Abstract  Lifecycle analysis (LCA) metrics of greenhouse gas emissions are increasingly being used to select technologies supported by climate policy. However, LCAs typically evaluate the emissions associated with a technology or product, not the impacts of policies. Here, we show that policies supporting the same technology can 1 lead to dramatically different emissions impacts per unit of technology added, due to multimarket responses to the policy. Using a policy-based consequential LCA, we find that the lifecycle emissions impacts of four US biofuel policies range from a reduction of 16.1 gCO(2)e to an increase of 24.0 gCO(2)e per MJ corn ethanol added by the policy. The differences between these results and representative technology-based LCA measures, which do not account for the policy instrument driving the expansion in the technology, illustrate the need for policy-based LCA measures when informing policy decision making.

Abstract  Estimates of land use change (LUC) attributable to the U.S. Renewable Fuel Standard (RFS) are critical for evaluation of the program's impacts on air and water quality, biodiversity, and soil quality. To improve our understanding of the range of published estimates, we reviewed 29 studies published since 2008 attributing domestic LUC to the RFS, updating previous comparisons and adding a growing number of empirical approaches to estimating biofuel-induced LUC. To identify principal reasons underlying differences in reported effects, we documented key attributes of studies' methods including spatial extent, time period, baseline scenario, policy influence, and LUC definitions. Across computable general equilibrium (CGE) and partial equilibrium (PE) economic simulation model studies we found a range of 0.01–2.45 million acres of net cropland expansion per billion-gallon increase in biofuels. Empirical approaches reporting national-scale estimates fall within this range, reporting 0.38–0.66 million acres per billion-gallon increase. Empirical studies had a much smaller range of estimates and were closer to PE approaches than CGE. Studies generally did not represent all the potential drivers of biofuel production, and instead reported projections reflecting a combination of RFS impacts and other influences. Additional refinements to the modeling and empirical approaches reviewed in this study can further improve our understanding of the land use change driven by biofuels and the RFS Program.

Abstract  The potential long-term impacts and systemic effects of incentives are of great interest to the biofuels industry and decision makers, particularly with regards to forthcoming mandates for biofuels. We have used the Biomass Scenario Model (BSM) to build a theoretical understanding of the role of incentives on the evolution of the biomass-to-biofuels market. It models a broad range of biofuels such as renewable gasoline, diesel, and aviation fuel. In this paper, we focus on cellulosic ethanol as we describe model-based insights into potential incentives that are aimed at stimulating industry growth while tempering overall incentive-related government expenditures. Subsequent research can test the key insights gained through BSM simulations against actual policy implementation and actual outcomes.

Abstract  BACKGROUND: The GTAP model has been used to estimate biofuel policy induced land use changes and consequent GHG emissions for more than a decade. This paper reviews the history of the model and database modifications and improvements that have occurred over that period. In particular, the paper covers in greater detail the move from the 2004 to the 2011 database, and the inclusion of cropland intensification in the modeling structure.

RESULTS: The results show that all the changes in the global economy and agricultural sectors cause biofuels induced land use changes and associated emissions can be quite different using the 2011 database versus 2004. The results also demonstrate the importance of including land intensification in the analysis. The previous versions of GTAP and other similar models assumed that changes in harvested area equal changes in cropland area. However, FAO data demonstrate that it is not correct for several important world regions. The model now includes land intensification, and the resulting land use changes and emission values are lower as would be expected.

CONCLUSIONS: Dedicated energy crops are not similar to the first generation feedstocks in the sense that they do not generate the level of market-mediated responses which we have seen in the first-generation feedstocks. The major market-mediated responses are reduced consumption, crop switching, changes in trade, changes in intensification, and forest or pasture conversion. These largely do not apply to dedicated energy corps. The land use emissions for cellulosic feedstocks depend on what we assume in the emissions factor model regarding soil carbon gained or lost in converting land to these feedstocks. We examined this important point for producing bio-gasoline from miscanthus. Much of the literature suggests miscanthus actually sequesters carbon, if grown on the existing active cropland or degraded land. We provide some illustrative estimates for possible assumptions. Finally, it is important to note the importance of the new results for the regulatory process. The current California Air Resources Board carbon scores for corn ethanol and soy biodiesel are 19.8 and 29.1, respectively (done with a model version that includes irrigation). The new model and database carbon scores are 12 and 18, respectively, for corn ethanol and soy biodiesel. Thus, the current estimates values are substantially less than the values currently being used for regulatory purposes.

