 38 billion. Using 22 mpg for the average personal vehicle, and 19.6 pounds
of CO2 emitted, this translates into regionwide GHG reductions of 5.9 million and 16.2
million tons, respectively. An important caution here is that some of these reductions are
clearly due to public transit ridership increases, not necessarily ―pure‖ bicycle and
pedestrian mode growth.

To date, no Midwestern state has specifically addressed bicycle & pedestrian options in
its climate change task force report. Notably, Minnesota, Illinois, Wisconsin, and Iowa
have lumped such strategies in with other policies. In Minnesota, the expansion of
bicycle & pedestrian choice is combined with that of transit, and only the latter‘s GHG
reduction is estimated in the report.

Wisconsin Gov. Doyle‘s Climate Change Task Force included bicycle & pedestrian
expansion in its final report, but as with Illinois, combined such policies in with its
―energy efficient communities‖ agenda. This entire package of policies was calculated to
have an annual CO2 reduction of several million tons, but again includes much more than
bicycle & pedestrian actions.
An excerpt from Illinois‘ yet-to-be-published climate change advisory group report
illustrates how this state calculated potential reductions for its ―transit oriented
development‖ umbrella. Quoting directly from that report:

―According to the Northeastern Illinois Planning Commission, 521,000 people with an
average density of about 22 persons per acre could live in 40,000 acres of transit oriented
developments (TODs) in Metro Chicago by 2020. The average density in Metro Chicago
is currently about 11 persons per acre.
http://chicagoareaplanning.org/snapshot/regional_snapshot_final_web.pdf

Therefore, the TOD adds roughly 11 people per acre on top of the 11 that would be
expected. Out of the 521,000 people NIPC estimates could be in the TODs, half (11 out
of 22) or 260,000 would live in the TODs who would not under a BAU scenario.
http://www.nipc.org/planning/pdf/nipc_transit.pdf

Illinois – people per household: 2.63
http://quickfacts.census.gov/qfd/states/17000.html

According to the Denver Regional Council of Governments, TODs can reduce rates of
greenhouse gas emissions by 2.5 to 3.7 short tons per year for each household.
http://www.drcog.org/index.cfm?page=LearnaboutTOD

260,000/2.63= 98,859 households X 2.5 short tons GHGs reduce per
household/year=247,148 short tons per year
260,000/2.63= 98,859 households X 3.7 short tons GHGs reduce per
household/year=365,778 short tons per year

Although rail transit is virtually non-existent anywhere else in Illinois, it could be added
in the future, and TODs can happen around bus transit hubs. Metro Chicago comprised
roughly ¾ of the state‘s population. Assume another 15% of the population could take
advantage of TODs. Using the same assumptions for metro Chicago = 52,000 people =
49,494 to 73,155 short tons per year.

Illinois statewide totals: 296,642 - 438,993 short tons per year

Short tons are then converted to metric tons by dividing the totals by 1.102 presenting a
range for state wide total reductions in 2020 of 269,185 to 398,360 metric tons.‖
Quantification Methods and Key Assumptions:
Methods are described above, as are key assumptions.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
   1. Use numerical listing.
   2. Keep the items brief – 1 or 2 sentences.
   3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                    BT-2.3 Transportation demand and land use



Policy Description
Even if new policies manage to reduce carbon content of fuels and increase vehicle
efficiency, increasing transportation demand could negate any climate benefit and make it
impossible to reach the MGA‘s reduction goals. Cap and trade, along with secular trends,
may introduce negative pressures on demand, but at this writing it is not clear whether
transportation fuels will be under the cap, and in any case transportation demand has been
relatively inelastic in the short and medium term to changes in fuel price. Other policies
address mechanisms to rein in SOV VMT through other pricing and mode options. Here
we address a root cause of VMT growth – transportation infrastructure and related
elements of the built environment.

Over the course of a generation, per capita vehicle-miles traveled has doubled, from 15
per day to 30 (Fig. 1). Little of this growth has resulted from the shift from transit to cars,
as that occurred in the immediate post-World War II era, and transit ridership reached its
nadir about 1970. Rather, people have made more and/or longer trips to get to work,
school, shopping, and other destinations.
           Figure 1. PLACEHOLDER -- SHOWS WI FIGS; NEED REGIONAL ONES.




The deployment of mono-modal transportation infrastructure has spurred this growth, in
part through a phenomenon in transportation economics known as ―induced travel.‖ As
new and wider freeways and other highways reduced the time cost of travel, people
consumed more of it, e.g. by moving farther from work and other common destinations,
or by locating their businesses further from customers‘ or employees‘ homes, or from
suppliers‘ warehouses. Exacerbating the trend, government enacted a host of new rules
that spurred even more travel – rules that moved schools from population centers to the
distant greenfields, for example, and those that banned businesses from locating within
near customers‘ homes, and those that required more parking than the market required,
thus spreading out buildings so that the landscape became unwalkable and difficult to
serve with transit.

These practices are costly not only in terms of CO2 emissions but also in terms of
taxpayer and consumer dollars. A population and an economy dependent on long car trips
is hostage to disruption and lowered living standards from rising fuel prices. And the
massive roadway infrastructure that supports so much driving requires ever-more money
for upkeep, even as gas tax revenues gradually begin to shrink from moves toward more
efficient vehicles via CAFÉ and popular demand. In many states, roads have become a
major drain on property tax revenues. Practices that can reduce the disutility of travel, by
lowering the frequency and length of trips, will benefit the private economy and
government coffers.

Even though the costs are widely recognized, the practices described above are so
embedded in law and agency procedures that reform has been difficult. A complicating
factor for state executives is that some of the practices are under the purview of local
government. Yet we must reform these practices if we hope to meet our climate goals,
and some state governments and climate task forces have begun to show the way. The
first state to mandate VMT reduction is Washington, whose H.B. 2815 was enacted in
March and took effect in June, and the goals here are based on that legislation.




Policy Design
Goals: Reduce VMT 50 percent per capita from a 2005 baseline by 2050Notes from
  12.4.08-full BTAG call
         – Non-motorized transportation, including:

                   •   Biking

                   •   Walking

           –   Water transportation (water taxis, etc)


Under policy BT-X, states will mandate a 50 percent reduction of per capita VMT, as
measured by the existing Highway Performance Measuring System (HPMS), by 2050,
with incremental goals for intervening years. States‘ transportation funding, home rule,
and other relative traditions vary, so implementation mechanisms will vary, and this
policy is purposefully general to allow for local adaptation and innovation. The policy
design described below is generic and meant to be adapted as needed. But the standard is
reachable. At the individual project level, research shows drastic reductions in
transportation demand by providing for mixtures of activities and compact forms (Table
1).
  Table 1. Reductions from the ITE trip generation norm from various projects. (CCAP)




The very local effect of good development will be magnified by reform of transportation
infrastructure provision, allowing MGA states to reach climate goals and avoid
bankrupting themselves and their citizens from the escalating costs of past practices

Timing:
The policy has the following incremental benchmarks for VMT reduction: 18 percent
reduction in per capita VMT by 2020, 35 percent by 2035, and 50 percent by 2050.

Parties Involved: State and local government, primarily DOTs and local agencies and
commissions with oversight of development.

Other:

Notes from 12.4.08-full BTAG call

           –   MI has non-motorized trails (walk, bike, etc); Use the non-motorized term
               to be more inclusive

           –   This is being debated now as part of the stimulus package – is there an
               opportunity for us to play a role. Timeline – many groups are now sending
               recommendations to the cmte. The stimulus bill will probably pass in
               January.

                  •   Options – vehicle stuff, infrastructure

                  •   Asks of Green Groups:

                          –   New start

                          –   Transit rehabilitation

                          –   Amtrak

                          –   Bike/ped

                          –   Anti-idling

                          –   Habitat connectivity

                          –   Highway stormwater

                          –   Fuels loan guarantees

                          –   SWOT team – Eric Sundquist
                     •   What should we work on:

                            –   Water transportation and ports

                            –   Rail transit

                            –   Biofuels possibly

                            –   Auto industry?? – focus may be on battery technology



Implementation Mechanisms
States mandate VMT reductions and are responsible for meeting the goals for intercity
travel. Local governments or MPOs are responsible for meeting the goals within their
jurisdictions, with allowance for through traffic beyond their control. States provide
technical assistance to localities, including review of ordinances.

Tools available to state agencies in meeting their obligations include:
     Moving spending from new highway capacity to ―fix it first‖ programs or to other
       modes, including intercity rail.
     Reviewing and potentially forbidding, via access restrictions or other means,
       developments with large regional VMT growth potential.
     Pricing mechanisms described separately.
     Establishing parking cash out and other TDM programs for large employers.
     Stop incentivizing high-VMT developments through TIFs and other economic
       development assistance.
     Require that DOTs and local governments plan for accessibility, rather than
       mobility, optimization.
Tools available to local governments, metropolitan planning association, municipal
planning associations, state agencies, ect in meeting their obligations include:
     Removing minimum parking requirements and replacing them with maximums.
     Requiring more compact, mixed development (with appropriate design controls).
     Establishing parking cash out and other TDM programs for large employers.
     Redeploying local spending from new capacity to ―fix it first‖ programs or to
       other modes, including ―complete streets‖ that are suitable for walking, biking,
       and transit.
     Stop incentivizing high-VMT developments through TIFs and other economic
       development assistance.

Related Policies/Programs in Place
These could include Recent Actions in XX Jurisdiction: Should this be only MGA
states?
Use brief paragraphs.
Or one or 2 lines.
Add bullets as needed.
Type(s) of GHG Reductions
Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings
Government funding for transportation infrastructure would be redeployed for no new net
costs; to the extent that reductions in new capacity will remove future needs for O&M,
there will be savings. MORE….


Data Sources:

CCAP (2003).

FHWA on VMT.

Wash. Stats, Chapter 14, Laws of 2008, Sec. 8.


Quantification Methods and Key Assumptions:
Methods are described above, as are key assumptions.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
   1. Use numerical listing.
   2. Keep the items brief – 1 or 2 sentences.
   3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                           BT-2.4: Freight Transportation


Policy description and design language taken largely from CREATE factsheets
,Appendix H of the Iowa Climate Change Advisory Group TLU 9 Freight Strategies, RE-
AMP transportation working group scoping document, and Appendix H of the MCCAG
TLU 9 Freight Strategies.
Policy Description

Overall the freight sector is at or near capacity for every mode of transportation. Better
truck technology, electrification of truck stops, vehicle efficiency improvements to
trucks, mode switches, practices to reduce vehicle miles traveled (VMT) in the freight
sector, and rail improvements are all needed to address the capacity constraints in the
freight transportation sector.


Policy Design
Goal:
       Reduce rail congestion and delays for freight transportation throughout the
        Midwest region by securing funding necessary to make efficiency
        improvements to current regional rail infrastructure.

The use of rail to move freight is a much more efficient method from an energy
consumption and greenhouse gas emission perspective. According to the Chicago
Regional Environmental and Transportation Efficiency (CREATE) Program:
    Moving freight by rail is four times more fuel efficient than other over-the-road
       alternatives;
    One gallon of fuel moves one ton of freight 436 miles by rail;
    Hauling one ton of freight coast to coast consumes 7 gallons of fuel by train
       versus 27 gallons of fuel by truck;
    A single intermodal train can take 280 trucks off the highways, the equivalent of
       1,100 cars; and
    500 trucks would be required to move as much freight as a single bulk commodity
       train.

