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Farmers play a part in decarbonizing ethanol

A soil health expert in southeastern Iowa says farmers have a role to play in helping decarbonize the U.S. ethanol industry.

Mitchell Hora with Continuum Ag, a soil health intelligence company, says farmers can get rewarded for implementing conservation practices on the farm from their local ethanol plant.

“There’s a new scoreboard in agriculture. Right now, it’s being displayed with the GREET model. And we’ve reverse engineered it to know how the point system works and now, there could be a financial mechanism that rewards scoring points.”

Those points are used to calculate a carbon intensity score ethanol producers can use to make corn-ethanol a more attractive feedstock for Sustainable Aviation Fuel and could allow producers to qualify for new tax credits.

The Internal Revenue Service has yet to issue guidance for ethanol producers and farmers on how new Inflation Reduction Act tax credits will be implemented, but the U.S. Treasury Department is expected to issue guidance by next January.

Hora says farmers have an interest in being compensated for their conservation efforts, but the rules outlining the returns for farmers need more clarity.

“If there’s an equal share in these tax credits, there’s going to be more farmers brought to the table, because they’re going to be adequately incentivized to share the data.”

Continuum Ag offers a certificate for farmers who want to be compensated for low carbon intensity grain.

Hora was a speaker at the National Ethanol Conference in San Diego, California.