Can federal research efforts focus on technologies applicable for smaller facilities? What would such research look like? This is a key chal­lenge for researchers and policy makers. Engineering economies of scale do exist, as do management and marketing economies of scale. However, there are technologies that lend themselves more to modular expansion. Tech­nologies should as much as possible allow the farmer to capture the value added from storing, preprocessing, and perhaps even processing the crop on site.

In the late 1970s, the DOE launched its wind energy initiative. Wind energy has dramatic economies of scale. The power output varies by the square of the diameter of the turbine’s blades and by the cube of the increase in the wind speed. The DOE focused on building very large — diameter wind turbines. These megaturbines contributed relatively little to the technological advances in the wind energy field. Much more impor­tant for wind energy development was the design of buyback tariff struc­tures in California in the early 1980s and the wind energy mandate in Minnesota in the mid-1990s.

As the wind energy industry grew, advances in the electronics and construction design of wind turbines grew even more rapidly. As they did, wind turbines became larger in a more organic way, moving from the 200-kW machines of the early 1980s to the 750-kW machines of the late 1990s to the new 1.5-MW machines.

In 2001, the DOE launched a small wind turbine initiative. The objec­tive was to make wind energy economical in the many areas of the country that have lower wind speeds. This initiative is a 180° turn from the wind energy program of the late 1970s. It is too early to evaluate its results.

Regarding biomass, the DOE favors larger facilities, again because of their engineering economies of scale. The biomass program’s orientation to the scale of production systems mirrors that of the fossil fuel and nuclear programs. Yet biomass has characteristics that may lend itself to a different orientation. The cost of transporting biomass, e. g., is much higher than the cost of transporting fossil fuels or uranium. In addition, the farmer-ori­ented and rural economy objectives of the biomass program are not part of the fossil fuel or nuclear development program.

Both DOE and the Department of Agriculture are conducting research in biochemical production. How would a focus on smaller scale and modu­lar production units affect the research done under these programs?

The DOE and, to a lesser extent, the Department of Agriculture, have largely ignored questions of scale and ownership in their R&D efforts. The result could be that success in dramatically increasing the use of biomass for energy and industrial purposes may well not translate into higher farmer income or healthier rural communities. Yet these are formal objectives of both agencies’ missions. Taking these socioeconomic factors into account could well encourage a different R&D and commercialization strategy by the federal agencies in charge of the biomass program.

Notes

1. Catherine E. Woteki, Deputy Undersecretary, Research, Education and Economics, USDA, Testimony Before the House Agriculture Committee, Resource Conservation, Research and Forestry Subcom­mittee, May 14, 1996.

2. Achievements in Agricultural Utilization Research, ARS Committee on Research Achievements, ARS, Washington, DC, November 1966.

The same 25-yr period, 1941-1966 was examined in a PhD thesis at the University of Georgia by Harold B. Jones, Jr., of the USDA’s Economic Research Service. He found that by 1966, 9% of the projects undertaken by the regional laboratories had produced an economic return. That figure compared favorably with returns on food indus­try research. The cost-benefit ratio was 20 to 1 or better (cited in Always Something New: A Cavalcade of Scientific Discovery, USDA, Agricultural Research Service, Miscellaneous Publication 1507. November 1993).

3. Fred C. White, B. R. Eddleman, Joseph Purcell, et al, "Nature and Flow of Benefits from Ag-Food Research," in An Assessment of the United States Food and Agricultural Research System. Volume 2. Com­missioned Papers, IR-6 Information Report No. 5. Office of Technol­ogy Assessment, Washington, DC, December 1980, pp. vii-x.

4. Speech by Senator John F. Kennedy at the National Plowing Contest, Sioux Falls, SD, September 22, 1960.

5. David M. Russo and Edward McLaughlin, Farmers Can Get Bigger Share of Food Dollar. New York State College of Agriculture and Life Sciences, Cornell University, April 1991, estimates the retail price of corn flakes at $1.56 per 18-oz box. Corn represents about 10£ of the cost. The Economic Research Service, in Food Marketing and Price Spreads: Farm-to-Retail Price Spreads for Individual Food Items (2003) Washington, DC, estimated the year 2000 cost of an 18-oz box of corn flakes to be $2.14, with corn flakes representing 8£ of that cost.

6. Biomass RoadMap. Biomass Research and Development Technical Advisory Committee, Washington, DC, November 2002.

7. Personal communication from several ethanol plant managers in Minnesota. Also see Van Dyne, D. L., Employment and Economic Ben­efits of Ethanol Production in Missouri. Department of Agricultural Economics, University of Missouri-Columbia, February 2002.