National freight forecasts by the U.S. Department of Transportation estimate an 89%
increase in tons of freight by 2035. Infrastructure improvements are required to increase
the amount of freight that can be hauled by rail and to drastically improve congestion and
locomotive idling.

Work has been done in the region to determine the most efficient methods for improving
the freight transportation system, most notably the CREATE Program. The following
policy recommendations build upon the work already underway by state and regional
freight improvement initiatives.
The Chicago Regional Environmental and Transportation Efficiency Program
(CREATE) is a partnership between the State of Illinois, City of Chicago, Metra,
Amtrak, Association of American Railroads, and the U.S. Department of
Transportation. Chicago is the nation‘s rail hub and the rail improvements proposed
to be made by CREATE will increase the efficiency of the region‘s rail infrastructure.
CREATE includes 78 critically needed rail and highway infrastructure improvements
in Northeast Illinois. Projects include:
       25 Road/Rail grade separations to eliminate grade crossings, route roadway
        over or under rail line at crucial locations throughout the region;
       6 rail/rail grade separations, which will reduce chronic delays with bridges at
        key points where passenger and freight lines cross each other;
       47 railroad projects to reduce chokepoints and increase capacity;
       Grade crossing safety enhancements; and
       Viaduct improvements to upgrade safety and appearance of rail bridges over
        roadways.
The CREATE program was estimated to cost $1.5 billion in 2003 and to date $330
million has been secured to begin implementing a three-year plan (2007-2009) to advance
32 projects into final design or construction.
MGA states and relevant agencies should cooperate with the CREATE program to secure
the additional necessary funding from regional, state and federal agencies to implement
the remaining 46 identified rail improvement projects by CREATE.


Goal:
       Implement intermodal infrastructure efficiencies to improve the speed and cost of
        fright shipping across the region, while reducing greenhouse gas emissions from
        the freight transportation sector.
   Improvements in freight transportation need to be considered against improvements
    in all modes of transportation to determine the most efficient method for transporting
    goods across the region. Create more effective freight transition between modes at
    intermodal yards, ports, and airports.


Timing:


Parties Involved: U.S. Department of Transportation, MGA State Department‘s of
Transportation, Association of American Railroads, regional/metropolitan planning
organizations, shippers, developers, regional rail associations, and local units of
government.

Other: None cited.

Implementation Mechanisms
       Establish tax credits for rail expansion/preservation;
       Seek to remove, through regional, statewide and national planning activities,
        bottlenecks (both physical and operational) for the efficient movement of
        freight by all modes of transportation;
       Support initiatives to encourage railroad capital investment to increase
        capacity (e.g. tax credits);
       Identify opportunities for increased intermodal freight movement;
       Utilize federal Congestion Mitigation and Air Quality (CMAQ) funding to
        support rail freight improvements.
       Develop additional trucking lanes where needed to integrate with intermodal
        changes and upgrades;
       Move freight from interstates to alternative modes;
       Improve freight logistics to help with load matching, route, and schedule
        optimization;
       Develop and enhance feeder barge container shipping;
       Increase rail capacity and address rail system bottlenecks; and
       Integrate aviation, rail, and interstate networks to support connectivity.

Related Policies/Programs in Place
Michigan has a similar proposal to the CREATE program in climate process. It was
supported by participants.
These could include Recent Actions in XX Jurisdiction:
 Use brief paragraphs.
   Or one or 2 lines.
   Add bullets as needed.
Type(s) of GHG Reductions
For example: Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
List, if possible provide URL..

Quantification Methods:
Briefly describe in a paragraph/several sentences. Okay to refer to information supplied
above.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
    1. Use numerical listing.
    2. Keep the items brief – 1 or 2 sentences.
   3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
       BT-3.1: Advanced Transportation Technology Commercialization



Policy Description
Advanced transportation technologies

The Midwest has many advantages in pursuing a low carbon transportation system,
including a rich agricultural land base for producing biofuels and a large existing biofuels
industry, a large automotive manufacturing industry, a network of elite research
universities, and a variety of other manufacturers. This policy option is designed to
promote commercialization of advanced transportation technologies by taking advantage
of these regional strengths.

For the purposes of this policy option, an advanced transportation technology is one that
enables lower greenhouse gas emissions per mile traveled than current practice in the
region, and that is not currently available due to scientific, technical, or cost hurdles. This
policy option may support commercialization of low carbon fuels (e.g. advanced biofuels,
electricity, hydrogen), advanced energy storage technologies suitable for transportation
vehicles (e.g. batteries), advanced drivetrains (e.g. electric and fuel cell), and other
vehicle technologies enabling decreased fuel consumption or adoption of lower carbon
fuels.

This policy option should be designed to complement other policies supported by the
MGA Bioeconomy and Transportation Advisory Group. Specifically, decisions on
whether to support commercialization of specific low carbon fuels should be based on the
same life cycle GHG criteria developed as part of implementing the regional Low Carbon
Fuel Standard, and support should be offered to those fuels offering the greatest GHG
reduction. The same should be true for advanced vehicle technologies, with policy
support being given to those technologies offering the greatest GHG reduction potential.

Policy Design
Goals:
This policy option looks to promote the development of advanced transportation
technology facilities throughout the Midwest region by providing, incentives, financial
support, technological support, and training of the workforce.

The Advanced Conversion Technology Policy will:
   -    Support technology development in the following areas:
           o Commercialization of advanced biofuels including:
                      Feedstock characteristics more favorable to conversion of
                       cellulosic biomass to fuels, with a focus on feedstocks common to
                       the region.
                      Pre-treatment to enhance yields of sugars and other chemical
                       intermediates from biomass
                      Advanced biofuel conversion technologies with life cycle energy
                       and GHG benefits
           o Commericalization of battery technologies suitable for improving battery
             life and vehicle range in electric and hybrid-electric vehicles
           o Commercialization of hydrogen fuel cell vehicles, hydrogen production
             technologies, and hydrogen storage technologies.
           o Any other advanced transportation technologies


   -   Focus on the development of conversion technologies through the following
       stages:
           o Larger scale pilot facilities
           o Commercial demonstration plants approximate 10 percent of the size of
             full scale commercial production
           o Full scale commercial production




Timing:
Immediately
    Training and education should begin as soon as possible
January 1, 2010

      Funding should be made available

      Incentives should be in place

      Grants, debt financing guarantees, and tax credits should all be available

      Intellectual Property policies and regional regulatory policies should be in place
       to allow for faster tech transfer and faster project development.

Parties Involved:
The success of this policy option will depend upon a partnership between government
and private industries. State and local governments will be looked upon to provide the
necessary incentives, funding, and support for the development of these new technologies
up to the point of commercialization. Private industry will provide additional investment
and the advancements in technology necessary for the development and operation of the
plants.

Other: None cited.


Implementation Mechanisms
A funding mechanism will need to be created to foster the development of advanced
transportation technology up to the point of commercialization. To do this:
       -   Regional partnerships must be developed between state and local
           governments, universities, and private industry. These partnerships should
           focus on:
             o The creation of a cooperative environment where intellectual property
               developed in the region, remains in the region for the benefit of the region.
             o Making guaranteed loans readily available to industries developing
               advanced conversion technology.
           o Creating an environment where industry feels secure in making capital
               investments.
Select through a regional competitive proposal process up to six technologies that harness
regional advantages and are likely to develop the economy in the region. To insure full
value change integration
             o Competitive proposal process will be implemented as funding becomes
               available Funding will be derived from the public and private funding
               mechanism detailed below.
             o Criteria for selection will be carefully set to enable the selection of
               technologies with benefits to the region in the development and utilization
               of regional feedstock, enhancement of the conversion technology process,
               and in the end product. These criteria will be developed through a public-
               private partnership of those in the industry to determine where
               enhancements that can most benefit the commercialization of these
               technologies can have the most impact.
             o Should select across the three technology research areas (feedstock
               characteristics, pre-treatment, advanced biofuel conversion technologies)


Establish a public and private funding mechanism to take the targeted advanced
conversion technologies from pilot plant through demonstration stage. Important
elements of this mechanism include:
             o Use public funds to seed and leverage additional private capital resources.
             o Make the process ongoing
             o Make grants available for up to 25% of the costs to move the project from
               a pilot plant through a demonstration stage.
             o Provide debt financing guarantees for first commercial projects to prove
               the technology at commercial scale
             o Establish incentives such as tax credits (25%) for equity investments in
               high risk projects (like WI Act 255 for angel investment)1
             o Another possible model is what is happening in California under
               CAEATFA and their incentives program providing lease / purchase
               agreements that may result in certain zero emission vehicle (ZEV)
               manufacturing project transactions to be exempt from sales and use taxes.2
             o Develop financial support mechanisms for clusters of farmers and
               conversion technology plants in the form of grants, low interest loan
               guarantees, tax incentives, or other forms of incentives.

1
  Qualified new business ventures may be eligible to claim an income tax credit on that investment, equal to
12.5% in each of two years. (http://www.commerce.state.wi.us/BD/BD-Act255-QNBV.html) Bill
Summary available at: http://commerce.wi.gov/BDdocs/BD-Act225-Budget%20Changes.pdf
2
  CAEATFA Incentives: http://www.treasurer.ca.gov/caeatfa/incentives.asp
                      Have multi-year agreements to allow for appropriate feedstocks to
                       develop and fuel production plants


Form strategic partnerships with industry, the federal government, and investors to
leverage additional sources of funding to build regional innovation clusters that take
advantage of expertise in multiple locations and sectors to speed commercialization of
key technologies.
Fund the development of regionally focused programs to enhance and improve targeted
advanced transportation technologies.
Develop regional training programs to develop a skilled workforce capable of operating
and maintaining advanced technology facilities.
Establish Intellectual Property policies which will encourage entrepreneurial activities
and capital influx to targeted technologies at regional universities.
Adopt regional regulatory policies to streamline the permitting approval process for
advanced conversion projects to allow for faster development of these plants




Parties Involved
       -   Relevant state agencies
       -   Regional universities w/ relevant expertise
       -   Leaders of private industry located within the Midwest
       -   Investors
       -   Federal agencies

Related Policies/Programs in Place
       -   CALSTART – non-profit that works with the public and private sectors to
           develop advanced transportation technologies.3
       -   CAEATFA – The California Alternative Energy and Advanced Transportation
           Financing Authority provides financing for facilities that use alternative
           energy sources and technologies. It also provides financing for facilities
           needed to develop and commercialize advanced transportation technologies
           that conserve energy, reduce air pollution, and promote economic
           development and jobs. 4
       -   Sec 9008 of Energy title of Farm Bill5
       -   Reinvest in Minnesota (RIM)6


3
  CALSTART http://www.calstart.org/aboutus/?p=aboutus
4
  CAEATFA http://www.treasurer.ca.gov/caeatfa/
5
  USDA 2008 Farm Bill Renewable Energy Provisions
http://www.usda.gov/documents/FB08_Pub_Mtg_Renew_Energy_Factsheet.pdf
6
  Reinvest in Minnesota http://www.dnr.state.mn.us/grants/land/rim.html
Type(s) of GHG Reductions
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

Estimated GHG Reductions and Net Costs or Cost Savings
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

Key Uncertainties
The GHG emissions released from the advanced conversion technology plants that this
policy option promotes are uncertain at this point. It is the hope that any proposal for the
development of these plants will take their emissions into consideration and employ the
best management practices for limiting plant emissions

Additional Benefits and Costs
-   It is anticipated that the use of advanced transportation technologies will result in
    overall reduced GHG emissions
-   Lower GHG emissions have been linked to less air pollution and therefore health
    benefits.
-   Increasing the use of advanced transportation technologies in the region will create
    employment and economic benefits
-   Challenging universities, government, and private industry to develop the best
    available technology for improving the efficiencies at commercial plants should spur
    development and create partnerships and opportunities for all parties that extend
    beyond this policy option.
Feasibility Issues
The feasibility of this policy option is dependent upon (1) locating the initial capital
investment for the development of this technology and (2) securing the intellectual
property as it is developed.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
       BT-3.2 Technical Assistance to Advanced Technology Projects



Policy Description
Proving production at commercial scale is a technology‘s seminal achievement. Once
this has been achieved, new production facilities can then proliferate as fast as capital and
feedstock contracts allow. Mechanisms should be in place to support that proliferation
and aid in the development and proliferation of incremental improvements across all
production facilities and their corresponding feedstock and distribution infrastructures.

