Innovation. Cooperation. Sustainability.
Organic Valley Farm, LaFarge, Wisconsin
. Renewable Energy Tour Looks at Local Projects by Katy Phillips, Communications Director, Wisconsin Farmers Union
“My story is no exception. Our area of northern Germany counts thousands of farmers like me: energy entrepreneurs who joined forces with local residents to build cooperative, sustainable businesses that produce renewable energy and value added jobs. From the bottom up we have transformed the way our area produces energy. Currently, more than 40% of our electricity is generated from sources such as wind, biomass and the sun.” — Dirk Ketelsen, German farmer
This is how one German farmer describes the current reality for mid-sized farms in his country, but it also can describe a future reality for Wisconsin farmers. Exploring this vision was the primary reason that the Wisconsin Farmers Union co-hosted a Renewable Energy Tour last summer.
Farmers Union partnered with the Heinrich Böll Foundation on this tour, with support from the Energy Foundation, and gathered some fifty or so farmers, state and federal agency staff, interested citizens, and media for a day long tour of renewable energy projects. We rented a hybrid, biodiesel school bus, hosted German farmer Dirk Ketelsen as a special guest speaker, and spent a day visiting innovative energy projects. We also had frank discussions with policy makers about how the United States is lagging behind in supporting renewable energy innovation, and how Wisconsin can position itself to become a leader in this area.
Dirk Ketelsen – Our German Farmer Guest
Dirk is a farmer from Schleswig-Holstein in rural northern Germany, and while our bus rolled though the hills of SW Wisconsin he described how he, and other farmers, worked cooperatively to connect their farms into a profitable, locally based renewable energy system. Dirk explained how he transitioned his farm through the ups and downs of conventional farming, into using organic practices, and then into a significant focus on harvesting renewable energy. People now call him an energy farmer.
Dirk pointed out that German renewable energy projects had to overcome local skepticism, much as we do in Wisconsin, and find a way to demonstrate a broad community benefit. Building his community’s first wind turbine, for example, required a strong base of community leadership to organize a cooperative wind farm, where the neighbors were investors and the whole community benefited from the energy harvested.
Building this type of cooperative framework was not easy. Community-scale energy development required an effort to address complex regulatory and market rules, meet requirements for siting and grid connection, manage unpredictable rates of return and balance diverse investment models – all while protecting local interests.
Fortunately, in 1990, the German government introduced the Clean Contracts system that supported small, cooperatively based “energy farmers” like Dirk. Clean Contracts required utilities to connect their wind turbines to the grid and fixed a price for every kWh – and guaranteed a power purchase agreement that would last for 20 years. This was the breakthrough that enabled local energy systems to calculate a stable rate of return, develop long-term business models, and attract a diverse base of investors.
Since 1990, Clean Contracts has enabled Germany to generate 16.8% of its power from renewable energy and has created 370,000 jobs (for a country with an approximate population of 82 million vs. the U.S. approximate population of 309 million). And while the German energy market is dominated by four major utility companies, investments by family farmers, local residents, rural coops, and municipal utilities, account for 96% of investments in renewable energy projects.
Dirk Ketelsen is now one of 200,000 German farmers who have become energy producers. This is a remarkable model of innovation, sustainability, and cooperation within communities (along with support from government policies) that has been a game-changing, profitable venture for family farms and rural communities.
Organic Valley Family of Farms
Located in LaFarge, Wisconsin, Organic Valley is a farmer-owned cooperative, founded in 1988. Organic Valley began by marketing vegetables and then added organic dairy products and meats. With 1,636 current owners, it is the largest organic farmer-owned cooperative in North America with $600 million in annual sales in 2010.
Organic Valley works within a “triple bottom line” of sustainability: social responsibility – how they affect their employees, customers and communities; ecological integrity – how their operations affect the world and its resources; and Economic stability – how they make, spend, and save money.
