U.S. Department of Agriculture epub Trends in U.S. Agriculture’s Consumption and Production of Energy: Renewable Power, Shale Energy, and Cellulosic Biomass

This report examines recent trends in energy use in the agricultural sector and the extent to which farm businesses engage in on-farm energy production. A 2013 ERS report on energy consumption and production in agriculture focused on corn and soybean production for the biofuel market and farmer responses to rising energy prices. However, since then, increasing volume mandates for cellulosic biofuel in the Renewable Fuel Standard, as well as the shale energy revolution and the promulgation of the Clean Power Plan (CPP), have changed (or could change, in the case of CPP) agriculture’s energy use and production patterns. The study finds that a small but growing number of farms harvest cellulosic biomass. Also, while the shale revolution contributed to lowering natural gas and fuel prices, domestic fertilizer prices have not substantially diverged from global prices–even though natural gas remains the major production cost for fertilizer. Shale energy production has impacted enrollment in the Conservation Reserve Program (CRP); the study finds that between 2006 and 2013, CRP acreage in counties overlaying shale plays declined, on average, at a greater rate (32 percent) than in non-shale counties (22 percent). The impact of the CPP on farm electricity use is expected to be minor for most farm businesses, as electricity represents, on average, only 1 to 6 percent of their total production expenses.