Abstract  This paper integrates economic and physical models to assess: a) how increases in agricultural commodity prices, driven by ethanol production and other factors, affect land use and cropping systems in the US Midwest, and b) how the changes in land use and cropping systems in turn affect environmental quality in the region. The empirical framework includes a set of econometric models that predict land conversion, crop choices, and crop rotations at the parcel level based on commodity prices, land quality, climate conditions, and other physical characteristics at the sites. The predictions are then combined with site-specific environmental production functions to determine the effect of rising commodity prices on nitrate runoff and leaching, soil water and wind erosion, and carbon sequestration. Results suggest that increasing commodity prices will result in widespread conversions of non-cropland to cropland. Fifty percent of the region’s pasture and range land will be converted to cropland with $6 corn. Rising commodity prices will also result in dramatic changes in crop mix and rotation systems in the Midwest. With $6 corn, the total acreage of corn will increase by 23% and 40% in the Corn Belt and Lake States, respectively; the acreage of continuous corn will increase considerably in both regions as well. These changes in land use and crop mix will have a large impact on agricultural pollution. Approaches to mitigating the environmental impacts are discussed.

Abstract  We investigate effects of corn-based ethanol plants on local land uses using county-level panel data for Iowa for 1997 through 2009 and an Arellano-Bond difference-generalized method-of-moments estimator. Our results show that ethanol plants have statistically significant effects on the proportion of acres planted to corn in the plants’ host counties. Furthermore, ceteris paribus, the land-use-change effect of locally owned plants (owned by local farmers or cooperatives) is about twice as large as the effect of plants with nonlocal owners. We also explore implications for the environment of ethanol plants and the changes in land use that they induce.

Abstract  Assessments of the impact of the U.S. renewable fuel standard (RFS) should inform consideration of future biofuels policy. Conventional wisdom suggests the RFS played a major role in stimulating the ten-fold expansion in ethanol production and consumption in the United States from 2002 to 2019, but evidence increasingly suggests the RFS may have had a smaller effect than previously assumed. Price competitiveness, federal and state policies such as reformulated gasoline requirements, and octane content in ethanol also affect ethanol market attractiveness. This study explores the roles of policy and economic factors by comparing historical data with results from scenarios simulated in a system dynamics model. Results suggest price competitiveness may explain much of the growth in the ethanol industry from 2002 to 2019. The Volumetric Ethanol Excise Tax Credit and phaseout of the oxygenate methyl tert-butyl ether contributed to earlier growth relative to expected timing of growth based on fuel price alone. The RFS (modeled through observed Renewable Identification Numbers) contributed to increased ethanol production in later years and may have increased production in the earlier years if risk of investment was decreased by the RFS Program.

Abstract  In the social sciences, estimating causal effects is particularly difficult. Gold standards are set by randomized experiments in many cases expensive, unenforceable for ethical and practical reasons. Recent research has drawn attention to techniques that under some conditions, could estimate causal effects on non-experimental observable data. One technique is the instrumental-variables (IVs) approach. This approach is used to determine variation that is exogenous in treatment and to estimate causal inferences. This paper begins by explaining the logic of IVs and then reviews the literature on the use of the IVs approach in the educational context. The most common types of IVs and the guidelines for selecting appropriate variables are explained. The statistical background of IVs estimation is described, which is followed by a discussion of the assumptions that underlie statistical procedures. Finally, empirical examples that use data from the Polish extension of the Programme for International Student Assessment are presented to estimate the effects on student learning outcomes of having at least one neighborhood friend in the classroom.

