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Michael Johanns
Michael Johanns
Secretary of Agriculture

October 11, 2006

Michael Johanns

Good afternoon. I join you from the America Center in St. Louis, MO, where the Departments of Energy and Agriculture have convened a major conference to advance the promise of renewable energy. Americans are discovering the road to energy independence is paved with natural resources grown right here at home. This is a new era for America's farmers, ranchers and rural communities as they seize this moment when opportunity meets need, and when American ingenuity breaks a century long addiction to oil.

Today we've gathered a blue-ribbon list of leaders to drive momentum toward cleaner, cheaper, and more reliable alternative energy sources. "Advancing Renewable Energy: An American Rural Renaissance," is designed to keep America competitive through affordable, abundant and clean energy.

The progress that is being made to efficiently grow "barrels from bushels" is one of the most impressive developments of our time. U.S. farm and forest lands could supply, on a sustainable basis, enough agricultural material to greatly reduce our dependence on foreign oil. There are already 101 ethanol plants in operation and another 39 plants under construction, which is leading some to call the promise of biofuels a gold rush for rural America. Of course, ethanol is just one type of renewable energy being developed. Animal waste is being turned into methane gas, which is used to power generators. Biomass is being used to create fuels, to generate electric power, and to replace petroleum-based products such as plastics and chemicals. These techniques allow us to reduce unwanted pollution. Additionally, research related to wind and solar energies is advancing at an impressive pace.

I look forward to hearing from you and offering a look inside all that we are doing at the Department of Agriculture and across the Administration to rapidly pursue alternatives to oil, particularly oil that comes from unstable parts of the world.

Aleman, from Baton Rouge, Louisiana writes:
Hello Mr. Johanns. Will the United States of America agricultural sector become more competitive globally if it adopts renewable resources in its infrastructure?

Michael Johanns
Global competitiveness results from a balance of many factors, such as access, costs of production (including transportation), customers' demands, reliability as a supplier, and other factors. In collaboration with America's farmers, ranchers and agri-businesses, we work hard to address these factors to ensure that markets are as open and fair as possible. Certainly renewable resource adoption in both production inputs, such as fuel, and in new marketing possibilities, such as bio-based products, will improve the economic vitality of producers and others involved in the generation of renewable energy. This expanded economic strength will undoubtedly enhance competitiveness.

Manny, from Tarpon Springs writes:
What is the purpose of the conference in St. Louis and why is the Agriculture Dept. involved?

Michael Johanns
Manny, the purpose of the conference is to accelerate the development and commercialization of renewable energy technologies. We are bringing together leaders from both the public and private sector to roll up our sleeves and collaborate to overcome challenges.

Specifically, we are identifying major issues and potential partnership opportunities between the private and public sectors. We are identifying critical pathways to rapid deployment of renewable energy technologies. That includes pinpointing bottlenecks and drafting policy recommendations to assist in overcoming obstacles.

I can tell you that we are also talking about policy incentives, such as loan guarantees and expedited approval processes, that might increase certainty, reduce risk, and accelerate the deployment of new energy sources.

You also asked why USDA is involved. Thanks for asking. I'm proud of the key role USDA is playing in the development of renewable fuels.

Between 2001 and 2005, USDA spent nearly $1.7 billion dollars on energy-related programs. In 2006 alone, our economists estimate that USDA will spend more than $270 million dollars on these programs.

Our assistance includes research activities, energy-transmitting infrastructure developments, information distribution, and financial and technical support. Already, we're seeing the results from those investments. Alternative energies are growing quickly. My hope is that before long we're producing a billion gallons of biodiesel per year. We're on track to quickly increase ethanol production capacity to more than eight billion gallons per year.

In 2005, 14 percent of corn went to ethanol production. In 2006, it is estimated that number will grow to 20 percent. Demand lifts corn prices: In 2006 the price per bushel is up 35 cents from 2005's price of $2 per bushel. That's good news for many in our agricultural community.

In fact, just this morning Energy Secretary Sam Bodman and I announced that through our joint Biomass Research and Development Initiative, we are awarding more than $17 million to fund 17 biomass research, development, and demonstration projects.

Developing renewable energy is a priority for the Bush Administration, as demonstrated by grants like these and the vision laid-out by the President himself.

Gary, from Rock Rapids, Iowa writes:
I have looking at building my own corn(hopefully whole corn plant)ethanal and biodiesel plant and wood and cardboard pellet plants around Sioux Falls,South Dakota. Where can I find out about technolgy for these plants and help with loansgrants to start up and run.

Is there help to take sawdust that normally goes to the landfill to make wood pellets for boilerstove feul? Is there help to develope ways to get the whole corn plant to convert to ethanal? Is there help with finacing or grants for the small farm based systems or research? Thank you for a reply. Gary Delfs

Michael Johanns
Gary, let me suggest several steps:

  1. You might consider applying for a feasibility study for your business idea from USDA's Value-Added Producer Grant Program.

