Download Capture and combustion

Minnesota’s agriculture in a carbon constrained economy
CAPTURE AND COMBUSTION
Bjorn Gangeness
November 27, 2007
Climate Change in Context
 Nearly inarguable evidence showing human
influence in raising average global temps
 The challenge of what to do and how
 Solutions coming from different levels of
government and citizen participation
 Different sectors play different roles - energy
generation to consumption to agricultural
production
Minnesota’s emissions
reduction goals
 80% reduced carbon emissions below 2005
levels in 2050, 30% in 2025 (eq. to 45.3MMT)
 Reductions could come from
 efficiencies,
 reduced energy use,
 carbon offsets,
 geologic capture and storage,
 or terrestrial capture and storage
Carbon and Agriculture
Source:
bp.com
Carbon and Agriculture
 Large agricultural industry in Minnesota
overwhelmingly focused on corn and soy
 New initiatives that will make perennial
biofuel crops more attractive
 Governor’s NextGen Energy Initiative
 Reinvest in Minnesota – Clean Energy
New Crop Initiatives and
Carbon
 The problem is the extent in considering
carbon sequestration in development
 No mention of carbon stock goals
 No anticipation of carbon cap and trade system
 If addressed, perennial biofuels may develop
more securely in an unsure marketplace
Reinvest in MN – Clean Energy
 $46 million requested appropriation for 2008
 $40 M for bioenergy crop easements
 $6 M for administration
 13,000 acres expected easements for a
maximum 20 year payment of $3077/acre
 Recognition of potential to work with other
initiatives within the Federal Farm Bill
 Tiered system of payments depending on
type of practice implemented
Example of Tiered System
Tiers
modeled on
Conservation
Security
Program
• Tier I ($1500/acre)
• Switchgrass
• Tier II ($2000/acre)
• At least 4 native prairie species
• Tier III ($3000/acre)
• At least 4 native prairie species
and permanent easement
status
Relevant Criteria
Economic
Efficiency
•($/MTCO2e)
•Viability
Ecological
Integrity
• Wildlife habitat
• Water Quality
• Biodiversity
Simplicity
• Manageable
• Understandable
• Complementary
Alternatives
 No action – simply allow biofuels incentives
to move forward on the current path
 Integrate carbon credit system into the tiered
payment structure based on BMPs
 Set carbon stock increase goals for each tier
Full Appropriation Assumed ($46M in 2008)
No Action Alternative
 Economic Efficiency
 13000 acre goal but likely higher
 1.6 MTCO2e/acre/yr
21,000 MT/yr or ~
420,000 MT over 20 yrs ($95/MT)
 Ecological Integrity
 Monoculture
 Perennial is good for WQ
 Habitat is better than row-crop
 Simplicity
 Monoculture is easier to harvest, plant, manage
Carbon Credit Integration
Changes
to Tiers
• Tier I - Switchgrass (CCX 1 MT/acreyr, $2.50 or $37.45 on ECFI 2010)
• Tier II - At least 4 native prairie
species (CCX 1 MT/acre-yr, $2.50 or
$37.45 on ECFI 2010)
• Tier III - At least 4 native prairie
species and permanent easement
status (CCX 1 MT/acre-yr, $2.50 or
$37.45 on ECFI 2010)
Carbon Credit Integration
 Addresses benefits of credit trading in each tier
 No control over the carbon credit market so no
price guarantees
 Carbon markets are still voluntary, though a
national system could change that
Carbon Credit Integration
 Economic Efficiency
 Minimal administrative fees to integrate and
promote seeking of carbon credits for practices
 Stacked payments make incentives more
attractive
 Ecological integrity
 Grass species are not distinguished for in CCX
 Simplicity
 More complicated than No action, but stacked
payments outweigh administrative consequences
Goal of Increased Carbon
Stocks
Changes
to Tiers
• Tier I - Switchgrass (CCX 1 MT/acreyr, $2.50 or $37.45 on ECFI 2010)
• Tier II - At least 4 native prairie
species and wetland restoration
(4.4 MT/acre-yr in wetlands)
• Tier III - At least 4 native prairie
species, short rotation woody crops
and permanent easement status
(7MT/acre-yr in SRWC)
Goals of Increased Carbon
Stocks
 Higher sequestration goals per tier with
mixed practices
 Economic Efficiency
 More diversified fuelstocks, less market sensitivity
 Higher payments for higher sequestration rates
 Ecological Integrity
 Wetlands and SRWCs create more diverse habitat
than simple grass species
 Simplicity
 The most complicated option
Recommendations
 Train technical assistance providers in carbon
markets
 Follow the progress of the development of
Midwest GHG Reduction Accord
 Incorporate data from NextGen cellulosic
pilot projects
 Create flexibility within the RIM-CE structure
that allows for more fluid transitions to
alternative crops (among/between species)