Abstract  Ethanol and methyl-tertiary butyl ether (MTBE) were close substitutes in the gasoline additives market until MTBE was banned due to the concerns about groundwater contamination, leading to a sudden and dramatic substitution toward ethanol as an alternative oxygenate and octane-booster. We use variation in the timing of MTBE bans across states to identify their effects on gasoline prices. We find that state bans increased reformulated gasoline prices by 3–6 cents in non-Midwestern states for which the bans were binding, with larger impacts during times of high ethanol prices relative to MTBE and crude oil. We find qualitatively similar, yet smaller effects for conventional gasoline. We argue on the basis of a simple conceptual model and supporting empirical evidence that these bans functioned as implicit ethanol blending mandates in areas that were previously using MTBE to comply with strict environmental constraints. Overall, our results are consistent with the theoretical prediction that mandating a minimum market share for a more costly alternative fuel—either directly, or implicitly through a ban on the preferred conventional fuel—will inevitably increase fuel prices in a competitive market.

Abstract  The U.S. ethanol industry is lobbying hard for an extension of existing ethanol import tariffs and blenders tax credits before they expire at the end of 2010. The purpose of this study is to examine the likely consequences on the U.S. ethanol industry, corn producers, taxpayers, fuel blenders, and fuel consumers if current policy is not extended. Impacts of different ethanol policies in both 2011 and 2014 were estimated. Estimates were obtained by developing a new stochastic model that calculates market-clearing prices for U.S. ethanol, Brazilian ethanol, and U.S. corn. The model is stochastic because market-clearing prices are calculated for 5,000 random draws of corn yields and wholesale gasoline prices. Key assumptions in this study are that the strong growth in flex-fuel vehicles in Brazil continues; intermediate ethanol blends with few restrictions are implemented in U.S. markets in 2014; U.S. ethanol production capacity reaches 15 billion gallons in 2014; and Brazilian ethanol production increases by at least 45% by 2014. Projected strong demand for ethanol in Brazil combined with a largely saturated U.S. ethanol market means that elimination of ethanol import tariffs would have almost no impact on U.S. corn and ethanol markets in 2011. Elimination of the tax credit would impact markets modestly, with ethanol production declining by an average of about 700 million gallons. This reduction in ethanol production would cause corn prices to drop by an average of 23 cents per bushel. Ethanol prices would drop by 12 cents per gallon. Elimination of the tax credit would shift the burden of meeting mandates from taxpayers to blenders and consumers. Taxpayers would save more than $6 billion through elimination of the tax credit, or almost $7.00 per gallon of ethanol produced in excess of mandated amounts. The impacts of a change in U.S. ethanol policy in 2014 are larger than 2011 impacts because Brazil has a chance to respond by ramping up its ability to export in response to trade liberalization. But because of strong domestic demand growth in Brazil and limits on how fast Brazilian ethanol production can increase, the impacts of a change in policy are still modest. As long as the mandate is maintained, U.S. ethanol production drops by no more than 500 million gallons, corn prices drop by no more than 16 cents per bushel, and ethanol prices drop by no more than 35 cents per gallon. If the impact of intermediate blends is not as strong as assumed in this study, then there will be less incentive for Brazil to export ethanol and the impacts of tariff elimination would be even more modest.

Abstract  In response to the growing concerns from State and local officials and the public, U.S. EPA Administrator Carol M. Browner appointed a Blue Ribbon Panel in November 1998, to investigate the air quality benefits and water quality concerns associated with oxygenates in gasoline, and to provide independent advice and recommendations on ways to maintain air quality while protecting water quality. The Panel members consisted of leading experts from the public health and scientific communities, automotive fuels industry, water utilities, and local and State governments. The Panel was charged to: (1) examine the role of oxygenates in meeting the nations goal of clean air; (2) evaluate each products efficiency in providing clean air benefits and the existence of alternatives; (3) assess the behavior of oxygenates in the environment; (4) review any known health effects; and (5) compare the cost of production and use and each products availability -- both at present and in the future. Further, the Panel studied the causes of ground water and drinking water contamination from motor vehicle fuels, and explored prevention and cleanup technologies for water and soil.

