Rethinking Biofuels in the US Midwest

This Working Paper is part of U.S. People-Centered Transitions and U.S. Climate within Climate. Reach out to Haley Leslie-Bole for more information.

Over the past two decades, policies promoting first-generation biofuels have significantly reshaped the Midwest's landscape, economy and agricultural systems. Today, 30-40% of U.S. corn is used to produce biofuels that contribute just 6% of national transportation energy, highlighting a disproportionate use of land and resources for limited energy output. While these policies have offered economic benefits to some, they have caused major environmental, social and economic trade-offs for communities in the Midwest and beyond.

This analysis examines the consequences of expanding first-generation biofuels in the Midwest and urges reconsideration of the role of these fuels in the Midwest's future. These fuels, largely derived from edible crops such as corn and soy, drive land use change, increase global greenhouse gas emissions and could contribute to global food insecurity. They also contribute to water pollution, water stress and habitat loss. As the impacts of climate change worsen and potential demand for crop-based aviation fuels grows, these issues could intensify.

The environmental burdens are accompanied by socioeconomic impacts. Benefits from biofuels production are concentrated among a small group of stakeholders, while marginalized farmers and small-scale farmers likely benefit least.

This report synthesizes literature and expert perspectives to inform policy decisions about the future of biofuels. It concludes that continued investment and subsidization of first-generation biofuels undermines long-term climate resilience and equity in Midwestern agriculture. Policymakers, farmers and community leaders are urged to re-evaluate the role of these fuels and consider alternative strategies that prioritize clean water, food security and inclusive economic opportunity.

With aviation fuels ushering in a new wave of biofuels policies, the U.S. is at a critical point where policymakers can re-examine the impact of the past decade of biofuels subsidies and chart a path forward for the Midwest. This paper offers a roadmap for research and recommends energy and agriculture policies that serve both people and the planet more effectively.

Key Findings:

1. Increased production of fuel made from corn and soy would raise global emissions by increasing demand for agricultural inputs and displacing crops grown for food.
2. The benefits of biofuel production remain concentrated among a small fraction of midwesterners, while the costs are borne by consumers, taxpayers and other industries.
3. Increasing production of biofuels can also increase food prices and exacerbate food price volatility.
4. First-generation biofuels make midwestern communities less resilient to climate change effects, such as water stress, and amplify existing environmental and public health challenges, such as water quality degradation.