This policy option focuses on providing technical assistance to advanced technology
projects once they reach the point of commercialization.

This policy option provides mechanisms whereby technical assistance promoting the
development of commercial scale, production facilities within the Midwest region can be
both developed and shared with other facilities located in the region. Additionally, this
policy option will provide technical assistance to aid in improving alternative fuel
production efficiency, to aid in feedstock development and to aid in improved
distribution infrastructure of operating facilities.

Alternative fuels as defined in this policy option include all biofuels as well as any
advanced technology projects which would operate in a similar manner to fuels such as
supporting the technological development of batteries, fuel cells, and solar technology for
use within the transportation sector. Projects should be selected to receive technical
assistance based on life cycle greenhouse gas emissions guidelines developed to
implement a regional Low Carbon Fuel Standard.

Technical assistance to assist in efficient operation of alternative fuels production will
include the sharing of best management practices, ideas and theories, data to identify
successful solutions , and patents and other intellectual property

This policy option is intended to be broad in scope and to encompass the full lifecycle of
biofuels from the engineering of crops / feedstock and transporting the crops / feedstock
to making production facilities more efficient.

The sharing of technological advancements among participants in this program will be a
key to the success of this policy option, including what is developed at universities,
through government, and through private industry. The sharing of these new
technologies must flow in both directions.

Policy Design
Process

   1. States will support advanced technologies by providing funding for Front End
      Engineering and Design studies.
   2. A regional group of cooperative extension leaders should make recommendations
      on how extension can aid in providing technical assistance in development of
      advanced technology facilities in rural areas.
   3. The technology to be utilized and shared will first need to be developed by
      universities, government, and/or private industry.
            Partnerships between universities, government, and private industry will
             be created for the seamless sharing of this information. This partnership
             should include faculty and students from universities in areas where
             technology development would be applicable to commercial scale
             alternative fuel plants, industry leaders and plant managers from the
             private industry who can implement these new technologies, and
             government officials from departments focused on development and the
             facilitation of new technologies throughout private industry.
   4. The intellectual property (IP) rights for this technology will then need to be
      acquired by the facilities intending to use this new technology to develop or
      enhance their facilities.
              A mechanism for distributing new IP rights for these new technologies as
               they are created will need to be developed. As part of distributing these IP
               rights, commercial facilities will need to demonstrate their need and
               implementation plans for the new technologies. Additionally a partnering
               agreement will be developed between the commercial facilities and the
               parties responsible for developing the new technologies to insure that the
               utilization of the new technologies remains in the Midwest region.
              Funding will be made available for the development of these new
               technologies by establishing a public and private partnership funding
               mechanism. Elements of this funding mechanism will include:
              Use public funds to seed and leverage additional private capital resources.
              Make the process ongoing
              Make grants available for up to 25% of the costs for implementing the
               new technology
              Develop financial support mechanisms for clusters of farmers and
               conversion technology plants in the form of grants, low interest loan
               guarantees, tax incentives, or other forms of incentives. The goal is to
               have multi-year agreements to allow for appropriate feedstocks to develop
               and fuel production plants

Goals:

To promote the development of technological advancements which allow for more
efficient operation of commercial advanced technology projects within the transportation
sector. This increased efficiency should result in the reduction of GHG emissions from
these commercial plants and should stimulate growth and development of the facility,
creating more jobs, and a larger tax base for the community.

Timing:

May 1, 2009 – Partnership committee between universities, government, and private
industry will be formed. This committee will have the following six months to meet and
discuss what technologies are available, what is being developed, and what commercial
facilities in the Midwest can best utilize these technologies as they are made available.
January 1, 2010 – Technological advancements should begin implementation at
commercial plants.

Ongoing – The development of advanced technologies and improved efficiencies should
continued to be promoted, developed, and shared across the region, among the partners
involved with this policy option including universities, local and state government, and
private industry.

Parties Involved:

Universities, state and local governments including departments of agriculture,
transportation, and development, and private industry located or looking to locate to the
region that are interested in developing cleaner technology solutions to the transportation
industry.

Other: None cited.


Implementation Mechanisms
The key to the successful implementation of this policy option will be the open sharing of
advanced technology, improvements to efficiency, and intellectual property between
universities, state and local government, and private industry, including commercial
facilities and their partners who are directly involved in the development of these new
technologies and improvements in efficiency.

To effectively realize this ambitious goal a partnering agreement must be developed, be
agreed upon, and signed off on by all parties that will be directly involved with this
policy option. The issue of sharing intellectual property will be difficult to get buy-in
from all parties, particularly as the advanced technology associated with the IP will give
the private sector companies an advantage in the marketplace which they will not likely
be ready to share willingly without a partnering agreement that provides them with
advantages for being a partner.

Funding for this policy option will come from public private partnerships, as well as the
pooling of funds between states. Having this policy option be regionally applied as
opposed to being implemented on a state by state basis should both save states on the
costs of developing and implementing the policy and should provide greater divideds for
all parties involved. Additionally the research being done at the universities will provide
students with knowledge and hands on experience that will easily be transferred directly
into the marketplace. This will also provide the commercial facilities in the region with a
talent pool from which to recruit to their expanding workforce.

Related Policies/Programs in Place
-   Iowa Biotechnology Business Support7
-   New Jersey R&D Technology Programs8 - This is a more general program but could
    be useful in providing guidance

7
 Iowa Biotechnology Business Support http://www.iowabiotech.com/industry/business_support.htm
8
 New Jersey Research and Development Technology Programs
http://www.locationnj.com/Incentives_Technology.asp
-   Texas State Strategy on Advanced Technology9 - Another general program but
    contains the element of biotechnology
-   University of Wisconsin Biotechnology Center10 - Great point of reference for
    advancements in biotechnology

Type(s) of GHG Reductions
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

Estimated GHG Reductions and Net Costs or Cost Savings
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

 Note: While the technical assistance provided to advanced technology projects is not
directly quantifiable, the end result will provide for reduced GHG emissions as facilities
operate more efficiently, infrastructure for these facilities operates more efficiently,
feedstocks develop higher yields, and the utilization of lower carbon fuels and other
alternative fuels becomes more prevalent.

Key Uncertainties
The key uncertainty to the successful implementation of this policy option will be the
cooperative sharing, implementation, and feedback between all parties throughout the
region. To have this policy option operate as seamlessly as possible, a partnering
agreement must be developed which outlines the roles and responsibilities of each of the
parties involved.

Additional Benefits and Costs
-   It is anticipated that the use of biofuels and other advanced technology within the
    transportation sector developed as a result of this policy option will have a lower
    carbon content than gasoline and will therefore result in overall reduced GHG
    emissions
-   Lower GHG emissions have been linked to less air pollution and therefore health
    benefits.
-   Increasing the use of biofuels in the region will create employment and economic
    benefits
-   Challenging universities, government, and private industry to develop the best
    available technology for improving the efficiencies at commercial plants should spur
    development and create partnerships and opportunities for all parties that extend
    beyond this policy option.




9
  Article on Texas‘ State Strategy on Advanced Technology
http://www.texasnano.org/pdfs/SSAT_description_letter_2-14-05.pdf
10
   University of Wisconsin Biotechnology Center http://www.biotech.wisc.edu/
Feasibility Issues
The feasibility of this policy option will depend in large part upon the ability to develop a
partnering agreement between the universities, government, and private industry

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
               BT-3.3: Increase Regional Research Collaboration



Policy Description
Currently the Midwest is under-represented in the development of technology companies
in the emerging advanced transportation technology sector. The Midwest has many
advantages in pursuing a low carbon transportation system, including a rich agricultural
land base for producing biofuels and a large existing biofuels industry, a large automotive
manufacturing industry, a network of elite research universities, and a variety of other
manufacturers. In spite of the presence of such assets, the Midwest lags the coasts in the
number and scale of new company formations in biofuels, bio-agriculture, bio-forestry ,
biorefining, battery technology, hydrogen and fuel cells, and other advanced
transportation technologies. This is primarily due to the coastal concentration of the risk
capital community, the biotech community and of the large pharmaceutical, chemical and
energy industries. The Midwest must aggressively develop policy alternatives that will
capture the companies and technologies that can add high value in the emerging
transportation fuel and vehicle markets. The Midwest must leverage its existing natural,
people and intellectual assets so that it does not become relegated to providing low-value
commodity inputs for conversion to higher value products by companies located in or
controlled from other parts of the country.

This policy option should leverage the Region‘s exceptional research and intellectual
property generation capabilities in order to better bring them to bear on transportation
fuels, vehicles, and related technologies. This policy option should increase the
commercial results of cross-institutional collaboration at the Region‘s colleges,
universities and research institutions. In so doing this option should increase the number,
size, complexity and survivability of projects created with intellectual property generated
within the Region.

As part of this regional research collaboration, centers that bring together producers, the
research community, economic developers, and end users could be created to help build
collaboration between universities, government, and private industry and to help develop
new technologies and launch projects.

This policy option should be designed to complement other policies supported by the
MGA Bioeconomy and Transportation Advisory Group. Specifically, decisions on
whether to support commercialization of specific low carbon fuels should be based on the
same life cycle GHG criteria developed as part of implementing the regional Low Carbon
Fuel Standard, and support should be offered to those fuels offering the greatest GHG
reduction. The same should be true for advanced vehicle technologies, with policy
support being given to those technologies offering the greatest GHG reduction potential.



Policy Design
Goals:
By 2009: Appoint a group comprised of leaders from research institutions across the
Midwest to identify barriers to commercialization resulting from energy collaborations
among their institutions and to recommend policies and programs to further
collaborations and, more specifically the commercialization resulting from
collaborations, among these institutions.

By 2010: Develop and staff an information clearinghouse on advanced bioenergy
technology among those institutions doing research on the topic in the Midwest.

By 2010: Develop working relationships and agreements with risk capital sources in the
Midwest to help secure funding for projects resulting from this collaboration.

