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Investigating Crop Insurance for Biofuel Sources

Posted by Debbie Haugan, Risk Management Agency Public Affairs specialist in Energy Rural
Feb 25, 2011

Energy crops have tremendous potential to reduce our dependence on foreign oil and create jobs in rural America.  USDA’s Risk Management Agency is expanding its efforts to see if new insurance products can be developed for the producers of these renewable, clean energy crops that are grown right here in America.

The Energy Independence and Security Act of 2007 established that a mandate that this country’s use of renewable transportation fuels reach 36 billion gallons by 2022.  Of that, 20 billion gallons are targeted to come from second generation biofuel sources, including switchgrass, energy cane, woody biomass and other feedstocks. The Act encouraged biofuels research and development.

The Risk Management Agency will soon solicit for studies of the feasibility of developing crop insurance products on potential biofuels sources. These projects join research already underway for energy cane, switchgrass and camelina produced as a biofuel feedstock.

For the first study, RMA will be seeking research on the viability of developing a crop insurance product for crop residues such as corn stover (which consists of leaves and stalks of corn plants left in a field after harvest) and straw as a biofuel feedstock.

Under another study, RMA will be seeking research on woody biomass, which includes limbs, tops, needles, leaves, and other woody parts of trees and woody plants that are the by-products of forest management.  The study will analyze the types of woody biomass currently in production which could be used as a potential for biofuel feedstock.  A related study will also investigate the feasibility of developing a crop insurance product for poplar and willow trees, fast growing trees grown as a biofuel feedstock.

Solicitation for each study will remain open for 60 days.  Those interested in submitting a proposal should watch FedBizOpps or RMA’s website over the next few weeks.

Category/Topic: Energy Rural