German biogas bankrupts dairy farmers (Der Spiegel)

Biogas Boom in Germany Leads to Modern-Day Land Grab

by Nils Klawitter, Der Spiegel, August 30, 2012

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Wind turbines near a new biogas plant in the German state of Lower Saxony.

Creating energy from corn once seemed like a revolutionary idea in Germany. But subsidies for the biogas industry have led to entire regions of the country being covered by the crop, and investors are eagerly waiting for local farmers' land to go for sale. Some of those farmers who lease their land say they have been "ruined."

Dairy farmer Renate Rahn has made it through a number of industry crises, including themad-cow disease scare of 2001 and the dramatic fall in milk prices in 2009. "But now we're being brought to our knees," she says.

Low milk prices aren't the only thing threatening her. Rahn lives near the Eider River in the northern German state of Schleswig-Holstein, where she is having an increasingly hard time finding affordable land to lease for grazing her cows and growing their feed. Over the past four years, the average cost of leasing a hectare (2.5 acres) of land has skyrocketed from €250 ($315) to over €600 per year.

She and her fellow dairy farmers just lost even more corn fields to biogas companies. The corn grown there won't be used to feed any cows. Instead, it will be sent to a reactor for refinement. The facility, which functions somewhat like a cow's stomach, will be fed chopped-up corn twice a day. The corn is transformed into gases in the dome of the reactor. Energy-rich methane is then channeled into a combined heat and power unit (CHP) and transformed into electricity.

While dairy farmers like Rahn are being threatened by the low prices that food discounters offer for their milk, the biogas producers have nothing to complain about. Germany's Renewable Energy Act (EEG) has subsidized the energy the biogas companies produce for 20 years.

Rahn is now forced to feed her cows soy meal from Brazil, which is constantly growing more expensive. She knows she will lose the battle over the raw materials, and she blames politicians for having "ruined us."

A Subsidized Gold Rush

The idea of processing foodstuffs into electricity was born when Germany's then-governing coalition was made up of the Social Democratic Party (SPD) and the Green Party between 1998 and 2005. It was eight years ago, in an age when farmers were being granted so-called "set-aside premiums" because of overproduction, and when renewable raw materials were being particularly promoted. Plans called for transforming Germany into a bio-wonderland by peppering it with numerous small eco-power plants. What resulted was a revolution in the fields, a subsidized gold rush -- and an ecological disaster.

An average-sized biogas facility requires 200 hectares of corn, and needs to be constantly fed. This hunger for corn has transformed the German landscape. Schleswig-Holstein used to be famous as the "land of horizons," but now walls of corn dominate the landscape from north to south. The same holds true in the roughly 160-kilometer (100-mile) stretch of land between Münster and Bremen, in Upper Swabia and in the low mountain ranges of the western Eifel region.

Corn is now being grown on 810,000 hectares in Germany, which is equivalent to half of the area of the eastern state of Thuringia. In 2011 alone, the increase in the amount of land used to grow corn was almost equivalent to the size of the southwestern state of Saarland -- with horrific consequences. For the first time in 25 years, Germany couldn't produce enough grain to meet its own needs.

'Energy Corn'

When asked whether farmland should be used to make food or fuel, Joachim Rukwied said last week: "We can do both." But the new president of the German Farmers' Association (DBV) might be wrong. Feed corn has even had to be imported to meet the needs of the large-scale chicken farms in Lower Saxony because the fields are now being used for what is known as "energy corn."

Unlike in the general debate surrounding biofuels, growing so-called energy crops in Germany isn't necessarily a food-or-fuel issue. The corn isn't processed into fuel, and not much of the corn is grown for human consumption.

But the ongoing run on fields is leading to a scarcity of land for farming and grazing, and crops like potatoes are getting more expensive. Now there are farms used for growing energy crops right next to ones used for raising livestock. Indeed, it's become a duel between power lines and feed troughs.

Take the case of the Hohenwestedt, a small village in Schleswig-Holstein near the town of Rendsburg. There, people were jockeying to get hold of a deceased farmer's fields even before he was buried, says Christoph Lutze, a local dairy farmer. And he isn't the only one telling such stories. He's worried about losing the land he leases, about the "modern robber barons" who are eagerly searching for useable land.

For some time now, it hasn't just been farmers who are getting into the energy business. The investors have names like AgriKultur, Deutsche Biogas and KTG Agrar. These are companies that get hundreds of millions of euros from the Bremer Landesbank, a state-owned bank with branch offices in Bremen and Oldenburg, and that often only need the farmers as front men. In other words, they use them to minimize complications associated with building plants close to farms.

Lutze, the dairy farmer, recently locked horns with a new investor who had taken up residence in a posh new home nearby. Although he worked as a bankruptcy trustee, he had started investing in corn used for energy on the side, and he had also purchased some fields that Lutze had signed a lease for until 2013. For years, Lutze had been using the damp, low-lying grasslands as a source of fodder for his cows.

The area in question wasn't supposed to be cultivated without providing Lutze with compensation. But, Lutze says: "All of a sudden, they came with laser-guided drainage machines, dug into the ground and laid pipes." All of this was for drainage, he explains, to prepare for growing corn in the same way that the surrounding fields had already been prepared for corn monoculture. The investor had claimed that Lutze allowed the soil quality of the fields to degenerate. But even he couldn't explain exactly what that was supposed to mean when it comes to meadows. So, in the end, he provided Lutze with compensation.

Abandoning Crop Rotation

Crop rotation is viewed as a standard element of good farming practice. Instead of planting wheat in the same field year after year, one changes the type of crop in order to maintain soil quality. Although this sensible tradition has been around for centuries, the current corn-mania is plowing it under, as well.