By 2010: Identify and catalog both commercial and academic sources of advanced
cellulosic and other low-carbon transportation fuel technology within in the region.

By 2012: Provide the funding necessary to provide grants needed to pilot three projects
resulting from technology developed by aggregating multiple technology sources from
Midwestern colleges, universities and commercial companies.

By 2025: Average fossil fuel inputs in the production of conventional biofuels in the
region will be reduced by at least 50 percent.

BY 2025: At least 50 percent of all transportation energy consumed in the region will be
supplied by regionally produced biofuels and other low-carbon advanced transportation
fuels, with the expectation that a significant and additional portion of the region‘s biofuel
production will help the U.S. meet a national 25 x' 25 goal.

Timing: As described above

Parties Involved:
       All research institutions in the Midwest doing research on topics related to energy
        crops; biomass to energy conversions; and bioenergy process technology.
       University technology transfer institutions in the Midwest.
       Midwestern venture capital funds and their managers.
       Midwestern college and university retirement and endowment funds and their
        managers.

Other: None cited.

Implementation Mechanisms
Implementation of this policy option will primarily be done by bringing research
collaboration groups together, comprised of universities, government, and private
industry to share ideas and new technologies.
   Promote ―innovation corridors‖ that connect multiple clusters of university and
    private sector expertise around specific issues. Corridors could be connected by high
    speed rail to improve the flow of people and ideas and improve the prospects for
    collaboration. The high speed rail investments proposed in another policy could be
    leveraged to create one element in these innovation corridors.
Related Policies/Programs in Place
-    The Council of State Governments has established through its Midwestern Legislative
     Conference an Agriculture and Natural Resources Committee a forum of state
     legislators to exchange information and ideas on key agricultural and natural resource
     policies.11
-    The Midwest Consortium for Biobased Products and Bioenergy, a group of four
     universities and three federal laboratories that work together to expand and improve
     the technologies for the conversion of plant material to industrial products.12
-    The Midwest Alliance for Renewable Energy13 Encourages the development of
     workable and renewable sources of energy to responsibly meet the demands of a
     growing Midwest economy.
Type(s) of GHG Reductions
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

Estimated GHG Reductions and Net Costs or Cost Savings
This policy option is qualitative only and GHG emissions resulting from this policy
option will not be quantified.

Note: While this policy option is not quantified, it is anticipated that the implementation
of this policy option will result in a reduction in GHG emissions through the
collaboration of research between universities, state government, and private industry.

Key Uncertainties
The greatest obstacle to successfully implementing this policy option is to not overlap,
duplicate efforts, or compete with other policies and programs which are already in place,
focusing on regional collaboration of research and technology. This can be overcome by
getting active participation by key members of the midwestern bioeconomy.

Additional Benefits and Costs
-    It is anticipated that the technological advancements shared throughout the region
     will result in the more efficient operation of alternative fuel plants and the extended
     availability of lower carbon fuels for use in the transportation sector, resulting in a net
     decrease in GHG emissions.
-    Lower GHG emissions have been linked to less air pollution and therefore health
     benefits.
-    Increasing research collaboration throughout the region will create new employment
     opportunities and economic benefits resulting from both increased efficiency and the
     further development of a burgeoning industry.


11
   Council of State Governments, Midwest Office
http://www.csgmidwest.org/About/MLC/Committees/Agriculture.htm
12
   Midwest Consortium for Biobased Products and Bioenergy
http://cobweb.ecn.purdue.edu/~lorre/16/Midwest%20Consortium/index.shtml
13
   Midwest Alliance for Renewable Energy http://www.renewmidwest.org/
-   Challenging universities, government, and private industry to develop the best
    available technology for improving the efficiencies at commercial plants should spur
    development and create partnerships and opportunities for all parties that extend
    beyond this policy option.



Feasibility Issues
The feasibility of this policy option will be largely dependent upon the willingness of
member of these groups to openly collaborate with one another. Incentives, mutual
benefits, and other ways in which to foster a collaborative environment may be necessary
to achieve full and open collaboration.

Moving beyond the intellectual property rights associated with technological
development and allowing it to be shared throughout the region by universities,
government, and private industry, while keeping this development within the region will
present a difficult challenge.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                 BT-4.1: Develop Midwestern Biobased Products



Policy Description
The Federal Government has established the USDA Biopreferred Program. Some states
have initiated similar programs at the state level but this development has been scattered
across the region. Given the top notch research institutions of the Midwest and the need
for the development of industry, it is imperative that policies be developed that foster and
grow the Midwest biobased products industry.



Policy Design
Goals:
The goal of this policy is to promote the sale, distribution, and use of biobased products
which are manufactured in the Midwest region. This can be done by developing
biobased product procurement rules at the state level, participate in a regional biobased
product procurement program with a common list of products, and expanding the
program further by creating a regional certification program and promoting it through
education and incentives for business participation as a means to foster biobased product
development.

Timing:
The policy should be implemented immediately upon approval.
The education and incentive programs should continue until biobased products have
achieved relative parity with competing products which are not biobased.

Parties Involved:
State universities and departments of agriculture as well as suppliers, manufacturers,
transporters, distributors, and retailers of biobased products should all be involved to
insure that this policy is widely understood, accepted, and followed.

The Midwest Consortium for Biobased Products and Bioenergy14 will be a great source
for input on developing this list of regionally manufactured biobased products. This
group currently made up of the universities of Purdue, Illinois, Iowa State, and Michigan,
and the government laboratories of the United States Department of Agriculture (USDA)
National Center of Agricultural Research Utilization, Ames Laboratory, and Argonne
Laboratory. It might be advisable for other regional laboratories and universities to
examine the possibility of joining the consortium.

This policy will be aimed at the retail markets for consumers, businesses, and
government as the biobased products being promoted through this policy will be very
wide ranging from fuels and biomass, to standard household cleaning products,


14
  The Midwest Consortium for Biobased Products and Bioenergy
http://cobweb.ecn.purdue.edu/~lorre/16/Midwest%20Consortium/
fertilizers, and building materials to name just a few of the markets that are anticipated to
be accessed through this policy.


Implementation Mechanisms

       o Develop a common list of all regionally manufactured biobased products
         This list would include all manufacturers, suppliers, distributors, and retailers of
         regionally developed and manufactured biobased products. This list would be
         made publicly available through a website, other published materials, and
         advertising to promote these companies and to make the public as well as other
         businesses which are a part of the biobased product supply chain aware of the
         biobased products that are offered throughout the region and where these products
         are available.

       o Develop a regional certification program
         A regional certification program would put forth criteria that manufacturers,
         suppliers, distributors, and retailers would have to meet to become certified. This
         could mimic what has been done at the federal level by the USDA‘s Biopreferred
         Program.15

               o Develop criteria for certification based on environmental, economic, and
                 social factors, and incorporate life cycle methods for comparative
                 evaluation of biobased vs non-biobased products for given uses.

               o As part of this certification program, a logo would be developed and used
                 to identify, manufacturers, suppliers, distributors, and retailers that have
                 become certified.

       o Develop and education and incentives program to promote the procurement of
         regional biobased products

               o Education: Develop marketing materials and a marketing program which
                 could help to inform both the public as well as other businesses interested
                 in participating in the program, what the certification program is about,
                 what the logo means, identify the criteria that a business must meet to
                 receive this logo, and identify the steps a business must take to be a part of
                 this program. This could include the development of a website, on-line
                 advertising, advertising through state sites, through businesses that have
                 been certified, as well as through informational booths to be set up at
                 conferences, summits, government events, etc…

               o Businesses Incentives:

                          Market these additional benefits to eligible businesses to
                           incentivize their participation in the program :
                                   Being a part of the regional education / marketing program



15
     USDA‘s Biopreferred Labeling Program http://www.biopreferred.gov/Labeling.aspx
                                 Having the regional certification logo placed upon their
                                  product, identifying it as being a biobased product which
                                  was manufactured in the region.
                                 Having access to the programs associated with the
                                  Biobased Products and Transportation policies being
                                  developed as part of the Midwest Governor‘s Platform
                                  including, but not limited to:
                                 Access to materials and technologies developed as part of
                                  the regional research collaboration
                                 Technological assistance in the initial commercialization of
                                  their product
                                 Continued technological assistance in further enhancing the
                                  efficiency of their processes
                                 Continued technological assistance in ensuring that
                                  sustainable practices are utilized in the manufacture of their
                                  biobased product.




Related Policies/Programs in Place
    All Midwest Procurement has committee looking at product conversion technology
    USDA‘s Biopreferred Program16
     ○   The USDA‘s Biopreferred Program contains a catalog of biobased products which
         would also be an excellent reference for further developing the list of biobased
         products from the Midwest region.17


    North Central Bioeconomy Consortium18
Type(s) of GHG Reductions
This policy options is qualitative only and will not be quantified.

Estimated GHG Reductions and Net Costs or Cost Savings
This policy options is qualitative only and will not be quantified.

Key Uncertainties
It is important that this policy coordinate with other efforts taking place at the federal,
regional, and state level to insure that efforts are not being duplicated, and more
importantly that efforts are not competing with one another.



16
   USDA‘s Biopreferred Program http://www.biopreferred.gov/?SMSESSION=NO
17
   USDA‘s Biopreferred Program‘s Catalog of biobased products certified through this program
http://www.biopreferred.gov/Catalog.aspx
18
   North Central Bioeconomy Consortium http://www.ncbioconsortium.org/
Additional Benefits and Costs
   1. Further development of the Midwest Bioeconomy
   2. The development of more sustainable products with less use of chemical and less
   greenhouse gas emissions.
   3. Health benefits associated with less pollution and less use of chemicals.
Feasibility Issues
None Cited

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
    BT- 4.2: Regional Infrastructure for Biobased Product Manufacturing



Policy Description
Taken from the Midwestern Governors Platform:
“A key to the advanced bioenergy complex will be the profitability of the manufacturing
of biobased materials that are co-products of biobased fuels. This materials industry is in
its infancy. Support research determining how the biomaterials supply chain can mature
in conjunction with the biofuels sector and how new products can achieve economic
viability.”

Policy Description:
A key to the success of any product is the efficient movement of product to market. The
existing regional infrastructure must be enhanced, further developed, and /or utilized as
efficiently as possible to support the efficient integration of these biobased products into
the region‘s system of moving goods. To do this, the entire supply chain, from raw
material state through manufacturing, distribution, and on to the retailers, must be re-
examined, options for improvements developed, and a plan for implementation be
designed and carried out.

Policy Design
Goal:

The efficiency of the regional infrastructure will be improved to support the development
   of the region‘s biobased products industry.

Timing:
This policy should be implemented as soon as approved. For those infrastructure options
that are deemed feasible a separate implementation plan will be developed based upon
the priority of that improvement and available funding.

Parties Involved:
All parties throughout the biobased product supply chain within the Midwest should be
involved in this policy option to identify their current transportation policies, their future
transportation needs, and how to more efficiently distribute their products. Additionally,
state departments of transportation should be directly involved, along with the Federal
Highway Administration, Federal Railroad Administration, and the Federal Maritime
Commission.

This policy should be initiated by the state departments of transportation, focusing on
brining companies throughout the bioproducts supply chain together to begin the
discussion on how best to streamline and enhance the transportation of biobased products
throughout the Midwest region and to market.


