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ELPC Commends Senate Agriculture Committee Support of Homegrown Energy

WASHINGTON – The Senate Agriculture Committee took an important step to support America’s farmers, renewable homegrown energy, rural development and national security by funding core energy programs through a Farm Bill amendment passed today.

“We commend Chairwoman Sen. Debbie Stabenow (D-Mich.) and the bipartisan group of 11 Senators who supported a bipartisan amendment supporting mandatory funding for programs that reduce dependence on polluting fossil fuels and help farmers cut energy costs and produce innovative renewable energy for America,” said Andy Olsen, Senior Policy Advocate with the Environmental Law & Policy Center.

“The state of the economy and our continuing energy challenges underscore the need for programs like the REAP (Rural Energy for America Program) and  BCAP (Biomass Crop Assistance Program) which generate rural development and provide a safety net to farmers,” Olsen said.

“We thank the energy title supporters, Senators Kent Conrad (D-N.D.), Richard Lugar (R-Ind.), Tom Harkin (D-Iowa), Ben Nelson (D-Neb.), Michael Bennet (D-Colo.), Sherrod Brown (D-Ohio), Amy Klobuchar (D-Minn.), John Thune (R-S.D.), Bob Casey (D-Pa.), John Hoeven (R-N.D.), and Charles Grassley (R-Iowa) for their support of an Energy Title amendment that provides mandatory funding of these core energy programs,” Olsen added.

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The Environmental Law & Policy Center is the Midwest’s leading environmental legal advocacy and eco-business innovation organization.

The Senate Agriculture Committee draft would inflict steep cuts to programs, including REAP (Rural Energy for America Program), BCAP (Biomass Crop Assistance Program), and Biorefinery Assistance.

These programs have pushed innovative energy development and provide a safety net for farmers. (Click here to learn about the accomplishments of the 2002 and 2008 Energy Title.)

Without mandatory funding for these programs, they will wither, rolling back advances in clean, homegrown energy and placing rural jobs in peril. Contact the committee to demand mandatory funding of the energy title.

In 2011, the Rural Energy for America Program (REAP), just one program impacted by proposed cuts:

• Created or saved 7,000 jobs
• Cut greenhouse gases by almost 2 million metric tons
• Saved the equivalent of over 2 billion kilowatt-hours of electricity
• Generated $456 million in investments in our communities

“We thank the Senators for including Energy Title programs in the new Farm Bill in the difficult climate they face, especially the leadership from Senators Stabenow, Lugar and Harkin.  We also hope the Agriculture Committee can restore mandatory funding to these core clean energy programs that mean so much to our rural communities and to our nation,” said Andy Olsen, senior policy advocate with the Environmental Law & Policy Center.

WASHINGTON, D.C. – More than 100 diverse groups representing agriculture, energy, rural development and conservation called on Congress today to renew and fund core energy programs in the Farm Bill that push forward clean, homegrown energy. These programs advance energy efficiency, wind, solar, new energy crops, biomass energy and biobased products.

In a joint letter to the leaders of the House and Senate Agriculture Committees, signers noted, “These important and growing industries all benefit agriculture and forestry and are poised to make huge contributions to our economic, environmental and national security in the coming years, provided that we maintain stable policies that support clean energy.”

The energy programs are administered by the USDA and have made a number of accomplishments since the first Energy Title was created in the 2002 Farm Bill:

* The Rural Energy for America Program (REAP) has supported nearly 8,000 energy efficiency and renewable energy projects across the nation in varying agricultural sectors.

* The Biomass Crop Assistance Program has assisted farmers in developing homegrown energy crops that support farms and supply needed energy sources

* Biofuel advancements have accelerated through support from the Biorefinery Assistance Program.

“This letter arrives at the Agriculture Committees as rising gasoline prices remind America that our long-term energy challenges to our nation’s well-being require long-term commitment,” said Andy Olsen, ELPC Senior Policy Advocate. “Polls show the American people believe the Farm Bill should support clean energy and we know Congress can pass a Farm Bill that reflects the will of the American people.”

Download the letter.

“We commend the experts and Senators who took a stand for homegrown clean energy today,” says Andy Olsen, Senior Policy Advocate at the Environmental Law & Policy Center (ELPC), a long-time champion of the Farm Bill’s clean energy programs. “Through these programs, America has made unprecedented gains in rural renewable energy and energy efficiency. Congress and the White House should continue this forward momentum.”

Steve Flick, one of the nation’s farm energy entrepreneurs, called for Congressional action to renew and fully fund core Farm Bill clean energy programs, such as the Rural Energy for America Program (REAP), Biomass Crop Assistance Program (BCAP) and the Biorefinery Assistance Program. “America’s farmers, ranchers and rural residents can have a bright future ahead of them with the right incentives,” Flick says. “Renewable energy is the future of rural America.”

Bennie Hutchins of Mississippi provided numerous examples of how REAP has helped agricultural producers and rural small businesses save money and produce income across the South. He shared ELPC analysis showing that REAP produces jobs at a greater than average rate.

