Wind Development in Minnesota: Policy and Economics

The growth of wind power as an aspect of Minnesota’s portfolio of electricity has been propelled to its current level by policy initiatives at both the federal and state levels. Existing statutes establish requirements for further expansion of wind energy in this state in the years to come. Locally, production economics exert their influence as wind speed and duration are translated to capacity factor, which reveals the amount of power that can be generated at a particular site. After the flow resource is thus quantified, comes the calculus of economic viability. This consists of determining the capital and operating costs and eligibility for loans and grants as well as the negotiations of wind rights, easements, and power purchase agreements. To date, policy initiatives have been directed toward the production, or generation side of this variable flow resource. Entrepreneurs and lawyers have become more skillful at organizing business forms that can effectively bring together partners capable of utilizing the substantial tax benefits available through the federal Production Tax Credit (PTC) as well as attractive state-sponsored incentives and tariffs offered by utilities. The variable nature of electrical power capacity from wind has been problematic for utilities, which try to meet the variable loads required by the summed demand of their customers. In Minnesota, peak power demands occur in summer months when wind power is the lowest. In addition to seasonal demands, daily and weekly patterns must be accommodated by utilities serving the markets for electricity. By developing and using an investment model, it is possible to understand investor motivations driving the growth of wind energy in this state and the country. Net present values (NPV) and internal rates of return (IRR) are calculated over the life of power production projects conforming to various conditions such as wind capacity factor, the federal Production Tax Credit (PTC), state incentive plans for community-based energy providers, federal grant and loan programs, as well as emerging opportunities to sell “green tags” for renewable power generation. The numerous incentives provided for windpower development on the generation side highlight the difficulties of providing sufficient transmission capacity for to carry this power from the often remote areas where generated to load centers. Equivalent incentives deployed with similar imagination are needed to enhance investment in a transmission system capable of carrying increasing volumes of wind and other renewable sources of electricity.Resource /Energy Economics and Policy,

BIODIESEL: A POLICY CHOICE FOR MINNESOTA

Resource /Energy Economics and Policy,

Economic Impacts of Establishing Short Rotation Woody Crops to Support Energy Production in Minnesota

The utilization of short rotation woody crops (SRWC) to produce wood on marginal crop and pasture land could greatly enhance the production of wood for various uses in Minnesota with utilization for energy being of current interest. SRWC involves the more intensive application of inputs on more valuable land than naturally regenerated forests that currently supply the bulk of the forest products industry in Minnesota. Breeding efforts to improve productivity and disease resistance in hybrid poplar species are making the technology of SRWC competitive with agricultural uses of marginal land. This study models the economic impact of a potential shift in use of the land resource by replacing production of hay and pasture that provides feed for cow-calf beef operations in northwest and west central Minnesota with SRWC. Regional economic impacts of such a shift are measured with established input-output techniques, using the software tool IMPLAN. To complete this analysis, the magnitudes and sectors of expenditures needed to produce either beef calves or hybrid poplar plantations were compared using farm records and hybrid poplar budgets. Construction of a $175 million energy conversion facility capable of making 44 million gallons of ethanol and 7.6 million gallons of mixed alcohols by catalytic means following gasification would result in creation of 2,412 jobs during the construction period, with$158 million in value-added (mainly employee compensation and business taxes). Operation of the facility after the end of construction, if supported by 200,000 acres of hybrid poplar production, would not change the number of jobs very much compared with using the land for cow-calf operations. However, the SRWC-related jobs would likely be at higher average salary levels and business tax collections would be higher, for a value-added increase of $80 million annually. In addition to greater wood supplies to support the forest products industry, logging pressures may be reduced on public forest land as a consequence of greater deployment of technology and methods that can result in production per acre that is eight to ten-fold greater than naturally regenerated forests.Hybrid Poplar, SRWC, IMPLAN, economics, energy, ethanol, OSB, Resource /Energy Economics and Policy,

FACTORS ASSOCIATED WITH SUCCESS OF FUEL ETHANOL PRODUCERS

Replaced with revised version of paper 08/24/04.Resource /Energy Economics and Policy,

BIOMASS FOR ELECTRICITY AND PROCESS HEAT AT ETHANOL PLANTS

Published in: Applied Engineering in Agriculture, Vol. 22(5): 723-728Biomass, Process heat, Ethanol production, Electricity, Combined heat and power, Resource /Energy Economics and Policy,

ECONOMICS OF BIOMASS GASIFICATION/COMBUSTION AT FUEL ETHANOL PLANTS

Published in Applied Engineering in Agriculture, Vol. 25(3): 391‐400Ethanol, Biomass, Economics, CHP, Emissions, Process heat, Electricity production, Resource /Energy Economics and Policy,

Energy and Chemicals from Native Grasses: Production, Transportation and Processing Technologies Considered in the Northern Great Plains

Production of biomass from native prairie species offers the opportunity to produce energy and chemicals while providing substantial ecological services in the Northern Great Plains. This paper analyzes the application of rapid pyrolysis to produce bio-oil, which has the potential for use as a low-grade fuel oil or as a source for extraction of valuable chemicals. Yields of bio-oil, the quantities of extractable chemicals, and chemical prices drive the economics of this concept, which has a more extensive track record utilizing wood chips. A spreadsheet model was developed to determine gross margins available to defray costs to extract and refine such chemical products as hydroxyacetaldehyde, phenol, formic acid, acetic acid and various resins. Although efforts to hydrolyze anhydroglucose were successful, efforts to produce ethanol from the resulting six-carbon sugars were unsuccessful in a related trial. To understand the overall project economics, it was necessary to consider the availability and productivity of lands in the Northern Great Plains that can provide low cost native prairie grasses including Big Bluestem and Switchgrass. Production economics and transportation economics were analyzed to determine the costs of native prairie grasses delivered to a plant capable of pyrolyzing the biomass. Competing technologies that could also use native prairie grasses are considered as well as policy alternatives important for production of energy and chemicals from native prairie grasses.prairie grasses, pyrolysis, economics, chemicals, energy, bio-oil, Resource /Energy Economics and Policy,

INTEGRATING BIOMASS TO PRODUCE HEAT AND POWER AT ETHANOL PLANTS

Published in: Applied Engineering in Agriculture, Vol. 25(2): 227‐244Biomass, Renewable, Sustainable, Model, Gasification, Combustion, Emissions, Ethanol production, Combined heat and power, Resource /Energy Economics and Policy,

A Corn Stover Supply Logistics System

Published in Applied Engineering in Agriculture, Vol. 26(3): 455‐461, 2010. American Society of Agricultural and Biological EngineersCorn stover, Economics, GHG emission, Logistics, Roll press compaction, Tub grinding, Agribusiness, Crop Production/Industries,

Prenatal Care and Infant Mortality in Nevada

The U.S. outspends all other industrial countries on health care, and yet Americans hardly enjoy better health (Gorman 2010). An American baby born in 2006 can expect to live 78 years – two years less than a baby born across the Canadian border. The U.S. ranks 28th in infant mortality out of the 30 major industrial countries (Gorman 2010). A large part of the gap in infant mortality can be traced to high infant death rates in certain populations, particularly African-Americans who make up about 13% of the total population. In 2005, infant mortality for non-Hispanic blacks in the U.S. ran to 13.6 deaths per 1,000 live births compared with 5.76 deaths per 1,000 live births for non-Hispanic whites. Such disparities reflect differences in education, environment, and socioeconomic status – factors notoriously difficult to mitigate (Gorman, 2010, p. 34)