Implementation Mechanisms
    1. Bring together parties from the entire supply chain of biobased products to
       determine transportation modes, routes, and timing and begin the discussion on
       the manners through which the transportation of their goods can be conducted
       more efficiently. Develop a comprehensive listing of the key players in the
       regional bioproducts supply chain, including suppliers, manufacturers,
       distributors, and retailers..

    2. Develop a committee of these organizations to determine the modes that are
       currently being utilized to transport their products and the routes they are using.

    3. Initiate a regional study to determine where the supply chain is losing its
       efficiency (bottlenecks, inefficient routes, inadequate infrastructure, inefficient
       modal utilization) and to determine what the primary problems are with
       connecting suppliers, manufacturers, distributors, and retails.

    4. Study how the supply chain could be made to operate more efficiently, including
    additional infrastructure enhancements, developments, and even the utilization of
    more closely located suppliers, manufacturers, distributors, and retailers would then
    be undertaken. A list of potential infrastructure enhancement and/or development to
    this supply chain would be developed identifying how each supply chain
    enhancement and/or development will help to improve the overall efficiency of the
    supply chain. For policy option details see BT 2.1 and 2.2.

    5. Conduct a feasibility study on these proposed enhancement / developments to the
       supply chain.

           a. The feasibility study should take into consideration
               o Transportation time (gained or lost)
               o Cost of implementation
               o Fuel savings / increases
               o GHG emission reductions / increases
               o Any other relevant factors to be considered as part of the
                 implementation of the proposed transportation improvements

    6. Develop, submit and carry out an implementation plan consisting of identified
       feasible options.


Related Policies/Programs in Place
These could include Recent Actions in XX Jurisdiction:
 Use brief paragraphs.
   Or one or 2 lines.
   Add bullets as needed.
Type(s) of GHG Reductions
This policy options is qualitative only and will not be quantified, however this policy
may result in GHG reductions through various GHG reduction opportunities.
Greenhouse Gas Emissions Reductions Opportunities

The enhancement and / or further development of the Midwestern infrastructure will also
provide a prime opportunity to implement greenhouse gas (GHG) emission reduction
policies such as:

          Moving freight from highways / interstates to rail would assist in reducing the
           GHG emissions associated with transporting biobased products.
          Providing tax credits for the purchase of fuel-efficient / low-GHG
           transportation vehicles
          Developing emission-based tolling which would provide a tolling discount for
           clean vehicles.
          Facilitate the adoption of new clean technologies based upon the new
           proposed EPA criteria air pollutant emission standards for locomotive engines
           and commercial marine vessel diesel engines.
          Provide for pre-clearance at scale houses to reduce truck idling time
          Develop and enforce anti-idling ordinances and encourage the use of
           alternatives such as truck stop electrification
          Implement regular maintenance plans
          Provide driver / operator training on how to drive more efficiently
          Adopt green port strategies to reduce emissions for both vessel dwelling and
           for land-side cargo handling



Estimated GHG Reductions and Net Costs or Cost Savings
This policy options is qualitative only and will not be quantified.

Key Uncertainties
Weight limitations must be taken into consideration, particularly for trucking across
interstates as heavier loads take a greater toll on the roadways and increase the cost of
roadway maintenance.

Local governments must be directly involved to insure that local zoning policies do not
negatively impact the infrastructure improvements identified as part of this policy.

Additional Benefits and Costs
   1. Further development of the Midwest Bioeconomy
   2. The development of more sustainable products with less use of chemical and less
   greenhouse gas emissions.
   3. Health benefits associated with less pollution and less use of chemicals.
Feasibility Issues
None Cited
Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                         BT-5.1: Perennial Biomass Supply



Policy Description

The Midwest leads the nation in biomass production potential. A major challenge in the
effort to build a cellulosic biofuels industry is to establish a consistent, reliable feedstock
supply. The purpose of this policy option is to support the development of a perennial
biomass supply to enhance the synergies between farm economics, biofuels production
and environmental objectives, and to reduce greenhouse gas emissions.

Healthy, sustainable, and productive forests and agricultural lands provide a vast array of
environmental, social and economic benefits. Benefits from healthier farms and forests
can include increased rates of CO2 sequestration in plants, agricultural soils and forest
biomass in addition to increasing the availability of renewable biomass for energy
production. The elements of this policy option include:

1. Develop and expand programs and incentives that encourage landowners to grow
perennial crops and supply products to bioenergy plants, especially in sustainable
ways that target improvements in soil/water quality, wildlife habitat, soil erosion and
carbon sequestration.

Corn and soy will continue to be extremely valuable crops throughout the Midwest‘s
agricultural zones. A portion of these crops has recently been diverted into biofuels
production. Emphasizing cellulosic ethanol over food starch based ethanol will allow
added value for farmers and minimize unintended consequences in food supplies.

To ensure the highest level of effectiveness and participation in a sustainable biomass
development program, care must be taken to recognize the concerns and goals of
agricultural producers. Change, new technologies, and budding markets are a few of the
concerns from the producers that will need to be addressed Absentee landowners may
have very different long-term objectives and concerns than farmers who own their own
land. Absentee landowners hold almost 50% of arable lands in a number of states in the
Midwest.

Absentee landowners may seek moderate returns in favor of less intensive management
or experimenting with new, non-traditional crops. Also, if land is leased on an annual
basis, there is little incentive for nurturing perennial crops. Education programs that
demonstrate long-term benefits and a steady or growing product demand can alleviate
concern and facilitate acceptance of biomass feedstock development..


2. Identify appropriate locations for specific crops and where biomass production
enhances ecological restoration through the use of mapping, modeling and research.

Locating biomass production appropriately can have significant benefits for the
environment, producers and markets. Focusing on plantings in flood plains, riparian
buffer zones, highly erodible areas and land that would benefit significantly with a
perennial cover crop will reduce , nutrient runoff, soil erosion and improve watersheds.
Restoring wetlands can not only become a source for biomass but also a sink for nutrient
run-off and a way to sequester carbon.

3. Ensure a balance between land conservation, biomass production and
food/animal feed production including lands in Conservation Reserve type programs or
under conservation easements. These uses are not mutually exclusive. For example,
traditional row crops can be inter-planted with perennials that not only help with weed
control but also can be harvested for biomass. Lands under conservation agreements may
be able to have some biomass removed annually and still provide conservation benefits. .

Ensuring that some of these lands, or the buffer areas associated with these lands, are
moved into biomass production, will allow the product to remain in the region and add
value to the economy.

4. Implement voluntary land use tools and incentives that minimize the land use
conversion of suitable farmlands to non-agricultural uses and prevent the loss of forests
and wetlands to development. Conversion of these lands decreases the opportunities for
a diverse and geographically efficient supply of biomass.

5. Support the formation of biomass commodity groups similar to corn and soybean
commodity groups, which appropriately, form a strong constituency. The formation of
biomass commodity groups functioning regionally could significantly enlarge the sphere
of influence and the ability to draw incentives and financing for biomass projects. Other
organizations that unite growers, energy producers and end users are encouraged.

6. Develop quality controls for biomass to ensure that pests or invasive species are not
introduced or promoted. Provide a framework for standards, such as pricing structures,
as well as quality standards. Not all biomass is equal; specifications by type of biomass
or end-use could define quality parameters (such as Btu content, size, moisture content).
Producers need to be able to select biomass based on its energy potential and applicability
for its intended end product.

7. Develop incentives, technological innovation in equipment and a regulatory
structure to ensure necessary and consistent standards and pricing. Promoting new
markets that require new kinds of feedstocks simultaneously can be problematic. (See
BT-1.1, BT 4.2, BT-6.1)



Policy Design
Some states are laying important groundwork by using modeling and research to
determine the types of perennial crops that would be profitable, efficient and effective to
grow and/or harvest for biomass-to-energy use. Identifying where these crops are most
suitably and sustainably grown from an ecological perspective is of equal importance.
Likewise, identifying forests where thinning and biomass removal would be ecologically
beneficial, and geographically efficient for transport, is another important modeling
requirement.
Gather existing research and engage universities. (See also BT-3.3: Increase Regional
Research Collaboration)
Evaluate the life cycle energy costs and carbon emissions for each feedstock. Each
product needs to be evaluated in terms of its contribution to reducing GHG through
displacing use of fossil fuels, carbon sequestration, reduction of fertilizer use (N20), and
reduction of water use. It‘s recognized that starch-based ethanol production does not
have a consistently positive life-cycle energy footprint. Diverting food and animal-feed
to produce energy can have a negative impact on supply and prices. Therefore, ethanol
based on these sources should be considered a bridge technology as we transfer to
cellulosic ethanol production. Likewise other feedstocks which do not demonstrate a
consistently positive life-cycle energy cost and sustainable production should be phased
out in favor of sources that do meet those criteria.
Explore new opportunities and technologies, such as: employing biochar for reducing
CO2 emissions, sequestering carbon and improving soil productivity; and developing
environmentally benign methods of stimulating growth of biomass.
Education and outreach, especially for citizens and land managers, will be an important
part of this goal both to underscore the importance of biomass and to teach best
management practices (BMPs) for forests and biomass production on agricultural lands.
Each state should develop model curriculum for education

Agricultural land provides economic, social and environmental benefits to the Midwest,
including carbon sequestration in the soil. Among agricultural best practices, no-till
farming, residue mulching, cover cropping, and crop rotation enhance carbon
sequestration in farm soils and allow for sustainable production of biomass.

All biomass products will be sustainably harvested without depriving soils of important
organic components for reducing erosion but will maintain soil nutrients and structure
and will not deplete wildlife habitat or jeopardize future feedstocks in quantity or quality.
Develop or adopt existing voluntary land conservation programs such as conservation
easements, open space programs or conservation reserve type program.

Through appropriate state programs and agencies, assist in the formation of biomass
commodity groups either by sub-region or by specific type of biomass, i.e., a Midwest
Forest Biomass Producers.



Goals:
        Inventory biomass resources. How much land is developable for biomass
         production and what is the availability of mechanisms for developing? Conduct
         this assessment as a regional process or by state. Regional assessments ensure
         consistent criteria for collection. Use consistent methodologies so data can be
         compared across state lines. Complete these complimentary analyses by 2010.
        Identify clear sustainability guidelines and best management practices for biomass
         production and harvest by 2010.
        Develop a credible database of amount of land suitable for sustainable biomass
         production in each state by 2012.
        Each state will have some form of biomass utilization incentives program by
         2012.
      Develop to the Midwest‘s full potential appropriate sources of biomass and
       production facilities by 2025, to enhance the economic vitality of our region.
      Identify regional demonstration project opportunities by products associated with
       particular ecological zones. Products may be grouped for analyses such as
       food/organic wastes; forest/wood chips; switchgrass/perennial grass; industrial
       residue; crops (oil seeds and grains); other crops (corn, soy, sorghum, sugar beet)

Timing: See above

Parties Involved: Farmers; co-ops (Cenex/farm members); academia; environmental
groups; energy companies; government agencies; farm organizations; forest land owners;
timber and agriculture companies; polymer, chemical, power industries; external
agencies; partners in demonstration projects

Implementation Mechanisms
When developing models and mapping as described above, and evaluating the results,
criteria should include:
      Availability of suitable land;
      Conversion rate of lands;
      Effect on existing uses;
      Range of products;
      Production and storage equipment;
      Geographic range to production facilities and point of use;
      Transportation and harvest logistics;
      Change in environmental services of land in context of production scenarios;
      Habitat enhancement;
      Income; and
      Carbon sequestration potentials.