Indeed, it would seem like the rules have changed when it comes to corn. Granted, corn can be consecutively planted in the same fields for 10 to 12 years without any major loss in yields. In fact, some leading figures in agriculture in Lower Saxony will proudly proclaim that they have successfully planted corn in the same fields for 28 years in a row.

But the problem is that society at large pays the price for the environmental damage resulting from this kind of monoculture farming. For example, bird species -- such as the Montagu's Harrier and the Northern Lapwing -- are disappearing because they can no longer find breeding grounds. Likewise, between 2004 and 2010, over 90 percent of the species-rich grasslands in certain areas of Bavaria have vanished -- often being replaced by corn fields.

Corn in the Marshlands

These days, corn is already being planted in marshlands, such as those near the northwestern town of Bremervörde. Although biogas has long been lauded as a means of rescuing the environment, here its devastating effects are on full display.

"In such soils, the carbon captured in the bog is released over the long term," says Uwe Baumert, a senior official with the Lower Saxony branch of the Nature and Biodiversity Conservation Union (NABU). NABU estimates that growing corn releases 700 grams (25 ounces) of carbon dioxide into the atmosphere for every kilowatt hour of energy it produces. And this happens for years on end. This is comparable to the carbon-released-to-power-produced ratio of some coal-fired power plants.

Karsten Specht, the managing director of OOWC, the water supplier of Oldenburg and northern coastal region of East Frisia, has grown increasingly worried while watching the boom of corn used for energy. Each biogas facility generates about 20,000 metric tons (44,000 pounds) of fermentation residue each year. This waste is then used as a fertilizer on the fields after the corn has been harvested. And just like pure liquid manure, these residues are nitrate bombs.

Specht has measured the nitrate-pollution levels in groundwater lying near the surface under corn fields. In most cases, it is somewhere between 80 to 120 milligrams per liter of water, which is clearly above the threshold value of 50 milligrams per liter.

"What we are setting in motion here is a big problem," Specht says. "We are tolerating the fact that the quality of the groundwater is going down the drain."

Meanwhile, the approval process for biogas plants seems to have been fast-tracked. In Gross Meckelsen, for example, a municipality lying between Hamburg and Bremen, a nine-reactor, five-megawatt project is underway. It will be the second facility in a small water conservation area.

Local politicians swept the concerns of the local water supplier under the rug. Some of them even have a financial stake in the planned facility, including the son of Hans-Heinrich Ehlen, a former and long-serving agriculture minister in Lower Saxony and a member of Chancellor Angela Merkel's center-right Christian Democratic Union (CDU).

'No Chance' Against Solar and Wind Energy

Politicians saw this development coming. Already in 2007, the scientific advisory committee of the Federal Ministry of Food, Agriculture and Consumer Protection advised against this kind of support. Then-Minister Horst Seehofer, now head of the CDU's Bavarian sister party, the Christian Social Union (CSU), and his successor and fellow party member Ilse Aigner have long ignored such concerns, and the biogas lobby has developed close ties to the CDU and CSU. Indeed, it was only a few months ago that the first adjustments were made to the subsidy regime: Now the state-supported facilities are only allowed to process 60% of the corn grown in Germany.

Just over four weeks ago, a group of high-ranking academics repeated their calls for an end to the biogas boom. These were researchers from the German National Academy of Sciences, or Leopoldina. More than anything, they were bothered by the pathetic level of efficiency of the biogas plants in relation to the huge expanses of land they take up.

Indeed, in 2012 some €4.8 billion will be spent on a feed-in tariff to keep alive a technology that, in the words of Leopoldina member Rolf Thauer, "doesn't stand a chance" against solar- and wind-generated energy. When measured in terms of energy in- and outputs, solar energy is five times more efficient than corn-produced biogas, and wind energy is 10 times more efficient.

The transition to renewable energy laid out by Chancellor Merkel in 2011 in the wake of the Fukushima nuclear disaster is very ambitious. It aims to boost renewable energy to 35% of total power consumption in Germany by 2020 and 80% by 2050 while phasing out all of Germany's nuclear power reactors by 2022. But, all things considered, the contribution made by biogas plants seems rather paltry.

At the moment, 80% of all the world's biogas plants are in Germany, including the biggest ones in the world, in Penkun and Güstrow, both of which are located in the northeastern state of Mecklenburg-Western Pomerania. Each of the plants generates 20 megawatts, or enough to supply 40,000 households with power; and each of them requires 1,000 metric tons of corn per day, which is grown on some 12,000 hectares of fields stretching all the way to Poland. But, in the final calculation, the massive industry is still dwarfed by the major sources of renewable energy.

'Corn Racism'

Felix Hess, the head of the bio-energy company Nawaro, is puzzled by this "corn racism." After all, he says, the idea for biogas was born in an age of set-aside premiums and mountains of surplus grain crops. He blames the problems that the corn-energy plants still face on the fact that they rely on relatively new technology.

Hess says that the facility in Güstrow has a somewhat incredible efficiency factor of over 80%. In any case, the facility is no longer dependent on EEG subsidies and feeds its biogas directly into the natural gas network. Still, he admits that the technology hasn't reached its full maturity.

Meanwhile, Hess is facing completely different effects of the boom. Some farmers are taking advantage of the situation to renegotiate their delivery prices. In Mecklenburg-Western Pomerania, he says, things still work. "If we had the prices of Lower Saxony here, we would be broke right away."

Translated from the German by Josh Ward.

http://www.spiegel.de/international/germany/biogas-subsidies-in-germany-lead-to-modern-day-land-grab-a-852575.html