Climate bill silent on ag offsets

May 22, 2009
Climate bill silent on ag offsets

A chairman’s draft of legislation on climate change released by the House Energy and Commerce Committee spells out no clear role for agriculture in providing carbon offsets for industry.

Committee Chairman Henry Waxman, D-CA, on May 15 posted his 932-page bill, a chairman’s “mark” that will be debated for changes and possible passage by his committee. The bill has few mentions of agriculture throughout the legislation, with no role mentioned regarding whether agricultural land would be eligible for carbon sequestration.

People familiar with the situation who spoke to DTN said that doesn’t necessarily mean Waxman sees no role for agriculture, but that Waxman may leave agriculture’s role in the bill to the House Agriculture Committee to add to the legislation.

An amendment for agricultural offsets also could come up in Waxman’s full committee debate this week. Agricultural groups have been spelling out ways that farm ground can be used to offset carbon dioxide emissions in various industries.

Forestry and cropping practices such as no-till have been shown to sequester more carbon than agriculture’s actual emissions. Agricultural groups want to see farmers rewarded for those practices and want to ensure that USDA plays a role in implementing any greenhouse-gas emission program that involves agriculture.

The chairman’s mark only mentions agriculture in relation to studies regarding the impacts of climate change in different circumstances.

USDA and the Department of Interior would also participate in a land and water conservation fund under the bill to buy private land as well. A spokesperson for Waxman’s committee did not respond to an e-mail seeking comment.

Rep. Frank Lucas, R-OK, ranking member of the House Agriculture Committee, issued a statement May 15 saying cap and trade effectively amounts to a national energy tax that will affect the cost of fuel in tractors, fertilizer for crops, and delivery of food to grocery stores. Lucas also noted that the bill mentions “agriculture” just six times.

“It appears that in return for drastically higher input prices, our farmers and ranchers will get a report every four years and a new federal program to purchase private property,” Lucas stated. “It is imperative that Congress conduct hearings and study this legislation and its implications for production agriculture carefully.”

The House Agriculture Committee has created a survey for ag groups and is holding some staff meetings on carbon sequestration and climate change, but has not set any hearings. Last year, when a similar bill was debated in the Senate, there were floor amendments that would have allowed agriculture to play a role in offsets.

Waxman’s bill would exempt companies that emit less than 25,000 tons of carbon dioxide or an equivalent amount of other gases per year from being required to reduce emissions further. Agricultural lobbyists have been assured that all agricultural operations will remain excluded from the emissions cap. On the same day, the House Energy and Commerce Committee also posted a “proposed allowance allocation” for distributing carbon allowances, which would give away up to 85 percent of the initial allowances for greenhousegas emissions.

An allowance is a value of pollution a company or major emitter is given or purchases from the government for their greenhouse-gas emissions. An allowance can be coupled with offsets, which are purchased on the market by polluters from those who have stored carbon or reduced their pollution lower than their allotted allowances.

The emission allowances are being distributed to industries to help mitigate the potential increase in consumer energy costs that Republicans and business groups state will be the true impact on consumers.

Allowances are being spread in a lot of areas. Allowances will go to electricity and natural gas companies, home heating-oil and propane, and even low-income families. They will auction 15 percent of the allowances, and the revenue will be distributed to help offset energy costs for lowincome families.

Allowances will be given to states for investments in renewable energy and energy efficiency. Allowances also will go to help offset or prevent tropical deforestation in other countries. Then there are “investments in carbon capture and sequestration.”

That section states 2 percent of allowances from 2014 to 2017 and 5 percent of allowances thereafter would go to “help electric utilities cover the costs of installing and operating carbon capture and sequestration technologies.” — Chris Clayton, DTN