“Farm Bill clean energy programs have been an unprecedented success. They have helped farmers reduce their energy bills and energy waste through energy efficiency and accelerated the introduction of modern clean energy technologies into the marketplace,” Olsen says. “Congress and the White House should continue this momentum by renewing and fully funding core Farm Bill clean energy programs.”

Of all the Farm Bill clean energy programs, the President’s budget only recommends funding the Rural Energy for America Program, REAP, at $4.6 million in 2013. This funding level is a cut of 82% from 2012 funding levels. The President restricts this funding to only loan guarantees, which have seen very low demand over the years. No other energy title programs would be funded in 2013 under the President’s proposal. It is not known at this time if the White House supports continuation of the Energy Title in the next Farm Bill.

While the President’s budget proposes to cut tax breaks for fossil fuel extraction in the next decade to spend more for conservation and alternate energy, apparently none of those funds would be used for agricultural clean energy programs.

This proposal is in stark contrast to the call in the President’s State of the Union  pursue an energy strategy of “all-out, all-of-the-above.” Clearly, his approach excludes further progress on Farm Bill clean energy efforts.

The clean energy programs of the Farm Bill have made unprecedented progress in developing and accelerating a broad range of clean energy technologies. Farmers and rural small businesses in every state and many agricultural sectors have benefited while the programs stimulate private investment, technology investment and jobs. Hopefully, Congress will reject this part of the President’s budget request and maintain the forward momentum for modern farm energy technologies.

For more information:

• Energy and Environmental Study Institute, Fact Sheet: Obama Administration FY 2013 Budget Proposal: Sustainable Energy and Transportation
• Main page for President’s 2013 budget documents.

Despite the success and popularity of the program, a Congressional “Conference Committee” is now deliberating just how drastically to cut REAP funding for 2012. “REAP is a successful clean energy program, generating jobs and economic development in rural communities while cutting pollution,” said Andy Olsen, Senior Policy Advocate for the Environmental Law & Policy Center. “Congress can create jobs and grow our economy, by continuing to renew and robustly REAP for 2012 and beyond.”

The greatest number of awards went to solar energy, for both solar electric and solar thermal (heat). For the entire year, REAP funded 478 solar projects in 44 states. Michigan fared the best with 48 awards followed by New York (39), Pennsylvania (36), Tennessee (34) and California (29). Farmers have always harvested the sun for growing food and fiber and now more are embracing solar energy for power and heat.

For the year 2011, REAP funded 55 wind power awards, with Iowa and New York leading with seven each. Wind power has flourished under REAP for both small and utility-scale technologies, but fell off significantly this year, from 164 projects in 2010.

Geothermal projects use the energy of the earth for efficient heating and cooling, saving money while cutting pollution. Fifty-nine awards sparked new project construction across the country. Leading states include Minnesota (13), Iowa (11) and Michigan (7).

Small hydroelectric projects were included in REAP in the 2008 Farm Bill revisions and new awards were made for a number of projects in the West (Oregon, Nevada, Idaho) and the southeast (Georgia and North Carolina).

The Rural Energy for America Program (REAP) is a Farm Bill program that enables farmers and rural small businesses to install diverse renewable energy or energy efficiency technologies to cut costs and increase profits. REAP provides loan guarantees and grants for up to 25% of the project cost, leveraging private sector investment and creating jobs. REAP is up for renewal in the new Farm Bill now being debated by Congress.

The Environmental Law & Policy Center (ELPC) has advocated for REAP from the program’s inception and has helped expand the program to benefit rural communities across the nation. ELPC is working to protect REAP funding and promote job creation and clean energy for rural communities.

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(ALERT: While REFRESH is a positive step in the longer term, an immediate priority is next year’s budget. Please add your voice now to those opposing unfair cuts to REAP and BCAP. Time is of the essence – Congress may take further action very soon. Thank you.)

REFRESH provides nearly $1.3 billion in mandatory appropriations for five different clean energy programs with significant additional discretionary funding authorizations.  In particular, REFRESH includes annual funding of $70 million for the REAP program and an additional $80 million annually in discretionary funds.  The legislation also extends REAP to assist our nation’s rural schools with energy efficiency programs.

The legislation also supports the development of energy crops with the BCAP program.  REFRESH proposes to fund BCAP at $55 million dollars a year, with an additional $150 million a year in discretionary funding, while working to improve the program in several important respects. REFRESH includes complementary loan guarantee financing for biorefineries by continuing the Biorefinery Assistance Program for two more years.

REFRESH also adds a new Rural Energy Savings Program for rural electric cooperatives and others to help their customers save energy and money. REFRESH also extends the Biobased markets program.

Without reserving comment on the merits of the entire proposal, we applaud Senator Lugar and Representative Stutzman for recognizing that America’s the great potential for renewable energy from the heartland.  REFRESH affirms the value of energy for rural America, and the win-win of clean energy for rural economic development, energy security and environmental quality.

