Research shows ethanol expansion has reduced cover cropping incentives
A newly published study in Applied Economic Perspectives and Policy, co-authored by a researcher at NDSU’s Center for Agricultural Policy and Trade Studies, finds that the surge in U.S. corn ethanol production following the Renewable Fuel Standard has unintentionally slowed the adoption of winter cover crops, an important conservation practice for soil health and carbon sequestration.
Drawing on satellite imagery and detailed maps of ethanol plant capacity from 2006-2015, the authors estimate that building a single 100-million-gallon ethanol refinery reduces local cover cropped acreage by 0.35 percentage points, about 857 acres in a typical county cluster.
Regional Impact
Simulating a counterfactual in which ethanol capacity remained at 2005 levels, the study finds 570,000 “missing” cover cropped acres in 2015, concentrated in northern Iowa and Illinois. That lost acreage represents roughly 100,000 metric tons of foregone annual CO₂ equivalent sequestration, comparable to taking 22,000 cars off the road.
Policy Implications
The authors suggest that next generation fuel credits, such as the federal 45Z tax incentive for sustainable aviation fuel, could require documented soil carbon practices to ensure biofuel demand dovetails with climate smart agriculture goals.
For additional information, contact Matthew Gammans at matthew.gammans@ndsu.edu.