Abstract  The use of ETBE (ethyl-tert-butylether) as gasoline additive has recently grown rapidly. Contamination of aquatic systems is well documented for MTBE (methyl-tert-butylether), but less for other gasoline additives. Due to their mobility they may easily reach drinking water collection areas. Odour and flavour thresholds of MTBE are known to be low, but for ETBE and TAME (methyl-tert-amylether) hardly information is available. The objective here is to determine these thresholds for MTBE, ETBE and TAME, and relate these to concentrations monitored in thousands of samples from Dutch drinking water collection areas. For ETBE odour and flavour thresholds are low with 1-2microgL(-1), for MTBE and TAME they range from 7 to 16microg L(-1). In most groundwater collection areas MTBE concentrations are below 0.1microg L(-1). In phreatic groundwaters in sandy soils not covered by a protective soil layer, occasionally MTBE occurs at higher concentrations. For surface water collection areas a minority of the locations is free of MTBE. For river bank and dune infiltrates, at a few locations the odour and flavour threshold is exceeded. For ETBE fewer monitoring data are available. ETBE was found in 2 out of 37 groundwater collection areas, in concentrations below 1microgL(-1). In the surface water collection areas monitored ETBE was found in concentrations near to the odour and flavour thresholds. The low odour and flavour thresholds combined with the high mobility and persistence of these compounds, their high production volumes and their increased use may yield problems with future production of drinking water.

Abstract  For regulators to develop risk-based screening levels (RBSLs) for a petroleum constituent, a maximum allowable concentration at an exposure point, such as a drinking water action level, must be established. Of particular interest to regulators of leaking underground storage tank (LUST) sites in Delaware is the development of RBSLs for the oxygenated compounds that are added to gasoline to increase octane rating and promote cleaner burning fuel. Whereas methyl-tertiary butyl ether (MTBE) became the first of the oxygenated compounds to gain regulatory attention in Delaware, tertiary-butyl alcohol (TBA) is not far behind. TBA has been detected at LUST sites throughout Delaware and in some cases has been detected in private water supplies. However, Delaware does not currently have a drinking water action level, or maximum allowable exposure concentration, on which to base regulatory decisions regarding TBA. Toxicological data is inconclusive in classifying TBA as a carcinogen. However, carcinogenic responses are reported in rat and mice studies at extremely high doses. To address TBA in Delaware's Risk-Based Corrective Action Program, the Delaware Division of Public Health must calculate drinking water action levels based on the results of the toxicological data. However, the establishment of TBA action levels could have a tremendous impact on the costs associated with investigating and remediating a LUST site. TBA may add $2000 to $5000 per year in analytical costs alone for an average LUST site in Delaware.

Abstract  We present a new framework to identify supply elasticities of storable commodities where past shocks are used as exogenous price shifters. In the agricultural context, past yield shocks change inventory levels and futures prices of agricultural commodities. We use our estimated elasticities to evaluate the impact of the 2009 Renewable Fuel Standard on commodity prices, quantities, and food consumers' surplus for the four basic staples: corn, rice, soybeans, and wheat. Prices increase 20 percent if one-third of commodities used to produce ethanol are recycled as feedstock, with a positively skewed 95 percent confidence interval that ranges from 14 to 35 percent.

Abstract  The use of corn for ethanol production in the United States quintupled between 2001 and 2009, generating concerns that this could lead to the conversion of forests and grasslands around the globe, known as indirect land-use change (iLUC). Estimates of iLUC and related food versus fuel concerns rest on the assumption that the corn used for ethanol production in the United States would come primarily from displacing corn exports and land previously used for other crops. A number of modeling efforts based on these assumptions have projected significant iLUC from the increases in the use of corn for ethanol production. The current study tests the veracity of these assumptions through a systematic decomposition analysis of the empirical data from 2001 to 2009. The logarithmic mean divisia index decomposition method (Type I) was used to estimate contributions of different factors to meeting the corn demand for ethanol production. Results show that about 79% of the change in corn used for ethanol production can be attributed to changes in the distribution of domestic corn consumption among different uses. Increases in the domestic consumption share of corn supply contributed only about 5%. The remaining contributions were 19% from added corn production, and 2% from stock changes. Yield change accounted for about two-thirds of the contributions from production changes. Thus, the results of this study provide little support for large land-use changes or diversion of corn exports because of ethanol production in the United States during the past decade.