  2. You could talk to the Department of Energy's National Renewable Energy Lab in Colorado about technology options.

  3. Finally, once you have a workable business plan for any of these renewable energy ideas, you could seek a grant from USDA's Renewable Energy and Energy Efficiency Program to install a small farm-based system.

I hope you are successful in your efforts!

Jennifer, from North Carolina writes:
Mr Johanns - In light of the massive auto and oil lobbies, will America ever see widespread alternative energy? Thank you.

Michael Johanns
I believe the potential of renewable energy has never been greater than it is now. In fact, the private sector is very engaged in the advancement of renewable energy, which strengthens the likelihood of success.

Renewable fuels are gaining a permanent foothold in the energy market. Let’s look at ethanol. Six years ago, there were 54 plants in operation, which could produce a combined total of less than two billion gallons per year. Today, those numbers have doubled. More than 100 plants now produce a combined total of close to five billion gallons each year. An additional 44 plants are under construction, which are expected to add another three billion gallons of ethanol to that total.

Biodiesel has its own success story. The number of plants has multiplied by more than eight times in the last six years – from 10 plants in 2000 to 86 plants today. Another 78 plants are either under construction or expanding. This will increase our production capacity to two billion gallons of biodiesel per year.

The energy market is highly competitive. Numbers like these demonstrate a strong upsurge in interest among investors. The market is ready to embrace these fuels.

John, from Moorestown, NJ writes:
I've been reading quite a bit on biofuels lately. While I've heard the President discuss ethanol at length, I also read about a promising new fuel called butanol. It supposedly can be fermented from a variety of substances including celulose, whey from dairy products, as well as corn and sawgrass. I understand DuPont and BP are already developing a pilot plant in Great Britain by converting an existing ethanol plant. The wikipedia web site discusses at length advntages over ethanol, including the ability to transport via pipelines (ethanol is too corrosive), as well as blendability with gasoline in many different proportions. Also advocates of butanol claim that existing car engines don't have to be modified to accept butanol blends. This fuel sounds almost too good to be true. Are there any plans to develop butanol in this country? Are there any disadvantages involved?

Michael Johanns
There are many sources of renewable energy. Ethanol has made dramatic advances, currently the highest-profile renewable fuel. But many others are growing fast.

Animal waste is being turned into methane gas, which is used to power generators. Biomass is being used to create fuels, to generate electric power, and to replace petroleum-based products such as plastics and chemicals. These techniques allow us to reduce unwanted pollution.

Additionally, research related to wind and solar energies is advancing at an impressive pace. Things like pecan shells, woodchips, and switchgrass – called biomass – have great potential. Without question, cellulosic ethanol has the potential to help us meet future demand.

In fact, as I write we’re fueling schools in the northwestern U.S. using some of these very products. We’re accomplishing this through an innovative program called Fuels for Schools. Woody biomass from our nation’s forests is being used to heat and cool schools. This Forest Service program is now expanding beyond the demonstration phase toward commercialization.

In reality, the cellulose in biomass has the potential to create a great deal more energy than corn. And, with each passing day, we come closer to a cost-effective technique for releasing that energy on a broader scale.

Ann, from Fort Worth, TX writes:
Why has there not been an implementation of alternative fuel in our society prior to now. The problem has been around for years. Our government can move mountains for other countrys, what about for its citizens?

Michael Johanns
There is no magic switch that the government alone can flip to increase the role of renewable energy in our society. That said, government certainly has a role to play and we are most certainly doing so. In fact, we are collaborating with the private sector to advance renewable energy. That’s precisely the purpose of the renewable energy conference that we at USDA are hosting with the Department of Energy in St. Louis today and tomorrow. We are bringing private sector leaders together with government officials at all levels to discuss how best to overcome obstacles and take advantage of renewable energy opportunities.

Our commitment goes far beyond this conference. Between 2001 and 2005, USDA spent nearly $1.7 billion dollars on energy-related programs. In 2006 alone, our economists estimate that USDA will spend more than $270 million dollars on these programs. Our assistance includes research activities, energy-transmitting infrastructure developments, information distribution, and financial and technical support.

Already, we’re seeing the results from these investments. Alternative energies are growing quickly. My hope is that before long we’re producing a billion gallons of biodiesel per year. We’re on track to increase ethanol production capacity to more than seven billion gallons per year in the very near future. In 2005, 14 percent of corn went to ethanol production. In 2006, it is estimated that number will grow to 20 percent. I’m pleased to report that we are certainly on the right track.

Allen, from Western KY writes:
Why not put Wind Mills on top of every mountain if you ever went squirrel hunting you know how the wind blows. Because on the Mountains the wind blows all the time it never quits

Michael Johanns
Thank you for your suggestion. A lot of research has gone into optimum placement of windmill electric generation sites. Some of the key factors, in addition to the obvious supply of wind, access for repairs, costs for running transmission lines, obtaining permission to construct, ability to link generators, etc. Wind farms located in mountainous areas would pose many challenges, but as technology advances, your idea to harness wind energy is shared by many and efforts are underway to expand our ability to harness wind energy.