Other potential implementation mechanisms include:
    Fund research development at land grant colleges (in collaboration with
       producers) to identify most effective biomass feedstocks by ecological zone and
       the most efficient ways to utilize them.

      Incentivize conservation and production of biomass on appropriate lands. Create
       programs to provide financial payments to land owners by providing direct
       assistance to farmers to convert of select crop lands and adjacent buffer lands to
       perennial biomass production. Incentivize production facilities to create a local
       market for biomass producers.. A two-pronged approach is required to
       coordinate and connect supply and demand. Methodologies for connecting
       producers to markets on a local basis would be highly beneficial.

      Use biomass production as a means of land restoration. Identify and characterize
       options, opportunities and guidelines by ecological zones using modeling to
       identify areas of highest priority that can be protected by planting of perennial
       biomass crops. Avoid sensitive areas except where sustainably managed
       plantings can improve slope stability, erosion, habitat and water quality.

      Encourage conservation easements on ecologically important lands that do not
       preclude biomass production. Adjust Conservation Reserve Programs (CRP) to
       allow for biomass production that does not compromise the original purpose of
       the reserve.

      Apply best management practices to current row cropping systems that could
       include inter-planting of perennial crops. Increase the use of perennial crops in
       buffer systems.
      To combat potential economic problems with land or crop conversion, target
       incentives based on additional ecosystem services, such as identified in carbon
       markets, not just market price of current crops. (Some conservation benefits can
       be directly valued, others are more difficult to quantify.)
      Develop regulations for payment protection for producers and some form of
       pricing mechanisms.
      Develop quality control standards that include sustainable harvesting guidelines
       and could lead to a certification system.

Related Policies/Programs in Place
There are a plethora of federal, regional and state programs and policies that
complement this policy option. The following are examples, not an inclusive list.

2008 Farm Bill includes energy crop incentives for growers and new funding for
converting fossil fuel power to biomass. Of great significance is the Biomass Crop
Assistance Program (BCAP). This new program directs USDA to establish project areas
in which potential biomass producers and a biorefinery or another facility agree to
produce and use biomass crops for conversion to advanced biofuels or bioenergy. The
program excludes commodity crops, food, wastes and algae.
     Pays producers up to up to 75% of costs for establishing and planting crops, plus
     annual payments to help compensate for lost opportunity costs until crops are
     established.
     Provides cost-share payments for collection, harvesting, storage, and
     transportation costs at a rate to match the biomass sale price, up to $45 per dry ton.
     Requires that all projects follow conservation or forest stewardship plans.
     BCAP selection criteria includes environmental, community ownership and other
     desirable conditions, and expresses a preference for perennial crops, highly energy
     efficient annual crops, and preserving natural resources.
     Funded with uncapped mandatory funding; at approximately $70 million over
     five years.
Reinvest in Minnesota-Clean Energy (RIM-CE) is an innovative model policy to
incentivize feedstock supply. It is structured similar to a conservation reserve program
but focused on producing biomass with payments based on tiers of sustainable practices
that needed to be met. The types and number of practices implemented would affect
price. The policy has been passed in Minnesota, but the legislature has waited on full
funding to see how the Farm Bill 2008‘s Biomass Crop Assistance Program (BCAP)
would be addressed. MN may have more fully developed guidelines and be more useful
in using as a model for the region.
Michigan, Minnesota and Wisconsin already have specific statutes and regulations that
stipulate best management practices (BMP‘s) for water, soils, and wildlife during forest
management activities because forest biomass harvest will take place in conjunction with
logging. Minnesota has additional biomass harvest BMP‘s in place, with Wisconsin and
Michigan following suit. Biomass harvest needs to be done in conjunction with logging
and pulp because of the need to capture the whole value chain.
Each state has a conservationist (IA, WI, MN gives this role high priority). Water
protection using cover crops is an indentified priority but still trying to create a market,
especially for cellulosic ethanol and CHP.
State outreach and education programs to private landowners such as those found in
Minnesota, Wisconsin and Michigan.
Wisconsin has The Buffer Initiative to identify size and types of biomass that can be
grown in buffer areas. http://bombadil.lic.wisc.edu/WBI/index.htm
Cooperative Conservation Partnership Initiative: Upper Midwest should participate as a
region.
Reinvest in Energy Clean Energy Program based on Conservation Reserve Program lands
in Minnesota focuses on creating environmentally beneficial production of biomass for
cellulosic fuel production.
VeraSun Energy produces fuel-grade ethanol and distiller‘s grains in 17 production
facilities throughout the Midwest. Observing their policies and practices could allow for
tech transfer of operations of other related industries as well as provide real-time
examples of biomass to producer relationships and supply chains.
The United States Department of Agriculture‘s Natural Resources Conservation Service
(NRSC) and Farm Service Agency (FSA) manage programs such as Environmental
Quality Incentive Program (EQIP) and Biomass Crop Assistance Program (BCAP) to
assist landowners in biomass production.
The Private Landowner‘s Network provides a list of resources that includes federal,
regional and state programs, including funding opportunities, to assist private landowners
in sustainable land management including biomass production.
http://www.privatelandownernetwork.org/grantprograms/index.asp?pp=true
North Dakota HB 1515 creates a biomass demonstration project and incentives for
biomass development.
A budding organization in Wisconsin is connecting utilities with cellulosic experts but is
in need of growers to include in the network.


Type(s) of GHG Reductions
Primarily CO2 from replacing fossil fuel based sources of energy with biomass.

Estimated GHG Reductions and Net Costs or Cost Savings
This policy option is too broad at this time to accurately predict specific costs, savings or
greenhouse gas reductions.
Key Uncertainties
The effects of the economic downturn on the ability of states to provide incentives and to
initiate programs related to biomass. Private investors will likely remain fairly inactive in
the marketplace until the effects and recovery trend from this economic crisis are clearer.

Additional Benefits and Costs
      Biomass converted to energy or transportation fuels develops a new revenue
       stream for private landowners where a material that was thought of as waste now
       can provide income.

      Planting flood prone areas, riparian areas and buffer areas for biomass production
       increases wildlife habitat, modifies run-off events, captures heavy metals, reduces
       nitrogen contributions to water ways and reduces dependence on food-producing
       lands for the production of biomass.

Feasibility Issues
      Research gaps
      Determining driving forces and responding in a timely manner to market forces,
      Quantifying realistic, reliable supply or demand volumes.


Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                  BT-5.2: Biomass Feedstock Supply Logistics



Policy Description
Effective logistics for production, harvest, transportation and storage are keys to any
successful biomass to energy program. The policy options focuses on providing
technical assistance and incentives to projects seeking to develop and maintain a supply
of cellulosic biomass for bioenergy projects. Specific areas to address are:
1. Define and support planting and crop rotation systems that allow for biomass
production and harvest over the widest range of time possible to minimize handling and
storage needs.
2. Develop processes and programs that support the densification of fuels to increase the
relative energy intensity by volume of biomass feedstock being stored and transported.
This includes pelletizing and compressing materials as well as providing the equipment
and infrastructure to handle, sort, store and transport new forms of feedstocks.
3. Develop and use innovative storage systems that maintain the quality and embodied
energy of feedstocks over time so the year-round quality and quantity of biomass remains
consistent.
4. Standardization of weights and measures for biomass feedstock as addressed in BT-
5.1 are important to ensure quality in materials and reliability in product and price.
5. Regional studies to strategically locate processing facilities nodes between suppliers
and end-product industries are required. Communities in these key areas should be
encouraged to participate in the planning and support of these critical supply chain links
through business incentives, tax advantages and upgrading and/or utilization of facilities
for handling this new form of energy. Brownfield conversion presents an opportunity to
participate in this new economy. (See BT-6.1 and 6.2 Wealth and Job Creation Options.)
6. Ensure that rural roads and travel-ways are suitable and sustainable for the year-round
transport of biomass feedstocks. Cost-sharing programs may ameliorate impacts to
counties where all who benefit from the maintenance of the transportation infrastructure
contribute to its upkeep. Transportation planning should be sensitive to safety and
quality of life impacts to residents who also rely on these travel-ways.
7. Using the most fuel-efficient transportation and most energy efficient processing will
keep the life-cycle energy costs of biomass feedstocks low and add to the overall
emission reductions sought.
8. Municipal solid waste that is combustible or digestible is a part of this policy.
Locating processing plants as close as possible to solid waste collection points is
important to reduce transportation costs and tipping fees. Streamlined sorting
mechanisms will maximize energy output and minimize the release of toxic elements.
This also has the benefit of reducing methane, a potent GHG, emissions from landfills.
Research and technology advancements may be necessary to facilitate these conversions.


Policy Design
Facilitating Change:
        Evaluate degree and type of change necessary to existing infrastructure. Seek key
         leverage points where change will encourage and facilitate further improvements.
        Identify and support new opportunities in community economic development
         through participation in the supply chain logistics and plant location.
        Midwestern jurisdictions need to implement policies and funding schemes to fill a
         gap in federal programs for equipment and storage for biomass feedstock
         production.
Locating Sustainable Sources:
        Use USDA Forest Service inventory data (FIA) and Timber Products Output
         Mapmaker (federal resource from USDA) to provide supply and location data of
         potentially available forest biomass. Supply estimates need to be mapped and
         correlated with ownership regionally and comprehensively to determine
         sustainable utilization.
        Adjust current policy to allow short-rotation fiber production under traditional
         private forestry land programs and associated tax programs.
Defining Flow:
   •     Define the connections and pathways between ground and market: look
         sequentially from farm/forest (source) to market (geographic zone).
   •     Using the FIA data and resource mapping can help identify the largest zones
         where biomass is available to aid in plant and infrastructure location decisions.
   •     Where the distance is too great between individual production sites and
         processing facilities, develop key gathering, densification and storage
         (concentration) sites for more economical transport.
   •     Investigate the use of rail in intra-region transport of densified biomass.
   •     Utilize existing tools such as the BioFeedstock Logistics Simulator, developed by
         a company in San Jose, CA. It was developed to model and analyze the
         transportation and receiving operations of biomass feedstocks delivered from on-
         farm storage facilities to the receiving facility at a cellulosic ethanol plant.
Funding:
   •     Consider 80:20 state match of Biomass Crop Assistance Program to help incent
         project development in the region. (USDA, Farm Services Agency)
   •     Look at innovative loan programs to provide additional financial support to
         shipping and handling facilities and infrastructure.
Maximizing Efficacy:
        Identify, by product, the potential feedstock contribution to reducing GHG
         through displacing use of fossil fuels and carbon sequestration to determine the
         most effective feedstocks.
Goals:
1. Create a regional map of existing and potential production sites based on biomass
   sources. Connect the production sites to regional processing nodes, and where
   necessary, concentration sites.
2. Evaluate travel routes for suitability for predicted traffic volume and types.
3. Invite competition between zones within the region for proposals to develop and
    support a biomass supply chain. Reward the most innovative, energy efficient
    proposals with funding through grants and loans.
Timing: Accomplish the above goals by 2011.
Parties Involved: Rural and country transportation and development planning
   departments, biomass producers, biomass processors, universities, freight
   transportation sector, USDA

Need to talk about water transportation as well as rail – don‘t overlook barges down the
Mississippi, etc
Implementation Mechanisms
      Evaluate the feasibility of converting underutilized or vacant facilities to regional
       collection and storage centers.
      Develop regulations for aggregators and regional collection centers for
       densification. Such regulations are necessary so there is consistency in product
       and results. (For example, corn elevators are regulated in every state)
      Provide development, direct assistance and technical support to broad array of
       sustainable and cost-effective transportation modalities. Reduce fees for
       transportation of biomass.
      Encourage research and development at colleges of technology

      Incentivize conversion technology within industry

      Build showcases, especially of scalable technology, for the production, harvest,
       transport and storage of biomass feedstocks.

