Global warming, geopolitical instability, peak oil concerns and the instability of crude oil prices have greatly increased the sense of urgency with which governments now pursue renewable energy alternatives to fossil fuels.

To successfully harvest renewable energy, we must adopt public policy that first plants the seed of viable new technologies and, more importantly, nurtures their growth to full potential. As we look at supporting promising “new-generation” technologies such as cellulosic ethanol and the like, we must remain vigilant that we not—through neglect—undercut the solutions we already have at hand.

The 2002 Farm Bill stands as a prime example of what can be accomplished in planting seeds from which a renewable energy industry will grow. Prior to 2002, the domestic biodiesel industry was virtually non-existent. In an effort to spark the development of a renewable biofuels industry, Congress introduced producer incentives in the 2002 Farm Bill. Among them was a $1-per-gallon tax credit for biodiesel produced in the United States. The result was an astonishing growth in production as entrepreneurs and investors engaged to grow the industry to an estimated capacity of 250 million gallons with more than twice that in development by the end of 2006.

As with any new industry, such exponential expansion—albeit critical to its ultimate success—is not accomplished without substantial “growing pains.” The commodity markets upon which the industry relies for its feedstocks have responded with extreme volatility. Efforts to identify and develop more sustainable feedstocks (e.g., algae, jatropha, etc.) show great promise but require time and the application of resources to become available. In addition, lender requirements to finance capital investment in a new industry are understandably restrictive, particularly in a period of economic downturn and the disruption of financial markets such as we experienced in 2007. Finally, distribution infrastructure needs to be developed to make the product readily available to consumers.

These “growing pains” are not unlike those that will be experienced by any new renewable energy industry. Yet, Congress and other lawmakers now seem inclined to direct undivided attention to the “next best thing” in an “either/or” choice between biodiesel as a proven technology versus the promise of “next-generation” biofuels such as cellulosic ethanol. A sensible renewable energy policy instead requires that we choose both.

Having invested in the seed to create the biodiesel industry, Congress must now sustain the critical support needed to strengthen its foundation. Such support will include:

› Sustained, and perhaps additional, producer incentives to offset the cost of production during these initial market adjustments and the increased volatility of feedstock commodity
pricing

› Funding of research and development to identify and establish additional sustainable feedstocks

› Grants and loan guarantees to underwrite debt financing for the capital required to sustain growth of the industry

› Market incentives to establish biodiesel within present fuel distribution infrastructure as an alternative fuel source made available to consumers

While efforts to support “next-generation” biofuels such as cellulosic ethanol are appropriate, it must be remembered that these too will require substantial cultivation. It remains important, therefore, to make certain we offer each viable alternative sufficient support to allow its industry to grow and achieve its maximum yield. Only then can we be assured that the public’s investment in renewable energy is most effectively targeted to support the ultimate objective, which is the harvesting of renewable energy toward a more sustainable future for us all.

Jeff Pieterick is president of the Wisconsin Biodiesel Association and cofounder of North Prairie Productions LLC. Reach him at jpieterick@wibiodiesel.org or (877) 299-2435.