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Biofuel Economics: North Dakota’s Relative Biomass Potential

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Cole Gustafson, NDSU Biofuels Economist Cole Gustafson, NDSU Biofuels Economist
North Dakota often is viewed as the state with the the greatest potential for biomass production.

By Cole Gustafson, Biofuels Economist

NDSU Extension Service

Throughout the year, various colleagues across campus provide updates on their research activities. Before Thanksgiving, Scott Pryor, NDSU assistant professor in Agricultural and Biosystems Engineering, presented a seminar describing the opportunities and limitations of the biofuel industry. I was especially struck by his views of North Dakota’s biomass potential.

Across the country, North Dakota often is viewed as the state with the the greatest potential for biomass production. This perception has been fostered since 2005, when the National Renewable Energy Lab (NREL) released its national biomass inventory study. A map summarizing the study’s results shows that counties in the eastern two-thirds of the state have the potential to provide between 250,000 and 500,000 metric tons per year and several counties have potential greater than 500,000 metric tons annually.

Pryor challenged this view by noting that counties across North Dakota typically are larger in size than counties in other states. Therefore, the inventory may not be reflective of actual relative potential. This is especially important with respect to the development of the biomass industry. Biomass is a bulky material and therefore transportation costs likely are to be a key economic determinant. Even though North Dakota may produce a large quantity of biomass, transportation costs may erode the state’s potential if the production is not concentrated.

Instead of solely evaluating potential across counties, Pryor shared another less well-known NREL map that illustrated geographic biomass potential by counties, but was adjusted or normalized for county size. Therefore, biomass potential for large counties, such as those in North Dakota, were divided by average county size.

The results were striking. While North Dakota still has greater biomass production potential than three-fourths of the other states, it no longer has the highest relative potential. The same impact is even more pronounced in the very large desert counties of southern California and Arizona. Illinois, Iowa and southern Minnesota have the greatest potential to produce biomass on a per- acre basis. This isn’t surprising given the high productivity of soils in the Corn Belt. The higher density of biomass production in these regions would reduce transportation costs and be an important comparative advantage in industry development.

Pryor presented one last analysis to shed more light on North Dakota’s role in the developing bioeconomy.

"North Dakota's real advantage in terms of the biobased economy is an unlikely one: its population," Pryor says. "By evaluating biomass potential on a per-capita basis, North Dakota once again has the potential to be a leader in biomass production. This map shows that North Dakota, especially the eastern portion, has greater potential (measured in biomass production per person) than any other region in the country.”

Pryor notes that public investment from developing the biomass industry in North Dakota would offer the highest return on investment.

In his conclusion, Pryor said he felt that the concentration of biomass in the state likely is sufficient to support cellulosic processing plants. Even though Corn Belt states will likely produce larger total volumes of biomass than our state, the positive economic impact of the industry would be felt more strongly here.

Biomass resource maps are available at http://www.nrel.gov/gis/biomass.html.


NDSU Agriculture Communication

Source:Cole Gustafson, (701) 231-7096, cole.gustafson@ndsu.edu
Editor:Rich Mattern, (701) 231-6136, richard.mattern@ndsu.edu
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