Des Moines Register
02-28-07
Analyst: Biofuel industry makes $8.2 billion splash in Iowa
REGISTER STAFF WRITER
Iowa’s ethanol and biodiesel plants fuel an $8.2 billion economic impact that will
expand as improved technologies make the industry more efficient, renewable
fuels promoters said at an industry summit Wednesday.
The Iowa Renewable Fuels Association event in downtown Des Moines drew
about 400 people, including several plant owners and investors.
Ethanol and biodiesel plants have added $1.8 billion to household incomes,
created more than 53,000 jobs, and generated $387 million in state tax revenues,
according to the study done by John Urbanchuk, a director with LEGC, a
consulting and analysis firm in California.
The economic impact figures include construction, transportation, marketing and
other jobs that the biofuels industry supports.
Urbanchuk’s study included figures that far exceeded that of a prior year’s study,
although the two reports used different methods to measure the impact.
Monte Shaw, the association’s executive director, said he expected the figures to
be much higher because the industry has grown tremendously in the past year
and a half, and the price of corn and construction has increased.
Yet David Swenson, a research scientist at Iowa State University who has
studied the state’s renewable fuels industry, said the impact’s figures are inflated
because the study includes money that would have been there regardless of
ethanol.
“He 'creates’ 18,400 farm production jobs as a result. Those jobs were already
there, the farmers were already farming, their suppliers were already supplying,
and so on,” Swenson said. “Can’t have an impact on jobs that are already there.
That’s like counting last year’s savings as this year’s income.”
Urbanchuk’s study also included the impact of the construction of ethanol and
biodiesel plants, which he said was a one-time boost to the economy. The
analyst also offered projections on increased yields, which he said would grow by
about 7.4 percent for corn and 2.1 percent for soybeans by 2010.
Several presenters addressed skeptics’ questions of the industry, including
whether the nation can satisfy the expectations for both food and fuel and ease
the environmental effects of production. They also presented technologies that
would squeeze more fuel out of corn and soybeans, as well as make the process
more efficient, and, as a result, cheaper.
Rick Brehm, general manager of Lincolnway Energy in Nevada, offered
suggestions on recycling and reducing the amount of water used in the boiling
and cooling processes at ethanol plants.
“We want to be good stewards of the world’s natural resources,” he said.
David Winsness, president of GS CleanTech Corp. of New York City, discussed
his company’s technique in getting the oil derived from dry distillers grains —
basically what’s left of the corn once it’s used to make ethanol — and using it to
make biodiesel. The result would “more than double the gross profit” per bushel
of corn, he said.
Gov. Chet Culver canceled his plans to speak at the energy summit because he
was addressing power outages related to the winter storms.
Reporter Philip Brasher can be reached at (202) 906-8138 or
pbrasher@dmreg.com