U.S. Renewable Fuel Standard incentivizes land use change with environmental consequences

Corn field

In order to address global climate change, the U.S. Renewable Fuel Standard (RFS) aims to increase the use of biofuel in order to reduce greenhouse gas emissions. According to a new study by Tyler Lark of UW-Madison and co-authors, including several members of Grassland 2.0, the RFS may have missed the mark in reducing emissions – in fact, the greenhouse gases produced consequentially negate any advantages of corn ethanol over gasoline. Why? The RFS policy makers did not predict the full-scale impacts of the land use change that would result from its implementation – mainly more corn and less pasture.

Eric Booth at the UW Arboretum in Overlook Prairie. Eric is a part of the Grassland 2.0 modeling team and a co-author on the recently released paper examining the impact of the RFS.

“Any time you drive up demand for commodity crops like corn and soybeans, you’re going to stimulate more of those crops on our landscapes,” says Lark. “Alternatively, policies that support grassland-based agriculture could help sustain our rural economies while also enhancing carbon sequestration, water quality, and wildlife habitat.”

Using empirical and explanatory modeling, the study found that during the first eight years of the policy’s implementation (2008 to 2016), the RFS led to a 31 percent increase in corn prices. This increase spilled over to other crops, driving a 19 percent increase in soybean prices and a 20 percent increase in wheat prices. The result?  Incentives to plant more corn, to grow more continuous corn, and to devote more land to cropland. RFS incentivized corn and disincentivized grasslands, such as land enrolled in the Conservation Reserve Program (CRP) and pasture.

The increase in corn production correlated with a 3-8 percent increase in annual fertilizer use, which, in turn, increased water pollutants by 3-5 percent. As Virginia Gewin points out in her recent piece in Civil Eats, the transition to more corn and less grassland also means less carbon storage on the landscape. Research from Grassland 2.0 has demonstrated that grassland and well-managed pasture store more carbon than annual row crops, thereby helping to mitigate climate change.

“One of the main arguments for the RFS at its inception was its potential to reduce greenhouse gas emissions,” notes Eric Booth, an Associate Scientists and Lecturer at UW-Madison.  Booth is a co-author on the paper and a member of the grassland modeling team of Grassland 2.0. “Unfortunately, as some initial critics suspected, the conversion of grassland to cropland spurred by the RFS led to more soil carbon loss and additional corn acres requiring high levels of nitrogen fertilizer released even more greenhouse gases. On top of that, land converted to crops, which tended to be more marginal, is much more susceptible to erosion and nutrient loss. Our models, grounded in real-world observations, were able to capture these important processes,” notes Booth.

These findings add to the discussion over the types of public policy needed to support our food, energy and water needs and provides critical evidence that policy incentivizing perennial grassland such as well-managed pasture can be a critical step to reducing greenhouse gases while meeting those needs.

These findings are timely as the Environmental Protection Agency (EPA) will propose updated RFS requirements in May. As Lark notes, “decisions made this year have the potential to impact our climate and landscape for decades to come.”