The Senate Appropriations Committee slashed funding for the Rural Energy for America Program (REAP) in the Agriculture Appropriations Bill for FY2012. The Committee reduced overall funding from $75 million in FY2011 to $38.5 million in FY2012. REAP funding was already reduced in 2011 by 25% as the program continues to bear a disproportionate share of budget cuts.

In his introductory remarks, ranking member Senator Roy Blunt (R-MO) emphasized that most Farm Bill programs were reduced by only 5%. In stark contrast, The Rural Energy for America Program (REAP) was reduced by nearly 50% and the Bioenergy Program for Advanced Biofuels to $75 million, a cut of nearly 30%.

REAP is a popular and oversubscribed program that has funded over 7,600 farm energy projects since 2003, directly benefitting farmers in all agricultural sectors and every state and by making renewable energy and energy efficiency projects more affordable.  Because the program provides grants to cover 25% of the cost, the $36.5 million dollars cut from REAP jeopardizes at least $146 million of overall private and public investment – and jobs — in rural America.

“Disproportionate cuts to farm energy will stall efforts to create homegrown clean energy, new farm income and a healthier environment,” said Andy Olsen, Senior Policy Advocate for Environmental Law & Policy Center. “We will work to restore this funding as the process goes forward.”

The Senate Appropriations Committee met late Wednesday and passed an austere Agriculture Appropriations Bill for FY2012, starting this October 1. Thankfully, the Senate Appropriations Committee wisely preserved funding for the Biomass Crop Assistance Program, an innovative program to develop new energy sources from sustainably grown crops.  The committee reduced funding for the Bioenergy Program for Advanced Biofuels to $75 million, a cut of nearly 30%.

ELPC and the Environmental and Energy Study Institute (EESI) gathered experts on agriculture and clean energy development in Washington on Tuesday, July 19 to address the Rural Energy for America Program (REAP) and other Farm Bill energy programs. Speaking to over 150 staffers and stakeholders in separate House and Senate briefings, they explained the broad benefits of these programs for farmers, businesses, economic development and national energy security policy.

Panelists were:

• Bruce Knight, Dairy Advisor for Strategic Conservation Solutions, LLC and former Chief of the Natural Resources Conservation Service at the USDA under President Bush. Download presentation (PDF).
• Bennie Hutchins, Principal, Ag Energy Resources, Mississippi. Download presentation (PDF).
• Bill Midcap, Farmer and Rural Development Specialist, Rocky Mountain Farmers Union, Colorado. Download presentation (PDF).
• Andy Olsen, ELPC Senior Policy Advocate. Download presentation (PDF).

Other speakers at the briefings included EESI Executive Director Carol Werner and ELPC Director of Federal Relations Karen Torrent.

Energy Title Overview

The first panelist, Andy Olsen, provided a high level overview of how the Farm Bill is accelerating energy savings and clean energy production, supporting rural economic development in the process. Olsen emphasized that the private sector has responded positively to these programs with ingenuity and the American “can do” spirit. For example:

• Advanced biofuels production – The USDA has moved quickly with the Biorefinery Assistance Program, providing loan guarantee financing to build cellulosic ethanol, community digester, and other biofuels/biopower facilities. USDA is accelerating approval of these guarantees and plants are now under construction in several states, with a concentration in the Southeast.
• Energy crops – Although the Biomass Crop Assistance Program got off to a rocky start in 2009, the USDA made several key changes and the 2011 program is now back on track. USDA refocused BCAP on energy crop development and now more than 95% of all funding is for establishing and growing energy crops. BCAP should be judged on the basis of the 2011 program.

Focus on the Rural Energy for America Program

Olsen and the other speakers also highlighted how the Rural Energy for America Program (REAP) serves every agricultural sector in every state, sparking private sector investment and innovation and retaining and creating much needed jobs in rural America.  REAP now has helped to finance more than 6,000 projects across the country – see map below.

Bennie Hutchins

Bennie described the growing popularity and use of REAP in the South, focusing on the strong benefits to poultry producers in slashing energy costs and producing renewable energy. REAP also has helped fund energy projects in aquaculture and forestry. Hutchins emphasized the great benefits for rural small businesses, such as “Mom and Pop” grocers who can use REAP to cut energy costs.

Bruce Knight

Bruce described how consumer demand has led the dairy industry to shift towards more sustainable practices through the whole dairy supply chain. Sustainability is “no longer a philosophical movement,” he said, “it’s now a consumer response.” Knight added that the dairy industry has been very responsive to this consumer demand, pursuing a broad and aggressive program to cut energy use and produce renewable energy and other coproducts from cow manure.  REAP is key to many of these efforts.

Bill Midcap

Bill explained that electric cooperatives are member owned and many of them offer great opportunity for locally-owned projects. He showed how many rural electric cooperatives have used REAP in innovative ways, such as: using the energy audit and renewable energy development assistance program to identify new projects; using feasibility study funding for their own coop-owned projects; grants to build their own systems; and combining multiple projects on customer properties under one master grant. He stressed that “REAP plus rural electric cooperatives can turn electric consumers into electric producers.”

Video

Click here to view the embedded video.