Related Policies/Programs in Place
2008 Farm Bill includes energy crop incentives for growers and new funding for
converting fossil fuel power to biomass. Of great significance is the Biomass Crop
Assistance Program (BCAP). This new program directs USDA to establish project areas
in which potential biomass producers and a biorefinery or other facility agree to produce
and use biomass crops for conversion to advanced biofuels or bioenergy.
     Pays producers up to up to 75% of costs for establishing and planting crops, plus
     annual payments to help compensate for lost opportunity costs until crops are
     established.
     Provides cost-share payments for collection, harvesting, storage, and
     transportation costs at a rate to match the biomass sale price, up to $45 per dry ton.

Energy Policy Act of 2006 – The Renewable Fuel Standard will double the use of ethanol
and biodiesel by 2012 and provides that in 2013, 250 million gallons a year of cellulose-
derived ethanol be included. This amount will require a conservative estimate of 3.5
million dry tons of biomass, less than 1% of what is available nationally.
USDA, Natural Resources Conservation Service‘s Cooperative Conservation Partnership
Initiative (CCPI) is a voluntary program established to foster conservation partnerships
that focus technical and financial resources on conservation priorities in watersheds and
airsheds of special significance. Under CCPI, funds are awarded to State and local
governments and agencies; Indian tribes; and non-governmental organizations that have a
history of working with agricultural producers. The Upper Midwest could participate as
a region.

The Bioeconomy Institute of Iowa State University has addressed the issue of biomass
transportation through the HST (Harvest, Transportation and Storage) Consortium. See
http://www.biorenew.iastate.edu/research/harvest-storage-and-transportation-of-
biomass.html

Type(s) of GHG Reductions
Primarily CO2 from the reduction of fossil fuel use for energy and transportation and
greater efficiencies in the harvest, storage and transportation of biomass for energy and
fuels.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
Transportation Logistics for Biomass for Industrial Fuel and Energy Enterprises, a
presentation by Purdue University, Biofeedstock and Particulate Technology Research
Group. www.jgpress.com/bcre07/t10.pdf

Design, Simulation, Analysis and Optimization of Transportation System for a Biomass to
Ethanol Conversion Plant by Poorna Ravula, University of VA
scholar.lib.vt.edu/theses/available/etd-05072007-165454/unrestricted/Dissertation.pdf

Quantification Methods:
This policy option has not been quantified.

Key Uncertainties
None cited.

Additional Benefits and Costs
      Improved transportation systems can be used for more than biomass transport.
      Utilizing unused facilities for storage reduces overall costs while recycling vacant
       buildings.
      Actions in this policy option can increase local wealth and community stability.
Feasibility Issues
      Research gaps
      Determining driving force, supply or demand.
Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                        BT-6.1: Bioeconomic Wealth Creation



Policy Description
The Midwest is ideally positioned to benefit from the movement from a petroleum-based
toward a bio-based economy due to its strong agricultural and forestry bases and the
presence of some of the nation‘s best research colleges and universities. The Midwest
must build on the pattern of success established by the initial farmer owned ethanol
plants. Keeping feedstocks, production and markets in the region, strategically
coordinated and interrelated, will keep more dollars circulating in Midwestern
communities

The entire corn ethanol business has been primarily a product of the Midwest as
evidenced by the fact the of the 207 fuel ethanol plants functioning or under construction
in the United States, 152 are located in Midwestern and Great Plains states. Most
importantly, 50 to 60% of Midwestern ethanol production are primarily farmer-owned,
limited liability corporations as opposed to absentee, Wall Street investors.
In the past, strong state programs, primarily through producer credits, have encouraged
local producers to initiate processing plants.

The presently nine billion gallon-annual ethanol industry has created jobs in the facilities,
and in the myriad of related industries. However, transferring this incredible local
success story to the Second Generation Biofuels production will be a challenge.

Presently, commercialization of new technology requires capital investments outside of
the realm of the farmer-owned corporations. Out-of-region venture capital funders tend
to focus on solutions outside of the region rather than supporting the existing regional
infrastructure.

This policy option is designed to encourage and facilitate the development of funding and
investment sources, business interests, and entrepreneurs in deploying technologies
developed in the Midwest, pursuing business opportunities associated with the emerging
bioeconomy as quickly and as significantly as possible, and accruing to the region and its
local communities the value-added margins available from these new technologies.


Policy Design


Goals:
        By 2010, establish a regional work group to study and provide recommendations
         on the removal of barriers preventing cooperatives and local funding entities from
         receiving government and grant monies for technology improvements to existing
         biorefining facilities.
        By 2012, establish a fund to provide $50 million in underwriting for capital
         improvements to existing fuel ethanol facilities in the Midwest that meet the
         policy criteria listed above.
      By 2011, create a regional business development office to develop key
       technologies that best leverage Midwestern intellectual capital and other assets in
       the bioeconomy, and emphasizes:



Implementation Mechanisms
Support infrastructure mandates that enable the Midwest to ramp up agricultural-based
energy (e.g. all new pumps must be certified to higher ethanol blends), even if they do
not mandate its use.
Develop diverse and innovative funding strategies such as bonding authorities, removing
barriers to entry for small producers, and diversifying financing methodologies.

Establish bonding authority or access to bonding funds for co-ops, municipal utilities, and
other local and community-owned entities to fund biomass projects and to, wherever
possible, make the opportunity available for local ownership in projects receiving public
investments.
Develop an IPO (Initial public offering) showcase for each class of bioenergy to
encourage greater private venture capital investment.

Organize periodic major regional events that pull togggether the Midwestern Governor‘s
Association, financial players and industry to leverage resources that can be matched
with federal dollars

Fund sources of new crops or innovative uses of existing crop residues for cellulose to
ethanol production.
Establish a clearinghouse to seek and match investment capital and philanthropic funding
for bio-based economic development and reduction of GHG emissions to communities
and business.

Establish state and regional programs
     to underwrite loans to existing biofuel facilities to purchase fixed cost technology
        that will accomplish one or more of the following:
         Reduce GHG emissions
         Improve the energy balance of the facility
         Improve the productivity of the facility (defined as an increase in the value of
            total products produced vs. the cost of the inputs of production)

Establish state and regional task force(s)
                 to remove barriers that would prevent cooperatives and other forms of
                   local and community-ownership from participating in government
                   incentive programs in the bioeconomic sector.

      to work with university technology transfer departments to provide incentives to
       keep in the Midwest businesses formed from bioeconomic intellectual property
       developed at Midwestern colleges and universities.
Create a regional-level bioeconomic business development office that will connect
emerging bio-based businesses in the Midwest to Midwestern Angel and venture capital
sources as well as grant and philanthropic funds providers.

Fund the conversion of corn ethanol plants into advanced cellulosic ethanol production:
encourage any new facilities to have conversion options built-in.
Develop policies that balance the use of land for natural services, community values and
producer income.
Develop integrated business model structures that incorporate as many components of
community advantages as possible.


Related Policies/Programs in Place
The House of the General Assembly of Georgia has completed a comprehensive study of
Bioeconomic Development with a far-reaching list of recommendations covering all
aspects of this policy option.
Current state ethanol production credit programs can serve as models for development of
production credit programs for next generation biofuels production. A complete listing
of these is available at www.deseire. Com.
Resource: Database of State Incentives for Renewable Energy; www.dsireusa.org




Type(s) of GHG Reductions
Expected greenhouse gas reductions will be from carbon dioxide, through reductions in
the amount of fossil fuels and education and awareness from new business opportunities
in bioeconomy sector.

Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
Real-life Economics: Understanding Wealth Creation by Paul Ekens and Manfred Max-
Neff
Transition to a Bioeconomy: Environment and Rural Impacts. Farm Foundation
http://www.farmfoundation.org/news/templates/template.aspx?articleid=401&zoneid=85
Transition to a Forest Bio-economy: A Community Development Strategy Discussion by
Sylvie Albert, Faculty of Management, Laurentian University, Ontario, Canada.

Quantification:
Because of the far-reaching and diverse options recommended, it was not possible to
neither quantify the potential reductions in greenhouse gases nor determine a cumulative
cost for specific actions by state or region.

Key Uncertainties
Given the uncertain economic times and potential difficulty in raising venture capital or
bank loans, commitment to change may be less than enthusiastic in the short term.
However, these recommendations will lead to greater long-term diversification and
financial stability.

Additional Benefits and Costs
Thriving communities and quality natural landscapes attract a broad base of businesses.

Feasibility Issues
None cited.

Status of Group Approval
The group has approved these recommendations conceptually. Final approval pending.

Level of Group Support
TBD

Barriers to Consensus
None known.
                  BT-6.2: Bioeconomic Workforce Development


This policy focuses on labor force development in emerging industrial niches in the
bioeconomy and in energy efficiency. It is recognized that parallel efforts to develop and
sustain the intellectual capital and human resources necessary to design and engineer
policy, systems and structures includes land use planners, engineers, developers, and
inspectors who understand green design and the bioeconomic society. These are degreed
positions and not the target of this policy option.

It is the purpose of this policy initiative to create collaborative workforce development
programs between industry, state governments and educational institutions that will staff
and drive the development of bioeconomy and clean energy jobs.

The technologies and processes associated with the bio- and green-energy economy
present possibilities for replacing jobs lost due to displacement from globalization with
jobs requiring similar skills in this emerging sector. Investing in workers with more than
high school, but less than a four-year degree will insure the accrual to the Midwest of a
significant percentage of the value to be created by the new bio-based and green energy
economy.

Policy Design

Goals: A series of key principles has been outlined by the ―Greener Pathways‖ study
sponsored by the Center on Wisconsin Strategy, the Workforce Alliance and the Apollo
Alliance. These same principles should guide policy initiatives in the Midwest:

1. Develop a focused approach by building on a solid foundation of labor market data
and analysis:
       a. Target specific sectors within the ‗green jobs‘ area
       b. Use good labor market data to drive initiatives
       c. Measure and evaluate new jobs programs as they are created

2. Build good jobs through partnerships, linking economic development and job creation:
       a. Employ energy standards as green job creation tools
       b. Promote bioeconomy and green energy clusters
       c. Link economic development in the sector to workforce development
       d. Develop coalitions and partnerships
       e. Integrate green jobs initiatives into existing workforce systems
3. Focus attention on job quality, access for all, and upward mobility in the green
   economy


   Timing:
2009 — Establish coordinators in each state‘s Department of Workforce Development

2010 — Establish state funds for investment in curriculum, equipment and other needed
resources to move job training from the general to the specific in regard to green jobs.
2010 — Establish a Midwestern or state-level funds source to better survey and track
industry requirements so as to develop job data that is specific to the needs of
bioeconomy and green energy companies.

