"Since the late 1970s, U.S. policy makers at both the federal and state levels have enacted a variety of incentives, regulations, and programs to encourage the production and use of agriculture-based renewable energy. Motivations cited for these legislative initiatives include energy security concerns, reduction in greenhouse gas emissions, and raising domestic demand for U.S.-produced farm products. Agricultural households and rural communities have responded to these government incentives and have expanded their production of renewable energy, primarily in the form of biofuels and wind power, every year since 1996. The production of ethanol (the primary biofuel produced by the agricultural sector) has risen from about 175 million gallons in 1980 to nearly 4.9 billion gallons per year in 2006. The U.S. ethanol production capacity has also been expanding rapidly, particularly since mid-2006, with important implications for the food and fuel sectors. Current ethanol production capacity is 5.6 billion gallons per year (February 28, 2007), with another 6.2 billion gallons of capacity under construction and potentially online by late 2008. Biodiesel production is at a much smaller level, but has also shown growth rising from 0.5 million gallons in 1999 to an estimated 200 million gallons in 2006. Wind energy systems production capacity has also grown rapidly, rising from 1,706 megawatts in 1997 to an estimated 11,603 megawatts by December 31, 2006. Despite this rapid growth, agriculture- and rural-based energy production accounted for only about 0.7% of total U.S. energy consumption in 2006."
CRS Report for Congress, RL32712
National Agricultural Law Center http://www.nationalaglawcenter.org/crs/