Louis, from Miami,FL writes:
Why doesnt the federal government build solar power plants in the West? It did the same thing in Tennessee when it built the TVA. The government needs to provide a balance to private enterprise. It needs to regulate utilities so that customers are not abused. It needs to create alternatives to private sources and encourage use of alternative sources of energy. Building a solar power source in the western areas (primarily desert) could be used to supply power to states that have been most vulnerable in the recent past (california)and negate some of the leverage that privateenergy companies have on the public.

Michael Johanns
First, in the President's Advanced Energy Initiative, he sought dramatic new funding for making solar energy cost competitive with other sources of electricity. Second, several state governments, including in the West, are looking at ways of expanding the use of solar power. Third, energy legislation signed a year ago gave tax credits to producers of renewable energy. Fourth, solar-generated electricity, while still small overall, is growing rapidly, responding to favorable market conditions.

Jabril, from Fredericksburg, Virginia writes:
Dear Mr.Johanns, Earlier this year I sent an e-mail to you guys about the rising gas prices, and how we STILL depend on oil mainly from other countriesnations in the world. During my e-mail I also posed this question....... Why can't we find and use some other resources for example recycable trash to fuel are cars, trucks, buses,etc? Either way we are going to kill the O-Zone, and ourselves eventually, but saving our natural resources, which are non-renewable, and using other resources, like trash, and other renewable items will guarantee our children's children a full life.

Michael Johanns
President Bush did announce in his State of the Union Address this year a dramatic new initiative for using cellulosic sources - including some of the sources you mention - to end our addiction to foreign oil. This administration is strongly committed to building a new domestic renewable fuels industry.

tim, from henderson, nv. writes:
How can we stop consumption of petroleum as a main source of energy powering our nations commerce and what steps has the White House taken to accomplish this goal?

Michael Johanns
I’m pleased to report that you can be very proud of the leadership that President Bush has demonstrated in advancing renewable energy. Reducing our dependence on foreign oil requires a plentiful supply of renewable energy. The President has taken action on several fronts to ensure the policies are in place to foster this growth and to ensure that this administration is working as team to advance renewable energy.

Last year, President Bush signed into law the first National Energy Plan in more than a decade. Recognizing the significant potential of renewable energy, the Energy Policy Act of 2005 provided tax credits for wind, solar, and biomass energy. It included the first-ever tax credit for residential solar energy systems.

A few months later, in his State of the Union address, the President announced his Advanced Energy Initiative, which calls for a change in the way we power our homes, offices, and automobiles.

Without question, President Bush is committed to this effort. His Advanced Energy Initiative is a promise to America – a promise that our government will work hard to promote clean, domestic sources of energy. And USDA is working hard to fulfill that promise, as outlined in my response to a previous question.

Marion, from Tiffin Ohio writes:
Wouldn't federal incentives to manufacture ethanol be an economic boom for the family farm?

Michael Johanns
There are federal incentives in place. In fact, some claim that without government subsidies, ethanol costs too much to be competitive with oil. I disagree. Currently, Federal law authorizes a tax credit of 51 cents per gallon for ethanol through 2010. It costs an average of $1.10 to produce a gallon of ethanol. The average wholesale price of gasoline has risen to $2.04 per gallon in 2006. At those prices, ethanol is competitive with gasoline even without tax credits.

In reality, ethanol will continue to be competitive with gasoline so long as oil prices do not drop below $30 per barrel. By all predictions, tight supplies and an increasing demand for energy will very likely continue to keep oil prices at a higher level. The Department of Energy has forecast that oil prices will even out in the long run at a level higher than $50 per barrel. So while tax incentives encourage ethanol production, they certainly aren’t creating demand that isn’t already there. The demand exists and we are doing all we can to fulfill the demand and ensure a bright future for ethanol and other forms of renewable energy.

Charles, from Winter Park, Florida writes:
What do you see as the main energy source powering automobiles and other transportation systems in 10, 25, 50, and 100 years from now? Thank you.

Michael Johanns
We are at the beginning of fundamental changes in how we power our homes, offices and vehicles. These changes will unfold over the course of the next several decades. The number of options for consumers in terms of the vehicle they buy and the fuel it uses are growing all the time. No one can predict how and when exactly these changes will occur. But, we do know that the use of biofuels, like ethanol and biodiesel, will grow dramatically; that new types of vehicles will be offered and they will continue to grow more energy efficient; and that American scientists and entrepreneurs will continue to explore new pathways to energy independence, like fuel cell vehicles powered by hydrogen from renewable sources. We are confident that President Bush's strong support for renewable energy will lead us to eventually end our addiction to foreign oil.

Michael Johanns

Thank you for having me. I've enjoyed the opportunity to share with you what the President meant when he talked about turning switchgrass into fuel for cars and homes and businesses during this year's State of the Union.

For more information on USDA's efforts, please visit:

And, for more information on the President's Advanced Energy Initiative, please visit: /infocus/energy/