SIOUX FALLS, S.D. — Legislation introduced in the U.S. Senate this week would entice farmers near ethanol biorefineries to grow dedicated energy crops.

Sen. John Thune, R-S.D., said his bill would offer incentives to farmers who plant switchgrass, fast-growing trees and other cellulosic feedstocks and deliver them to the next generation of ethanol plants. Cellulose is the woody material in branches and stems that makes plants hard.

"For cellulosic to achieve its potential, Congress needs to help this industry overcome some of the initial market barriers," Thune said Wednesday during a conference call. "And if we are serious in the country about reducing our dependence upon foreign oil, we have to be serious about giving the necessary jump start to America's budding alternative fuels industry and the farmers who supply it."

Thune said he hopes the legislation will be included in the energy section of the farm bill, which is up for review by Congress this year.

Breaking cellulose into sugar to spin straw into ethanol has been studied for at least 50 years. But the technological hurdles and costs have been so daunting that most ethanol producers instead relied on heavy government subsidies to squeeze fuel from corn.

In February, the U.S. Department of Energy awarded $385 million in grants over four years to six companies hoping to build the nation's first large-scale cellulosic ethanol plants. Earlier this month, Energy Secretary Samuel Bodman announced plans to invest an additional $200 million over five years to help companies develop smaller biorefineries.

Under the bill introduced Wednesday, the U.S. Department of Agriculture would determine the likelihood of construction of a future biorefinery, the local potential for feedstock production, the number of interested farmers and a biorefinery's economic impact.

The bill would likely fund 10 to 12 feasibility studies, each costing about $50,000, Thune said.

Once a project is approved, farmers could enroll eligible land in the program.

During a contract's first five years — as the ethanol plant is built and the crop is getting established — farmers would receive a cost share and a per-acre rental payment. Once the biorefinery starts up, the rental payment would end and the farmer would get a matching payment of up to $45 for each ton of delivered biomass for up to two years.