Organic Valley is now applying these cooperative principles in the development of an innovative On-Farm Biodiesel Program that is assisting their members in production and processing of sustainable bio-fuels. The program supports farmers in every stage of bio-fuels development – from initial planting of an oilseed crop to the processing and utilizing of the final biodiesel product. To cut costs and increase efficiency, the program provides a mobile oilseed processing unit that can press oil from several neighboring farms. The program provides technical assistance in adapting farm tractors to utilize either a straight oilseed product or a blended petro-diesel, avoiding the need for complicated and expensive further processing.
The Organic Valley Bio-diesel Program allows farmers to meet their needs for both fuel and feed. The pressing of seed crops grown on the farm provides both oil for use in fuel and a high protein feed meal for livestock. While still in the pilot stage, the program estimates that by planting as little as 10% of their tillable land base with an oilseed (e.g. sunflowers, soybeans, or camelina), farmers can produce a large percentage of their farm’s fuel and protein demand. The program estimates yields of 80-100 gallons of biofuel oil, and between 1200-1500 pounds of feed meal per acre. Initial research shows that it is possible for a 50 cow dairy to produce 70% of its fuel and over half of its protein needs on 15-17 acres. The program goal is “feed and fuel, produced in one process, from the same field.”
We also learned about several other Organic Valley renewable energy initiatives, including development of smaller scale manure digesters, use of solar photovoltaic panels at the headquarters facility in La Farge, and a continuing effort to incorporate wind energy development at their distribution center.
Organic Valley’s energy programs are designed to provide farmers with many of the same opportunities achieved by German farmers. Most importantly, their programs are provided within their larger cooperative mission, assuring that benefits are retained by their members.
Located in the beautiful hills of Soldiers Grove, Wisconsin, Driftless Organics farm is owned and operated by Josh and Noah Engel and business partner Mike Lind. Josh and Noah grew up working on their parents’ organic dairy farm, realized they had an even larger passion for growing organic vegetables, and now operate over 100 acres of organic vegetables, fruits, small grains, sunflowers, and grass fed cattle.
Driftless Organics operates as a Community Supported Agriculture (CSA) farm, with 600 consumer members purchasing an annual “share” in each year’s crop. CSA farms are one of the fastest growing agricultural sectors, reflecting consumer interest in the “know your food, know your farmer” concept. Driftless Organics markets to both Madison and Chicago, has annual revenues of over $2.5 million, and employs a seasonal staff of approximately 10 to 19.
Driftless Organics also grows and processes sunflowers for bio-fuel use in their primary seasonal tractor. They plan to transition additional farm vehicles and equipment to run on their vegetable fuel. They also select the best food grade sunflower seeds and process them into a high value, branded gourmet cooking oil that is marketed regionally.
Virent Energy Systems
Based in Madison, Wisconsin, Virent Energy Systems is developing an innovative biofuels technology that transforms many different soluble plant sugars from biomass into hydrocarbons that blend readily with gasoline, jet, and diesel fuel. It offers the potential for a high-performance, energy-efficient, cost-effective, and environmentally sustainable breakthrough in fuel technology.
Virent’s goal is to develop a technology that can directly convert biomass into a plant based substitute for conventional fuels, with a focus on using non-food plant materials as the primary feed stock. They expect this technology will avoid the “food versus fuel” issues that are raised by expansion of bio-fuels processes that rely on corn or other food crops. Virent’s approach will use large quantities of corn stover or woody forest materials to supply the biomass needed to produce fuels. Farmers would benefit from having a market for crop or forest residue and the harvest of other biomass materials.
Wisconsin Farmers Union’s mission is to advocate for policies and development initiatives that support family farms and rural communities. The experience of German farmers in establishing locally based energy production demonstrates the potential for a new cooperative development model for U.S. farmers. We don’t have to accept our current system as energy consumers. We can create an energy policy that keeps wealth within our communities, fosters local entrepreneurship and cooperation, and supports diversified farming practices. But it will require a commitment to new energy policies and investment tools, and a willingness to learn from the hands-on experiences of our neighbors and businesses that are already exploring the path.
Wisconsin Farmers Union and the Heinrich Böll Foundation are planning another Energy Tour this June. Visit our website to check for the date and details: www.wisconsinfarmersunion.com.