Climate change legislation must be examined
for impact on American agriculture
Commissioner Richie Farmer
As climate change legislation winds its way through Congress, we need to look at the details. Some of those details might cause problems for Kentucky agriculture.
The U.S. House of Representatives passed H.R. 2454 and sent it on to the Senate. The Senate Committee on Agriculture, Nutrition and Forestry will resume examining the bill when Congress returns Sept. 7 from its summer recess.
Estimates on the legislation’s impact on American agriculture vary widely. The American Farm Bureau Federation (AFBF) believes the bill would impose enormous costs on agriculture. The U.S. Department of Agriculture claims it would benefit farmers.
Animal agriculture sometimes gets blamed for increasing climate change, but according to the Environmental Protection Agency (EPA), livestock producers were directly responsible for only about 2.5 percent of U.S. greenhouse gases in 2007.
From 1990 to 2005, American meat production increased about 40 percent while greenhouse gas emissions from livestock remained nearly constant. That translates to almost 30 percent fewer emissions per pound of meat. In fact, since 1948, manure generated by meat-producing animals has been cut 25 percent while meat production increased 700 percent. So you see, animal agriculture is actually a climate control success story.
Those figures help explain why agriculture is not treated as a capped sector in the House bill that limits greenhouse gases from large emitters. Instead, agriculture is given incentives to invest in carbon-reducing activities. The incentives, called carbon offsets, can be sold on the open market to companies wishing to meet their greenhouse gas emission limit under the bill. For example, a coal-burning power plant could buy offsets to reduce its emission allowance requirement.
What does that mean to the American farmer? It depends on whom you ask. U.S. Agriculture Secretary Tom Vilsack says revenue from offsets will easily outpace the increased input costs to farmers over the long term.
During the first five years of the cap-and-trade program, Vilsack says that agriculture will benefit directly from allowance revenues to finance incentives for such improvements as agricultural emissions reductions. Funds for emissions reductions alone are estimated to range from $75 million to $100 million annually from 2012-16, Vilsack said.
A USDA analysis indicates that annual net returns to farmers will range from about $1 billion per year in 2015-20 to almost $15-20 billion in 2040-50, not counting the costs of implementing offset practices. Vilsack believes these figures are conservative estimates and could turn out to be much higher.
On the other hand, AFBF warns that offsets revenue will only partially reduce increased costs, and not all farmers will benefit from offset opportunities. Not every Kentucky farmer can afford to capture methane emissions from his livestock. Not every Kentucky farmer has enough land to set aside to plant trees. And most Kentucky farmers don’t live in regions where wind turbines are an option. Yet those producers would be burdened by the same increased costs of fuel and electricity as their counterparts who might benefit from offsets markets.
We also need to make sure that our trading partners and rivals are working just as seriously on climate change as we are. If China and India don't take similar measures, the net effect of the bill on climate change will be negligible. Going it alone on climate change policy and making significant economic sacrifices for minimal gain doesn't make any sense.
All of us want to make sure that our children and grandchildren inherit a cleaner, safer, healthier world. Climate change is a problem that will require serious action from every country on Earth. But we have to do it right, and the other major greenhouse gas emitting countries have to work with us.
I urge you to contact Sens. Mitch McConnell and Jim Bunning, and tell them what you think. I pledge to work with people across the spectrum and with other state agricultural leaders to come up with climate legislation that is friendlier to Kentucky agriculture.
