Economic Impacts of Bioenergy Growth

There has been a little bit of discussion here on the economic impacts of bioenergy growth for Wisconsin. I haven't had much luck tracking down any research on that but below are excerpts from an article in the Des Moines Register that touch on the economic impacts of increased bioenergy production in Iowa. I found this article clipped on the Truth about Trade and Technology website

“Infrastructure upgrades vital to Iowa's economic future

Iowa's economy relies on more than the state's 114,000 miles of road and 25,000 bridges to do business….its infrastructure needs are growing as Iowa adds a new generation of businesses.

For example, Iowa's ethanol plants will draw 1.4 million truckloads of corn as they close in on producing nearly 2 billion gallons annually. The amount will only climb as the nation pushes to use at least 36 billion gallons of ethanol by 2022. That amount includes 21 billion gallons of advanced renewable fuels, 16 billion of which must be cellulosic ethanol, made from such materials as cornstalks and switchgrass….Transportation officials say Iowa needs to spend $27.7 billion over the next two decades to improve deteriorating roads and bridges and prepare for future demand.”

So how is the State preparing to pay for all these improvements?

“U.S. Sen. Tom Harkin and Rep. Leonard Boswell want a federal study that looks at the feasibility of building a pipeline to move ethanol to other parts of the country. Officials say U.S. ethanol is too corrosive to move through existing pipelines without extensive modifications.”

This would seem like a logical way to distribute some of the financial burden of infrastructure improvements beyond Iowa taxpayers. However, I wonder if its a bit premature to be considering investing in a massive infrastructure upgrade when the future of cellulosic ethanol production is unclear. For example, where do you site an ethanol pipeline? Since its unclear which feedstocks are going to be the main cellulosic inputs (assuming this technology does become affordable) this seems like a tough nut to crack at present.

This article also makes reference to Hendricks industries which is planning to build a wind turbine manufacturing plant apparently. I wonder if this project is still a go in light of the fact that the recently passed Energy Bill did not extend the production tax credit for wind development.

“Hendricks Industries, founded by Ken Hendricks, the Wisconsin billionaire who died last week in a building accident, wants to use Keokuk's port on the Mississippi River to move turbine towers that will be built there.The company said it will spend $22 million updating the port and $57 million to build a plant to manufacture towers that are 260 feet long and weigh about 80 tons.”