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Climate Change, Energy and your farm
Officials from the Obama Administration continue to urge Congress to pass energy reform and greenhouse gas (GHG) emissions legislation this year. Most GHG conversations revolve around a Cap and Trade legislative initiative.
Emissions' trading, "cap and trade" is an administrative approach used to control pollution by capping the emission levels an entity can emit and providing economic incentives to reduce the emissions of pollutants (i.e., GHG). In theory, those that can easily reduce emissions most cheaply will do so, achieving the pollution reduction at the lowest possible cost.
Future limits on CO2 would be lowered over time meaning the emissions cap becomes progressively more difficult (expensive) to attain. However, driving up the cost of energy, by charging for emissions will ripple throughout the economy and will bring major changes to agriculture. There also is the concern that costs for domestic goods will increase under a cap and trade system leading to a competitive disadvantage compared to imported goods. Some Administration officials have suggested that placing a tariff on imported goods would "level the playing field" for domestic companies.
Agriculture stands to both win and lose under a cap and trade system. As an energy intensive industry, agriculture consumes over 5 billion gallons of diesel each year. Diesel fuel and other agricultural inputs are expected to increase dramatically if carbon is capped or regulated. In addition, animal agriculture is being viewed as a GHG emitter, with the potential to be regulated. Agriculture stands to be a winner from a cap and trade system if farmers can sell their carbon sequestration credits (e.g., using no-till farming practices, methane digesters and tree plantings). And, agriculture stands to gain if biofuels earn credits by reducing the use of fossil fuels.
The discussion becomes more complicated as it grows. There is the development of voluntary carbon markets, proposed mandatory greenhouse gas reporting, consideration of federal climate change legislation, and the proposed endangerment finding by the EPA. This section contains some tools that may be helpful in discussions on the latest in energy and climate change issues and how policy changes might affect you and your farm. The information provided is not to debate climate change, but rather to provide information on how policies developed around climate change and energy will impact our members.
