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Greening Rural Minnesota, One Acre at a Time

May 05, 2011 By Lee Egerstrom, Economic Development Fellow

Thanks to an entrepreneurial spirit, innovation, cooperation and state funded research assistance, Minnesota farmers are working around obstacles in new and creative ways to help improve alternative energy prospects.

By midsummer, crews will begin digging new foundations at the Minnesota Valley Alfalfa Producers (MnVAP) cooperative’s Raymond plant to expand production into biofuels.

This will move MnVAP beyond its current operation—making concentrated alfalfa feed pellets for livestock—and back to the co-op’s original purpose of producing energy from rural resources, said Keith Poier, a Chippewa County farmer near Glueck and a MnVAP board member.

It’s also helping farmers keep up or stay ahead of the “explosive” green energy movement, develop more value-added products and services, and keep more Minnesota-generated wealth in local communities, said Bruce Stockman, project development director for Minnesota’s Agricultural Utilization and Research Institute (AURI).

There are projects all over the state where local people are looking at agricultural commodities and processing wastes for making more efficient biofuels, find better systems and start new biomass and biofuel companies, said Stockman, a former head of the Minnesota Corn Growers Association.

Stockman and scientists working for AURI don’t openly discuss many of these projects because the state R&D agency works on applied research to help entrepreneurs with proprietary product development and systems as well as business planning.

But it is noted here for reasons all Minnesotans should recognize.

State support for AURI has survived despite woeful state revenue and budget problems. The only departmental budget bill approved by the Minnesota Legislature and signed into law by Governor Dayton to date is the biennial budget package for the Minnesota Department of Agriculture, the Board of Animal Health (BAH), AURI and related agricultural, food and nutrition programs.

AURI and the state department survived with only a five percent cut from existing state support—a retreat, for sure. But it is manageable, according to Minnesota Agriculture Commissioner Dave Frederickson’s op-ed sent to weekly newspapers. In that column, Frederickson noted the governor said the bipartisan ag budget should serve as a model for resolving other state budget problems.

That doesn’t appear to be happening. But it still should serve as a reminder that when it comes to providing efficient public services, we Minnesotans do get what we pay for. Raymond and West-Central Minnesota provide useful reminders of this.

Poier recalls that MnVAP was started at Granite Falls in 1996 in the midst of an explosion of what have become known as New Generation Cooperatives (NGCs). These business ventures weren’t merely formed to overcome some market problem for their members. Rather, they were offensive business structures aimed at returning more of the ultimate value of area crops to member farmers and their local economies.

The original MnVAP set up operations at Raymond, west of Willmar, and has since located its business offices there as well. Initially, the plan was to strip alfalfa leaves from the plants, use the nutritious leaves for animal feed, and use the plant stems to generate energy.

“If we knew then what we know now, we would have had a different business plan,” said Poier. But the 140 farmer-owners' company has survived 15 years making high-value and easily and efficiently transported animal feed that it ships throughout the nation, to Puerto Rico, and to Mexico.

AURI scientists have since helped MnVAP develop a system for making condensed biomass into fuel pellets, which will use the stalks from plants grown by co-op members and nearby farmers, and other biomass materials. Some of this will be useful for home heating, he said, but the co-op is targeting institutions and larger businesses with boiler systems for their customer base.

“There are some real creative things going on in communities that will help keep this as a local and growing fuel source,” Poier said.

With federal and/or state grant help, places like Franklin are building boiler systems to provide energy for public buildings. The Kerkhoven-Murdock-Sunburg school district has just installed a biomass boiler system at an elementary school in Murdock. An extremely creative ethanol plant and vodka distillery cooperative at Benson is experimenting and developing processes to use stover crops for energy development.

In other rural renewable energy development sectors, farmers near Sunburg and Pennock plan to install another large Minnesota wind farm along the glacial ridge. Project founders are structuring a company that aims to benefit landowners hosting these power generating windmills, according to Bev Ahlquist’s April 27th report in the Kerkhoven Banner. Like many of Minnesota’s original ethanol companies, founders of what has been named Whirlwind Energy LLC are locally based, with profits recycled and taxes paid in the local communities.

Also nearby, the University of Minnesota campus at Morris has pilot projects and development technology projects underway that show community leaders and farmers what more they might do, said MnVAP’s Poier. Most of the Minnesota Morris budget for experimental and developmental research comes from the state’s higher education budget, however, and not the already tended-to agricultural budget.

Rural Minnesota’s future success lies not only in its farmers’ entrepreneurial spirit but in U of M scientists’ innovation, AURI’s applied research, and other publically funded brain capital. Achieving this prosperous rural economy won't happen by taking an unbalanced budget approach that seeks to keep taxes low for a few while defunding assets that have helped Minnesota achieve tremendous market advantages.

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