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POET Sends Out Harvest Payments

By Staff | Jun 22, 2010

Farmers who signed contracts with POET to harvest biomass were sent advance checks this month totaling more than $111,000, the first round of payments from the U.S. Department of Energy in support of Project LIBERTY.

The harvest payments are designed to help cover “variable costs” for the new operations, things like equipment purchases, biomass transport and other such items.

“It’s really exciting,” Project LIBERTY Director Jim Sturdevant said. “We’ve been talking for a long time about how Washington wants to partner with farmers, but to finally be able to show that is really rewarding.”

These payments are in addition to another program that will match payments for delivered biomass. Final rules will be finished this summer for the Biomass Crop Assistance Program, administered through the U.S. Department of Agriculture.

“There is a strong push to get the cellulosic ethanol industry off the ground, and it’s great that farmers here get to be a part of that,” Sturdevant said.

POET today has commitments for about half of the 75,000 acres needed this year for the first commercial harvest for Project LIBERTY. By the time the plant is fully operational, POET plans to contract for 300,000-400,000 acres annually.

“The DOE wants this project to succeed so other facilities will follow, but there is a limited amount of money available,” said Alan Keller, POET Biomass’s regional manager. “We are telling farmers to get signed up to make sure they can be involved in this program and receive this funding.”

The 25 million-gallon-per-year Project LIBERTY will make ethanol from corn cobs and “high-cut” material – basically material that comes out the back of the combine during harvest. The rest will be left on the field for nutrient replacement, erosion control and other factors consistent with good farm management. Iowa State University is continuing research with POET to ensure farmers know how to best manage their land.

The first farm to contract with POET was Garrelts Livestock Feeders, LLP. Matt Garrelts said he and his father discussed the issue for about a week before deciding they wanted to be at the forefront of a new development in agriculture.

“It’s nice to be on the cutting edge of something,” he said.

Garrelts contracted to harvest corn cobs and high-cut material on 900 acres this fall in his first go-round, but he said he may up that number in future years after they see how things go.

He plans to use a process known as “second-pass baling” to harvest the material. In second-pass baling, the combine’s chopper is turned off during harvest, leaving a windrow in the field. Later, a baler collects the material.

In the future, Garrelts said, he might look at single-pass baling, which bales material as it comes out of the combine before it hits the ground.

He sees a lot of upside to the process and little downside in collecting what is basically a waste product.

“Cobs don’t really do much on the ground there,” he said. “They don’t build the soil.”

A couple factors helped make the decision easy, he said. Their farm is relatively close to the plant and government incentives will offset many startup costs for his operation.

“They (the government) obviously want this to work,” he said. “They want to add financial assistance to get this off and going, and I am glad to be on the cutting edge of something new in our country’s energy usage.”

POET is still talking to farmers to secure contracts for the remaining acres before the fall harvest. After signing a four-year contract to harvest biomass for POET, a farmer will then sign a contract for the harvest payments. Those payments and the contract can be adjusted on an annual basis to change the total acreage.

For information, contact Alan or Eric at POET Biomass in Emmetsburg (712) 852-4244.