Bioeconomy development key to future of Iowa, the world
"I believe the Great Creator has put ores and oil on this earth to give us a breathing spell.....As we exhaust them, we must be prepared to fall back on our farms, which are God's true storehouse and can never be exhausted. For we can learn to synthesize materials for every human need from the things that grow."
--George Washington Carver
By Jeff Caldwell
Automobile side panels could be made from soy plastics. Peanut oil could be processed to yield chemicals and fuels.
These developments did not result from the latest bio-product research and development, but from experimentation early in the 20th century, when pioneers like Henry Ford and George Washington Carver saw the value in these renewable sources for products and chemicals. Yet, with the availability of inexpensive petroleum in the ensuing decades, the development of bio-based products took a back seat to those based on the non-renewable source, upon which the economies of the U.S. and the world have become deeply reliant.
But, in more recent years, as the price for a barrel of crude oil has skyrocketed to record-high levels, the value of bio-based alternatives has been revisited to the point at which a push today exists to excel research, development and production of crop- and biomass-based products to work with and, in some instances, take the place of their petroleum-based peers. The economies of Iowa, the United States and the world are now on the cusp of feeling the boost of the development of the bio-products industry.
Federal and state government officials and industry representatives gathered to discuss and learn more about the world of bio-based products, the economy that can be created and what is required to foster growth in the industry at BIO Conference, a Bio-based Industry Outlook, March 7 to 8, on the campus of Iowa State University in Ames, Iowa.
What is a bioeconomy? While it reaches into many facets of the existing economy, the basis for a bioeconomy is the generation of carbon using renewable resources, like crops and other biomass, instead of relying upon nonrenewable, petroleum-based carbon, according to Georg Anderl, president of the board of directors of the BIOWA Development Association, a group formed to promote growth and development of the bioeconomy in Iowa, with representatives from each segment of the economy that will be directly involved.
"In my own words, what it really means is, rather than getting the non-renewable carbon we get out of the ground today that was put there millions of years ago by plant and animal material and converted into coal and oil, we should be able to get that raw material, like carbon, from the surface of the land, in the crops we grow," Anderl said. "One of the phrases I like to use is that we should be able to till, not drill, for our natural resources."
As such, Iowa is poised to become a pre-eminent bioeconomy model in the U.S. and the world, Anderl said. As the largest producer of biomass in the U.S., with further development of processing and production of bioproducts, Iowans can see dramatic changes in the economy and improvements in fiscal health in the future.
"Our ability for growing biomass here in Iowa is really why Iowa should be a focal point within the United States to develop a bioeconomy," Anderl said.
Yet, creating a bioeconomy does not end with existing production and processing of biomass. Another step, also taking advantage of existing Iowa resources, entails the research and development in the science of seeds and plants, Anderl said.
"A bioeconomy is more than producing the end raw materials. It really starts first with the plant science," he said. "You have to have the right plants producing the right crops, which lead to the production or processing of those raw materials."
Of utmost importance to the development of a bioeconomy, according to Stanley R. Johnson, ISU Extension vice provost, is the sharing of both resources and information. Since government and academic officials admittedly both have a "very poor record" in determining the most feasible development opportunities in industry, Johnson said the most appropriate way to approach coordination of the industry is through the private sector, something that has begun in Iowa. As a result, instead of viewing coordination as a "we ought to" situation, Johnson said the development of the bioeconomy is viewed as a system whose proliferation depends on action and the exploitation of opportunities stemming from shared knowledge.
"If you want to grow an industry, you'd like to get some coordination and would like to have some shared knowledge about what the potential is for the industry," said Johnson, who, along with Anderl and Gov. Tom Vilsack, adopted the Biobased Products and Bioenergy Vision and Roadmap for Iowa. "The government has a very poor record in picking winners...academics have a similar capacity for prediction that government has. This process taps the people who are actually doing the development, the private sector folks, to share knowledge and create this vision."
From the initial step of coordination, two tracks exist in the development of a bioeconomy that are carried out simultaneously, yet separated by both time and sectors of business involved, according to Anderl. The first track comprises the basic production of commodities to yield feedstuffs to fuel further processing later on. More consistent with today's crop production, Anderl said the output of this track is high in volume, yet relatively intermediate in value.
