Mark Jenner

October 25, 2012 | General

Biomass Energy Outlook: Rethinking Biomass Supply Economics

Mark Jenner

Mark Jenner
BioCycle October 2012, Vol. 53, No. 10, p. 53

After high school, I studied crop and soil science and became a young, passionate advocate of holistic, organic crop production. Since then I have spent 35 years working at every level and kind of production agriculture. Today, the only thing I am sincerely passionate about professionally is system efficiency. It works in sustainable holistic systems as well as large-scale commercial systems. In either case the earth’s resources are finite and the human population continues to grow. To succeed, we all have to produce more with fewer resources.
A lesson I learned early on, like most BioCycle readers, is that it isn’t enough to identify the things that aren’t working. It is important to identify the solutions and implement them. My currency of choice is renewable biomass, particularly that related to production agriculture. In April, I began working for the agricultural commodity forecasting company, World Agricultural Economics and Environmental Services, as an environmental economist. My role is to create datasets and equations that reflect the interface between agriculture and the environment.
It is very exciting, in part because more agricultural and environmental data exist today than ever before. In addition our farming systems get more sophisticated each year. One of the challenges of analyzing rapidly changing industries like agriculture, and composting and bioenergy, is that historical data categories may not have changed for 100 years, but the underlying meaning of an acre of land, a bushel of corn or a market hog are changing all the time. Back in the 1960s and 1970s, a bushel of corn weighed 56 pounds and was good for feeding hogs. Today a bushel of corn has environmental, energy and even industrial product attributes.

New Available Technology Data

One of the new innovations in USDA production data is technology information on intensive rotational grazing. This pasture management system efficiently recycles nutrients, enhances water quality and crop diversity, and produces more beef per acre than conventional grazing systems. Twenty years ago, it was an experimental technology. Now, the 2007 Census of Agriculture indicates that intensive rotational grazing has been adopted by over 40 percent of cattle farms and 25 percent of farms that have pastureland. Efficient cattle feeding lowers enteric methane production, one of the largest sources of agricultural greenhouse gas production.
Until recently, public data on manure characteristics was based on manure that had been collected from a handful of animals in the 1970s. The annual gains in livestock feeding efficiency, growing more meat from less feed, are well documented. But manure production quantities and quality were always fixed at less efficient levels that were established 30 to 40 years ago. In 2005, the American Society of Agricultural Engineers released new manure characteristics that include feed–based information developed from decades of research on feeding trials in livestock. It isn’t perfect, but provides a better scientific foundation for policy development.

Adjusting Historical Farm Data

Farming systems keep evolving and some technology changes go unnoticed. An example is in the way we treat pasture and hay crops. A pasture may contain the same plant species as a related hay crop, but a grazed crop is actually harvested using the bioenergy of the grazing animal, while a hay crop is mechanically harvested. Both systems are harvested, but the product harvested and eaten by grazing animals doesn’t get measured or sold like hay production does. These comparisons are important when examining the carbon and energy balances of various farming systems.
One common term that has multiple inherent meanings, but gets treated economically as though there is only one, is the term ‘output.’ Conventional economics deals primarily with commodities — normal goods measured by the basic kind of economics we learn in school. When folks really want something and can’t find enough of it, the price goes up. Commodity demand establishes the relationship between price and quantity. In today’s world, however, farm outputs fall into at least four economic categories: commodities, residuals, wastes and value-added. Residuals and wastes fall under the umbrella of ‘by-product’ economics.
By-product economics do not work the same way as commodities. The amount of by-product production is determined by the primary commodity, not by the price of the by-product. In other words, if the value of chicken manure goes up, that change by itself will not cause more chickens to be grown.
Residuals and wastes are by-products that differ primarily in value. Residuals are by-products with a positive value. Wastes are by-products with a negative value. Chicken manure is a residual with value if someone wants it, and is an unwanted waste if it has a negative value.
The last kind of economic output is a value-added output. The most notable characteristic of a value-added commodity is that it has no value assigned directly to it. It is an output that gets reused as an input into a second process or enterprise. The initial output value is deferred and later realized by the sale of the output of the second process. Corn and hay that are grown and fed to livestock on the same farm are crop outputs that never receive a market price. Farm anaerobic digestion and composting also take a farm output, manure, and further process it into other products of value. Value-added outputs also have significant benefits in conducting carbon and energy balances.
We are moving to a new world of comprehensive data. The last 20 years of farm environmental interactions have been based on limited quantitative data. Better use of newly available data as well as careful reconstruction of historical data will provide more accurate, robust assessments of the economic and environmental impacts from farming and biomass production.
Mark Jenner, PhD; World Agricultural Economic and Environmental Services (WAEES), California Biomass Collaborative, and Biomass Rules, LLC (

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