Now that legislation in the U.S. has jump-started the ethanol industry, priority should be directed less at the expansion of the industry and more at an evolution that offers the most benefits for the environment and energy security.

Key Findings

Farm Policy Recommendations

  1. Resist the pressure to allow farmers penalty-free "early outs" from their CRP contracts.
  2. Increase funding for working lands conservation programs such as CSP and EQIP.
  3. Extend "sodbuster" compliance requirements for receipt of commodity payments to all acreage in production, not just highly erodible lands.
  4. Create a pilot TMDL project for the Chesapeake Bay with joint USDA/EPA jurisdiction.
  5. Extend compliance requirements for receipt of commodity payments to include nutrient management requirements in TMDL non-attainment watersheds.
  6. Establish a new program in the Farm Bill to encourage riparian buffers.
  7. Require all projects that receive federal funds to explore crop yield improvements to explicitly address the soil, water, and GHG implications of the new production methods.
  8. Promote conservation tillage in corn production and provide research resources directed explicitly at use of slowrelease fertilizers and use of precision nitrogen management in row crop production.
  9. Task the USDA with development of a consistent methodology for calculating the environmental impacts of biofuels feedstock production.

Executive Summary

Thanks in large part to the Renewable Fuels Standard (RFS)---a legislative mandate for increased renewable fuels use that passed as part of the Energy Policy Act of 2005---the corn ethanol industry is expanding at an unprecedented rate in the United States. In its spring planting projections, the USDA projected that corn acreage in the U.S. would increase by 12 million acres, or 15%, during the 2007 planting season alone to meet demands for ethanol and other uses.

This study explores the potential environmental impacts of this surge in corn production, and suggests some policy measures to help make agriculture in general more robust to increased demands for energy production.