"This will be in the near- to mid-term track, using technologies that are currently, or shortly will be available," Anderl said.
The second step, more forward-looking and of lower volume but higher value, is the future development of genetic modification of crops, making it possible to gear production toward specific traits that are important to biomass and, ultimately, bio-based chemicals and products. While some regulatory and perceptual obstacles remain in the way of the widespread approval of this element to the bioeconomy's development, Anderl said it is inevitable this track will proceed in the future.
"As those become available, we can actually improve the efficiency. We all realize there are a lot of hurdles that need to be overcome before this can become a reality," he said. "There are quite a few issues with respect to protocols, regulations and certainly some of the consumer acceptance. However, it will be something that will become a reality in the future."
A common misconception surrounding the development of a bioeconomy, Anderl said, is the notion of a conflict between the petroleum oil and bio-based industries, based on the idea that the two represent conflicting interests. This is far from reality, however. With petroleum industry officials fully aware of the dwindling state of their nonrenewable product base, they are seeking out the services of their renewable fuel industry peers in order to preserve and extend their resources.
"It's actually very complementary. When you look at the production of oil or mining of coal, I think we all realize that's a diluted resource," Anderl said. "Although we may have more, we don't exactly know when it's going to run out. The chemical industry is interested in new processes and new feedstocks, because they're concerned about being dependent on oil and natural gas.
"We need to be able to fill the gap. That's why what we're really going to do is complement the oil supply to meet worldwide demand."
The complementary bond connecting the renewable and nonrenewable energy sectors is not only embraced but also driven by the petroleum industry, according to Floyd Barwig, director of the Iowa Energy Center. But, in addition to the idea of a rift dividing the two energy generation industries, the general public's reluctance to trust large corporations, in the wake of corporate scandals like Enron, contributes to an air of distrust of oil companies, many of which are considered "large" by corporate standards. Yet, as time progresses, according to Barwig, more signs from petroleum companies point to cooperation with the bio-fuel industry.
"Everybody's suspicious of the motives of very large corporations that make massive amounts of money, and their practices. But, you look at something like Enron, and how can people not be suspicious of large corporations?" he said. "But, [petroleum companies] are all positioning themselves to say 'Are we an oil company, or are we an energy and chemicals company? If we're an energy and chemicals company, then we have to go with the new technologies.'"
So, what should crop producers, the ones most directly involved with the primary means through which a bioeconomy is first established, do to promote such bio-products growth in the future? Barwig echoed Johnson in emphasizing the importance of the sharing of information surrounding the industry and its development, between both peers and those involved in different sectors of the bioeconomy.
"There are only so many hours in the day, and what you spend on reading and staying up-to-date, devote a little time to this subject," he said. "This is worth tracking. This could really change the economies of agriculture, and if it doesn't work in Iowa and in the Midwest, where is it going to work? This is the perfect place."
Within this swapping of information, Barwig said the fact these developments aren't altogether new should be emphasized.
"People say 'Well, this is all new.' But, one piece of the message should be that it's not new. George Washington Carver was making hundreds of things from peanuts and sweet potatoes long ago. The man died in 1943," Barwig said. "People need to understand this isn't some far-out, probably-would-never-work technology, but in fact, we're going back to things that were done before."
Barwig gave examples of the economic impacts individual parts of a bioeconomy could have on Iowa's economy as a whole. Even without advanced processing and utilization, corn stover today represents a tremendous untapped financial resource.
"What if you took half the corn stover off the fields, leaving half for erosion control. How much would you have in any given year? The number comes up to about 24 million tons," Barwig said. "If you turn 24 million tons into two cents per pound, that's a billion dollars."
But, with further developments in processing and product creation, the fiscal boost could be exponentially higher.
"What if we could move it further up the value chain and take that 24 million tons and make it worth as much as an ag plastic, worth about $1.50 per pound? Then, you're talking about adding $72 billion to the state's economy. You're in essence almost doubling the state's economy.
"We're talking huge economic development potential."
Jeff Caldwell can be reached by phone at 620-227-1805, or by e-mail at jcaldwell@hpj.com.
Date: 4/1/04
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