Abstract  The increase in corn ethanol production has raised concerns about its indirect impacts on the expansion of cropland and implications for the environment and continues to be a controversial issue. In particular, land enrolled in the Conservation Reserve Program (CRP) declined by 7.2 million acres between 2007 and 2012 while corn ethanol production more than doubled. However, the extent to which this decline in CRP acres can be causally attributed to increased ethanol production is yet to be determined. Using a dynamic, partial equilibrium economic model for the US agricultural sector we find that doubling of com ethanol production over the 2007-2012 period (holding all else constant) led to the conversion of 3.2 million acres of unused cropland, including 1 million acres in CRP, to crop production. While substantial in magnitude, we find that these land use changes due to biofuel production accounted for only 16% and 13% of the total reduction in unused cropland and in CRP acres, respectively, that occurred over the 2007-2012 period. We also find that the land use change per million gallons of corn ethanol has declined non-linearly over time from 453 acres to 112 acres over the 2007-2012 period.

Abstract  We present a novel bottom-up approach to estimate biofuel-induced land-use change (LUC) and resulting CO2 emissions in the U.S. from 2010 to 2022, based on a consistent methodology across four essential components: land availability, land suitability, LUC decision-making, and induced CO2 emissions. Using high-resolution geospatial data and modeling, we construct probabilistic assessments of county-, state-, and national-level LUC and emissions for macroeconomic scenarios. We use the Cropland Data Layer and the Protected Areas Database to characterize availability of land for biofuel crop cultivation, and the CERES-Maize and BioCro biophysical crop growth models to estimate the suitability (yield potential) of available lands for biofuel crops. For LUC decision-making, we use a county-level stochastic partial-equilibrium modeling framework and consider five scenarios involving annual ethanol production scaling to 15, 22, and 29 BG, respectively, in 2022, with corn providing feedstock for the first 15 BG and the remainder coming from one of two dedicated energy crops. Finally, we derive high-resolution above-ground carbon factors from the National Biomass and Carbon Data set to estimate emissions from each LUC pathway. Based on these inputs, we obtain estimates for average total LUC emissions of 6.1, 2.2, 1.0, 2.2, and 2.4 gCO2e/MJ for Corn-15 Billion gallons (BG), Miscanthus × giganteus (MxG)-7 BG, Switchgrass (SG)-7 BG, MxG-14 BG, and SG-14 BG scenarios, respectively.

Abstract  Purpose The purpose of this paper is to examine the market impacts of US biofuels and biofuel policies. Design/methodology/approach Two methods of analysis are employed. The first method looks back in time and estimates what US crop prices would have been during the 2005 to 2009 marketing years under two scenarios. The second method of analysis is forward looking and examines the market impacts of the blender tax credit and mandate on the distribution of prices in the 2011 calendar and marketing year. Findings The results developed in the previous two sections show that US ethanol policies modestly increased maize prices from 2006 to 2009 and that market impacts of the policies will be larger under tighter market conditions. Practical implications More flexible US biofuel policy including removing the blenders tax credit, which does not help US biofuel industry as long as the mandates are in place, and relaxing blending mandates when feedstock supplies are low. Originality/value This report makes three contributions to understanding the extent to which US biofuel policies contribute to higher agricultural and food prices. First, estimates of the impact of US ethanol policies on crop and food prices reveal that the impacts of the subsidies were quite modest. The second contribution is to provide estimates of the impact on agricultural commodity prices and food prices from market‐driven expansion of ethanol. The final contribution of this report is improved insight into how current US biofuel policies are expected to affect crop prices in the near future.

Abstract  Corn is currently the major source of ethanol production in the United States. This paper presents an overview of transportation issues that the rapidly expanding ethanol industry faces in the United States. It relates total ethanol production at the beginning of 2007, notes the impact on corn production and prices of demand for ethanol, and discusses what part of the United States produces most of the ethanol for this country. Some other facts include the following: railroads were the major mode of transportation for ethanol in 2005 and trucks were the second most frequent transportation mode for ethanol; rail freight is forecast to increase 88% between 2002 and 2035 (before ethanol production expansion); freight transportation by truck is forecast to double between 2002 and 2020 and truck driver shortages are expected to reach 219,00 by 2015 (before ethanol production expansion).

