The US government is addressing the issue of climate change in part by aggressively promoting first and second generation biofuels. Since the main driver of the policy is climate change, a large body of research is developing that analyzes biofuels’ carbon implications. However, less attention is being paid to other environmental impacts of the bioeconomy, and its implications for conservation policy. Current conservation approaches were developed in periods of excess production and had the dual goal of supporting prices and promoting environmental quality.  Increased land values associated with the bioeconomy are making this approach less viable, and are substantially impairing conservation.
There is a need to assess the variety of external costs associated with biofuel production, and use this information to devise an informed, effective conservation policy. Though it is hard to obtain monetized values for ecosystem services, some physical quantities can be readily included in the analysis by using indicators from ecological models and material fluxes. These can help guide a conservation policy more strictly focused on ecosystem serviced provision alone in an era of increased commodity prices.
To illustrate the issue, I consider the impact of the biofuels industry both on current cropland and on land in the Conservation Reserve Program (CRP), a set-aside program, and several edge-of-field environmental indicators. The study focuses on Iowa, a leading biofuels hotspot due to intensive corn production and the high concentration of ethanol plants. Economic, geographical and environmental models are linked by using spatially explicit common units of analysis. Land use changes are predicted via economic analysis of crop rotation choice and tillage under alternative crop prices, and the Environmental Policy Integrated Climate (EPIC) model is used to predict corresponding environmental impacts.
Results/Conclusions

Substantial shifts in rotations favoring continuous corn are likely if high corn prices are sustained for first generation technologies. Even when cellulosic ethanol production becomes viable, the use of corn residue has lower production costs than dedicated perennial feedstocks. Increases in continuous corn – with or without corn stover removal – could have substantial environmental impacts, particularly if tillage practices are not limited. Returning CRP land into production has a vastly disproportionate environmental impact, as non-cropped land shows much higher negative marginal environmental effects when brought back to row crop production. This illustrates the need to devise new conservation policies that focus protection on the most environmentally sensitive lands and selectively limit the most disruptive management practices on working lands.