USDA sets BCAP on horrid path

Biomass is a bit like Longfellow’s little girl with a curl: when it is good, it can be very, very good, and when it is bad, it’s horrid. Done right, converting biomass to heat or fuel can reduce global carbon emissions, enhance energy security, reward innovation, and create jobs. Done wrong, it spews new carbon into the atmosphere, destroys forests, crowds out food producers, distorts markets, and wastes fabulous sums.

Right now, the U.S. Department of Agriculture is bent on doing biomass wrong. The most glaring example could well be the Biomass Crop Assistance Program. BCAP came from the 2008 Farm Bill’s Title IX, in which Congress threw money and perks at biomass energy. Our solons included modest sideboards, but mostly left it to the US Department of Agriculture to figure out how who gets what.

BCAP was supposed to kick start renewable biomass cropping. Its “primary focus,” Congress said, was “crops that show exceptional promise for producing highly energy-efficient bioenergy or biofuels, that preserve natural resources, and that are not primarily grown for food and animal feed.” Congress put some plants and lands off limits itself, but charged USDA with making eligibility decisions based on resource impacts, economic factors, and “any additional information, as determined by the Secretary.” In short, sweeping discretion.

Mostly, BCAP was supposed to pay farmers to establish new biomass crops. It also contains, however, a little paragraph authorizing subsidies for delivery of other types of biomass to energy producers. A real sleeper, in part because it covers not just agro-products, but wood as well. This “CHST” provision (for “collection, harvest, storage, and transportation”) offers to match – in effect to double – the price processors pay for biomass.

It would be hard to overstate BCAP’s possible impacts on the environment and the economy. Congress didn’t set a limit on BCAP spending. Instead, it directed that for the next five years USDA use as many funds from the Commodity Credit Corporation “as are necessary.” The CCC has a $30 billion line of credit with the U.S. Treasury. That’s right. With a “b.”

USDA has produced a token draft environmental review for BCAP. Its crabbed and weak consideration of the potential impacts caused by different possible implementation rules has occasioned sharp criticism. We’re waiting to see how the agency responds, but if this exchange between the thoughtful Loni Kemp and a testy FSA economist is any indication, I’m not optimistic. (See Loni’s initial post with his comment and her response.)

In the meantime, though, it’s off to the races in a huge way on CHST subsidies. In the first quarter of this year alone, USDA plans to spend more than $500 million dollars underwriting that little paragraph. And the agency has added almost no safeguards to the bare bones requirements of the statute. It will pay for biomass that:

• Comes from clearcutting national forests in the name of “preventive treatment;”
• Strips agricultural land of leaves and stalks that stop erosion and replenish the soil;
• Results from converting native forests to tree farms;
• Displaces food production into more marginal and sensitive land and drives up prices;
• Industries like cabinetmaking need, creating new pressure to wildlife habitat;
• Stored carbon for decades or centuries, mitigating climate change.

USDA has put the cart way out in front of the horse. With good reason our national look-before-you leap law, the National Environmental Policy Act, requires federal agencies to review the potential impacts of such programs, and consider how best to administer them, before making such investments. Why hasn’t USDA done so? The agency says it has no choice but to fund all comers who ask for CHST money. That couldn’t be more wrong. The statute says USDA “may provide matching payments.” If there is discretion about what to pay for, there’s discretion to pay only for biomass that is in the public interest. Instead, the agency has opened up the trough and filled it to the brim, blind to the consequences. And a nation staggering under debt will soon be billions more in the hole.

Now that’s horrid.

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