Abstract  Biofuels represent an important source of renewable energy and may play a crucial role in developing sustainable energy strategies for many countries and the world as a whole. The pros and cons of biofuels, however, have been debated both scientifically and politically. They remain a topic of controversy. In this paper, the evolvement of the perspectives and policies on biofuels in the United States in the past several decades was reviewed. Four different periods, that is, the period prior to 1978 (marked by the passage of the Energy Act in 1978); 1978-1989 (ending with the passage of the Clean Air Act Amendments of 1990); 1990-2004 (ending with the passage of the energy act of 2005); and 2005 to the present, which were characterized by defining events of major policy importance were identified. Each time period was assessed using the Ostrom institutional analysis and development (IAD) framework to show the impact of the evolving interests and influences of global players on policy choices related to biofuels in the United States. The US has a long history of supporting corn-based ethanol and more recently advanced biofuels. Changes in perspectives on biofuels from largely unrelated groups led to changes in policy and market dynamics. Until the late 1990s, most perspectives and policies tended to be aligned and significantly supportive of corn-based ethanol in the United States. In the early 2000s, it became clear that the complications associated with first generation biofuels and corn-based ethanol in particular, were too numerous and too severe to overlook. The need for better options has spurred interest in new technologies and more environmentally benign feedstocks, but, there is little prospect for biofuels playing a significant role in the near term without greater alignment among key players.

Abstract  The Renewable Fuel Standard (RFS) specifies the use of biofuels in the United States and thereby guides nearly half of all global biofuel production, yet outcomes of this keystone climate and environmental regulation remain unclear. Here we combine econometric analyses, land use observations, and biophysical models to estimate the realized effects of the RFS in aggregate and down to the scale of individual agricultural fields across the United States. We find that the RFS increased corn prices by 30% and the prices of other crops by 20%, which, in turn, expanded US corn cultivation by 2.8 Mha (8.7%) and total cropland by 2.1 Mha (2.4%) in the years following policy enactment (2008 to 2016). These changes increased annual nationwide fertilizer use by 3 to 8%, increased water quality degradants by 3 to 5%, and caused enough domestic land use change emissions such that the carbon intensity of corn ethanol produced under the RFS is no less than gasoline and likely at least 24% higher. These tradeoffs must be weighed alongside the benefits of biofuels as decision-makers consider the future of renewable energy policies and the potential for fuels like corn ethanol to meet climate mitigation goals.

Abstract  The U.S. Renewable Fuel Standard (RFS) has been implicated as an agent of influence in agricultural commodity markets and a driver of land use and land management changes. However, direct attribution of these effects to the RFS has remained elusive and uncertain, a shortcoming that has hindered policy evaluation and potential reform. We analyze the effects of the RFS on corn, soy, and wheat prices and integrate these results with (i) spatially explicit observations of land use change, (ii) an econometric model of land use response, and (iii) additional models of agro-ecological processes, carbon emissions, and watershed hydrology to quantify the total land and water impacts of the RFS policy implementation. We independently model the effects of the policy via two pathways—land use intensification, or the preferential planting of corn instead of other crops, and cropland extensification, or the conversion of grasslands and other natural lands to cropland. We find that in the 8 years following passage of the RFS in 2007, the policy bolstered the amount of corn planted on existing cropland each year by an average of over 5 million acres. During the same time period, over 10 million acres of uncultivated land were converted to crop production in the U.S., of which nearly 3 million may be directly attributable to the RFS. These landscape changes resulted in more than a million tons of additional nitrogen application as well as novel carbon emissions on the order of 10 TgC yr-1. Our study is the first spatially explicit assessment of RFS impacts on total U.S. land use change and the first to quantify associated field-level water quality and carbon effects. The approach provides a blueprint for the integration of comprehensive land change data with causal economic models and demonstrates a novel method for measuring environmental outcomes across an entire agricultural industry, from the policymaking process through to implementation on the landscape.