Our first stop on Samso (a Danish island in the Kattegat) was lunch at the Energy Academy headed by Soren Hermansen, who led the island to 100 percent carbon neutrality by combining renewable energy technologies with innovative cooperative financing models.

We met with Jesper Kjems, the communications director of the academy, who took us on a tour of one of Samso's four biomass-powered district heating systems. Like the island's famous wind turbines, the biomass plants which meet 65 percent of the island's heating needs, are cooperatively owned by the farmers who live on the island. Here's Jesper explaining how it works:

The farmers have a contract to deliver bales of straw (mostly from wheat production) to their heating plant, which delivers the heat in underground hot water pipes back to their homes.

Straw is a surprisingly efficient fuel -- a bale of straw produces the equivalent heat value of 50 gallons of oil, and because it can be regrown on an annual basis, it is considered a carbon-neutral fuel (the subsequent year's crop will consume the same amount of CO2 as was produced during its combustion). The byproduct of the process is ash which is used to fertilize the fields.

In the 1970s, the oil embargo hit the Danes very hard. They were utterly dependent on the fuel for both transportation and heating. This hard lesson led a spirit of "energy independence" in Denmark long before the concept was popular in the U.S. (that would be last year).

This spurred developments in local fuel stocks like biomass and biogas as well as the distribution system that makes these forms of heat energy economically viable — district heating.

Though the U.S. produces a massive amount of waste biomass, it lacks the cozy village settlement patterns of Europe (with small townships surrounded by crop lands centered 2-5 kilometers apart) that provide efficiencies in delivering the heat. So biomass heat is unlikely to take off in America.

But the idea of farmer-funded energy projects is very compelling (the farmers actually gain an additional source of revenue on top of lowered energy costs). This may be an especially useful model as cellulosic ethanol technologies become mature in the U.S.

Turning straw into gold
The old fairy tale has become reality on Samso, where waste straw is turned into a valuable resource that heats a majority of the homes on the island.