Business is booming down on the farm for corn producer Steve Cryer.

“Obviously the interest in ethanol, whether it be from corn or milo (sorghum) or cellulosic … all of those I can’t see anything but good for the farmer,” said Cryer, who owns a farm south of Keyes, Okla., in the Oklahoma Panhandle. “ … For years we’ve needed something to prop up our commodity prices. They’re too cheap in my opinion.”

Cryer is one of many corn farmers in the country benefiting from high corn prices boosted by the demand for corn to produce ethanol, an alternative energy source.

U.S. Rep. Frank Lucas, in an attempt to create more booming businesses, proposed House Resolution 2261 in Congress that would provide tax credits and incentives to start the production of cellulosic ethanol and harness more wind energy in rural America.

“The primary goal is to make it possible for rural areas to play a bigger role in energy,” said Lucas, a farmer and cattle rancher. “ … If we start down this trail with alternative energy I think we will be better off for it.”



Renewed Energy

Ethanol is a national buzzword that is starting to take shape in Oklahoma. It's an alcohol generated by renewable resources, such as corn, that can be combined with gasoline to produce fuel for vehicles. There is one ethanol plant in the state and a few others slated to come on board.

Lucas, a Republican from Oklahoma’s 3rd Congressional District, said the corn used in ethanol production and as feed for cattle is not what we tend to see on our tables. He said the corn can be eaten, but what we typically choose is a sweet corn.

Corn production is minimal in Oklahoma and in parts of the state, like in the Panhandle, irrigation systems are needed to grow the product. Eastern Oklahoma receives enough moisture to grow the crop without irrigation.

At the Cryer farm, 3,000 acres of corn are irrigated, mostly to feed cattle in area feedlots.

But if ethanol plants start popping up feedlots and ethanol plants may be competing for his corn, Cryer said.

The demand for corn for ethanol production has spurred higher prices for feed for livestock, something Lucas would like to reduce through a push for cellulosic ethanol. This type of ethanol would use non-food plants, like switchgrass and wheat straw, to convert into ethanol.

“Cellulosic ethanol is where Oklahoma will have the advantage,” said Clayton Robinson, energy program manager for the Department of Commerce’s Office of Community Development.

Corn takes a lot of water to cultivate, but crops like switchgrass can grow in dry environments and already grow naturally in parts of Oklahoma.

In House Resolution 2261, Lucas is proposing a one-year transitional payment for farmers taking the leap to begin growing cellulosic ethanol products. He wants to set aside $4 million a year for about five years to provide for farmers because it takes about a year and a half to harvest the new crop. He said it is important they are earning money to be able to feed their families while growing a new crop.

The bill also calls for a study by the Department of Energy on how to get ethanol through pipelines and out to the customer. He said the current fuel pipelines will corrode if ethanol passes through them.

Lucas, ranking member of the U.S. House Agriculture Subcommittee on Conservation, Credit, Energy and Research, hopes the agriculture portions of his bill will be written in this year's new Farm Bill. He hopes the remaining points will go in separate bills or as part of other legislation.

Vaughn Clark, director of the Office of Community Development at the Oklahoma Department of Commerce, is confident the idea of alternative energy is here to stay.

“I think with all renewable energy there is a need to build public acceptance and public confidence that these are indeed resources that are equal to the fossil fuels,” he said. “I think the high gas prices have allowed more people to take a look at well, ‘if gas is going to stay this high what are my options now?’”







Optional ending, pick up credit line at bottom









‘Blowin’ in the Wind’

“Wind has pretty much been the driving factor in Oklahoma,” Clark said.

Oklahoma is ranked number eight in the country in wind energy potential, according to the American Wind Energy Association.

The state's first wind farm was built in Woodward County in Northwest Oklahoma in late 2003. Since then, a handful of other wind farms have popped up, including one in neighboring Harper County, to utilize the wind that comes sweeping down the Plains.

Wind energy now accounts for about 3 percent of the state’s energy resources, Robinson said.

But he believes the opportunities for wind energy are endless.

He said if the wind in western Oklahoma was fully utilized it has the potential to meet the needs of Oklahoma and many parts of the rest of the country, at least big cities surrounding Oklahoma. Robinson said, however, that wind is not intended to be the sole provider of energy, but to work in conjunction with other sources.

Stringing enough transmission lines for wind energy is a major obstacle, said Steve Stengel, spokesman for FPL Energy, a Florida company that operates two of Oklahoma’s wind farms.

“It doesn’t matter what part of the country, transmission is always an issue,” he said.

The transmission lines are like water hoses, he said - there is only so much water that can go through a hose. In this case, there is only so much energy a transmission line can hold. In many parts of the country, the transmission lines are fully loaded and cannot hold any additional power.

Cost is also a factor in getting more wind farms built in the state as well as individual wind turbines at homes, farms and small businesses.

Lucas is pushing to provide financial relief to those wanting to invest in wind energy.

In his bill, Lucas aims to extend the federal production tax credits of 1.9 cents per kilowatt generated by wind turbines for five-year terms instead of one or two years as in the past.

“It’s a subtle change in the law that I think will dramatically enhance the number who want to participate,” Lucas said.

Stengel said when it came to the federal credits it was always a boom/bust cycle because the wind energy business would do well while the tax credit was in effect, but once it expired work would come to a halt. He said the tax credits have been effective, but a longer-term credit will provide more certainty.

Lucas also hopes to address small wind turbines that can be used at homes, farms and small businesses. He hopes to provide $1,500 per half a kilowatt for these small units that can accommodate between two and 10 kilowatts.

Oklahoma lawmakers are pushing for a similar state law that could provide up to a 40 percent state tax credit on the purchase and installation costs of a small wind unit or solar energy unit, as well as a sales tax exemption on the equipment.

“Oklahoma has a long, rich history of being an energy state. Obviously fossil fuels aren’t going to last forever,” said Oklahoma Rep. Randy Terrill, R-Moore. “Hopefully Oklahoma can help lead the way with another energy boom, but it wouldn’t be in the traditional way.”

The Oklahoma Legislature adjourns May 25 and Terrill’s bill, House Bill 1387, is still competing against other tax items. Money for the tax credit was not included in a comprehensive bill the governor and legislative leaders agreed to May 15.

Mike Bergey said the potential for the tax credit at the state level is “modest at best.” He is the president of Bergey Windpower Company of Norman, Okla., which sells small wind turbines for home, farm and small business use. He does not sell any units in Oklahoma right now because of the cost - $40,000 to $50,000.

“We don’t sell any in Oklahoma because it would take more than 20 years to pay off,” he said, noting that people will not purchase the units without tax credits to pick up some of the bill. “Small wind is one of the very few technologies with very little federal support … small wind should be given a fair shake.”



Jaclyn Houghton is CNHI News Service Oklahoma reporter.