2010 — Conduct a region-wide review on a state-by-state basis to determine existing
bioeconomy and green energy initiatives and requirements in order to better optimize
efforts to use policy and standards to drive economic development and green job creation.

Parties Involved: Economic Development and Workforce Development departments of
the Midwestern states; Management of the technical college systems across the Midwest;
Management of other two and four year college programs involved or potentially
involved in green job training programs; unions; Departments of Administration of
Midwestern states.

Other:

Implementation Mechanisms
Involve a the key players in partnerships among employers, unions, community-based
organizations, and public-sector institutions to create strong local and regional workforce
development programs for the emerging bioeconomy..

Establish coordinators in each state‘s Department of Workforce Development that are
responsible for:
    a) Focusing on and coordinating the transition of jobs programs from generalized
        skills toward green and bioeconomy-specific skills; and
    b) Coordinating resource deployment across the Midwest to optimize job training
        investment and resources and to avoid unnecessary duplication of expense and
        effort.
    c) Tracking current job losses and determining which categories of displaced
        workers are good candidates for training for green jobs.
    d) Working with industry partners to understand and predict the industry job market
        requirements and to develop curriculum and programs to meet those industry
        needs.
    e) Developing labor standards and safety programs that address changes in work
        settings and potential job hazards.

   f) Working with Government, Industry and Labor to establish pay scales that reflect
      skills required and be sufficiently competitive to encourage participation.


Establish state funds for investment in curriculum, equipment and other needed resources
to move job training from the general to the specific in regard to green jobs. (For
example, invest in providing wind turbine motors to help move a generalized electrical
technicians program toward a specialized wind turbine repair and installation program).

Establish a Midwestern or state-level funds source to better survey and track industry
requirements so as to develop job data that is specific to the needs of bioeconomy and
green energy companies.
Conduct a region-wide review on a state-by-state basis to determine existing bioeconomy
and green energy initiatives and requirements in order to better optimize efforts to use
policy and standards to drive economic development and green job creation.

Invest in the development of workforce training programs that:‘
    Tie development of projects and the industry to specific training options in
        technical schools and other education providers to ensure the necessary workforce
        is available.
    Stress on-the-job training as an important facet of workforce development.
    Work with unions to adapt apprenticeship programs to train new green job skill
        sets.
    Simultaneously meet the emerging needs of industry; train and support workers;
        and create good, family-supporting jobs.
    Develop job skills commensurate with the requirements of the sector
    Focus on job quality – compensation, job satisfaction, opportunities for
        advancement – not just job quantity
    Develop community college programs for skilled labor in:
            o Solar installation
            o Wind tower maintenance
            o Biomass production
            o Ethanol plant production & operation labor

Develop incentives to attract the workforce of the future to more rural areas. Programs
that support spouse careers, education opportunities (child and adult learning), quality of
life, and community infrastructure are essential.



.




Related Policies/Programs in Place
   University of Illinois curriculum
   Milwaukee-based Wisconsin Regional Training Partnership (WRTP) and Jobs With a
    Future (JWF) of South Central Wisconsin. In addition, COWS spearheaded the
    Milwaukee Jobs Initiative (1997-2004), which provided training, mentoring, and
    other services to help low-income, central city residents connect to family-supporting
    jobs.
   Advanced Manufacturing Project, a research consortium that investigates how
    suppliers of large equipment producers can stay competitive and preserve quality
    manufacturing jobs in the upper Midwest.
   AgBioworks is an initiative of Memphis Bioworks Foundation and BioDimensions
    dedicated to developing new agricultural technologies and processing.
    www.agbioworks.org
   The 21st Century Jobs Fund is a $2 billion, ten-year initiative created to accelerate the
    diversification of Michigan‘s economy by increasing the amount of capital available
    to Michigan companies. Alternative energy is one of the targeted sectors.
   Agriculture Processing Renaissance Zones (Michigan) – areas of no-tax for
    agriculture and forestry-related businesses including those producing biomass for
    fuels or energy.
   Iowa, Ohio and other Midwestern states have a number of programs and initiatives to
    attract jobs in the bioeconomy sector.
   Center on Wisconsin Strategy (COWS) at www.cows.org. This national policy center
    and field laboratory for high-road economic development promotes a competitive
    market economy of shared prosperity, environmental sustainability, and capable
    democratic government. Their publications contain numerous recommendations for
    attracting jobs and employees with the skills to match.

Type(s) of GHG Reductions
Primarily CO2 through the creation of jobs in the bioeconomy and energy efficiency
sector.

Estimated GHG Reductions and Net Costs or Cost Savings
Because of the far-reaching and diverse options recommended, it was not possible to
neither quantify the potential reductions in greenhouse gases nor determine a cumulative
cost for specific actions by state or region.

Key Uncertainties
The ability of states to redistribute resources to create recommended positions in the
short-term is uncertain.

Additional Benefits and Costs
All efforts to improve community prosperity through job creation, retention and
enhancing the skills of the workforce serve to attract more industry and services,
especially when quality of life, environment and work are emphasized.
Feasibility Issues
None cited.

Status of Group Approval
The group has approved these recommendations conceptually. Final approval pending.

Level of Group Support
TBD
                              BT-7: Bioenergy Incentives



Policy Description
Broaden existing bioenergy incentives and create new incentives that promote many uses
of biomass, including not only a range of different liquid fuels, but also natural gas,
methane, heat and electricity.

Policies can be developed to help overcome barriers for biomass energy development or
conversely, existing barriers can be removed. Institutional and market barriers include
price distortions, failure of the market to value the public benefits of biomass removal
and use, the social cost of fossil fuel technologies, inadequate information, institutional
barriers to grid interconnection, high transaction costs because of small projects, high
financing costs because of lender unfamiliarity and perceived risk. These can be
overcome through a suite of financial and regulatory redresses as well as through
information and public education campaigns.



Policy Design
Financial obstacles can be addressed through property tax exemptions, exclusions, and
credits; personal income tax credits or deductions to cover the expense of purchasing and
installing bioenergy equipment; loan programs to aid in financing the purchase of
biomass harvest equipment and storage; incentivizing centralized facilities; long term
contracting; performance-based contracting and grant programs designed for research and
development or to help a project achieve commercialization.

Additional obstacles such as zoning and siting restrictions can be re-designed to enhance
biomass production and conversion facilities location opportunities. Improved access to
the grid and existing infrastructure can facilitate this form of renewable energy
development.

Pricing and metering strategies can provide price signals and revenue streams to support
investment in and optimal operations of CHP and other bioenergy systems. Net metering
is a policy that allows owners of grid-connected distributed generation (generating units
on the customer side of the meter, often limited to some maximum kW level) that
generate excess electricity to sell it back to the grid, effectively ―turning the meter
backward.‖

Net metering provides several incentives for renewable DG by reducing transaction costs
(e.g., no need to negotiate contracts for the sale of electricity back to the utility) and
increasing revenue by setting compensation at retail electricity rates rather than at utility
avoided costs.

In addition to net metering, pricing strategies of relevance to CHP and distributed
bioenergy systems can include ―time-of-use‖ rates. These are fixed rates for different
times of the day and/or for different seasons that reflect the time-varying value of
electricity.
Consider ways to award early innovators who are undertaking process changes that may
not reap rewards in the short-term, but are the right thing to do environmentally, These
‗rewards‘ could include outright incentives, but also potential recognition for early action
in future low-carbon fuel standard and/or cap and trade program.
.

Public education is critical and deserves greater emphasis in the policy template.


Goals:

Review policy options 1 through 5 for specific incentives for bioenergy production and
use.

Timing:


Parties Involved:

Other: None cited.

Implementation Mechanisms
Should the following be assigned to a specific policy option such as BT-5, BT-1?

Incentives for promoting biomass (BT-5.1)
     Incentivize co-ops for aggregating biomass – help them to purchase a unit that
       would pelletize

Work with loggers to get them to aggregate other types of biomass (BT– 5.1, 5.2)
   Chip slash and other non-marketable debris
   Transport chips to an energy producer such as an electric plant or combined heat
      and power system (CHP)
   Or, pelletize chips for use in residential or commercial heating

Tax incentives for the development of renewable energy plants – (BT- 1.1)
    No local property taxes or any state property taxes – for new facilities – for up to
       10 – 15 years.
    Tax incentives for retrofitting other types of plants for becoming renewable
       energy plants
    Possibly provide incentives for the amount produced & for the length of time they
       commit to being in an area

Create a Renewable Portfolio Standard to encourage market (BT 1.1)
    Mandate –
    Example ―Renewafuel‖ – owned by a mining corp. – developed dense fuel cubes
       made from feedstocks – using as a partial replacement for coal in large industrial
       furnaces – municipalities, universities, etc…
    Develop transportation incentives for getting biomass to factories
Related Policies/Programs in Place
These could include Recent Actions in XX Jurisdiction:
 Use brief paragraphs.
   Or one or 2 lines.
   Add bullets as needed.
Type(s) of GHG Reductions
For example: Primarily CO2.

Estimated GHG Reductions and Net Costs or Cost Savings

Data Sources:
List, if possible provide URL..

Quantification Methods:
Briefly describe in a paragraph/several sentences. Okay to refer to information supplied
above.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
    1. Use numerical listing.
    2. Keep the items brief – 1 or 2 sentences.
    3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD
                         BT-8: Next Generation Regulations



Policy Description
New technologies can deliver environmental benefits, but often do not fit neatly into
existing regulatory schemes. This can create challenges for regulatory agencies and
industry. Collaboration is needed to develop permitting rules for advanced technologies,
share information about the environmental impact of various advanced technologies,
provide regulatory exemptions for novel demonstrations to allow experimentation, and
promote innovative regulatory strategies that seek to reward projects with good overall
environmental characteristics.

This needs emphasis in the policy template narrative and MGA roadmap, but the
recommendations and work can be left to the relevant MGA committee of agency staff
addressing this.

Additional proposed regulations from other policy options can be aggregated here.


Policy Design
Goals: See list of overarching goals prior to this section.


Timing:


Parties Involved:

Other: None cited.

Implementation Mechanisms


Related Policies/Programs in Place
These could include Recent Actions in XX Jurisdiction:
 Use brief paragraphs.
   Or one or 2 lines.
   Add bullets as needed.
Type(s) of GHG Reductions
For example: Primarily CO2.
Estimated GHG Reductions and Net Costs or Cost Savings
Data Sources:
List, if possible provide URL..

Quantification Methods:
Briefly describe in a paragraph/several sentences. Okay to refer to information supplied
above.


Key Assumptions: List/describe

Key Uncertainties
Describe or say None cited.

Additional Benefits and Costs
   1. Use numerical listing.
   2. Keep the items brief – 1 or 2 sentences.
   3. Include social /non-quantifiable and indirect benefits
[Okay to say if these will be analyzed at a later date.]

Feasibility Issues
Describe or say if None cited.

Status of Group Approval
Pending

Level of Group Support
TBD

Barriers to Consensus
TBD

				
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