Clean-energy legislation: An opportunity for agriculture and forestry

Agriculture and forestry have much to gain from passage of comprehensive clean energy and climate legislation and much to lose from prolonged fossil fuel dependence and accelerating climate change. Enacting clean energy legislation like that passed by the House in June and now being considered by the Senate will bring new life to the American economy. Farmers and ranchers will have the opportunity to earn more diversified incomes, lessen our dependence on foreign oil and its volatile fuel prices, and create jobs in rural America.

U. S. Secretary of Agriculture Tom Vilsack called the U.S. House of Representatives action on climate change “one of the most important votes in the last 100 years.” “It is a vote about the future,’ he said. “It is a vote about redefining the economy of this country.”

The recently released USDA report on the effects of comprehensive national energy and climate legislation found the economic benefits to agriculture from the legislation will likely outweigh the costs in the short term, and that the economic benefits from offsets markets will easily outpace increased input costs over the long term.

“Our analysis demonstrates that the economic opportunities for farmers and ranchers can potentially outpace - perhaps significantly - the costs from climate legislation,” said Vilsack.


Here are nine reasons why Northwest Senators should support this legislation:

1.   Energy efficiency measures would reduce farmers’ and ranchers’ electricity bills
Energy expenditures represent 6 percent of total national farm production costs, costing farmers over $10 billion annually. All across the region, farmers and ranchers have been lowering their energy costs by installing a variety of energy efficient measures such as lighting, HVAC systems, NEMA premium motors, and appliances. Efficiency rebate programs and tax credits will now help more farmers and ranchers lower their energy bills.

2.   Farmers and ranchers can gain more control of their energy costs and reduce their exposure to volatile fossil fuel markets
Fuels and fertilizers are a major component of farmers and ranchers operating costs. Fossil fuels are repeatedly subject to wild price swings due to a variety of factors – political instability, cartel pricing and storms in oil-producing regions. The USDA’s preliminary economic analysis of clean-energy and climate change legislation concluded that in the short term, fuel prices will rise 0.3 percent and fertilizer costs changes will be minimal because of protections in the legislation for energy intensive, trade-exposed industries. By increasing energy efficiency, improving fuel and fertilizer management, growing the next generation of biofuels and maximizing domestic resources farmers and ranchers can reduce our dependency on these economically unstable resources and save money on their fuel and fertilizer costs.

3.  Farmers and ranchers can earn new income by leasing their land for renewable power while continuing to farm
Renewable energy provisions in the House legislation will drive a robust market for new renewable energy sources.  Farmers and ranchers can install wind turbines, solar panels, and other renewable energy technologies on their land and buildings. In the Pacific Northwest farmers and ranchers are earning $3,000 to $5,000 annually per wind turbine on long term (20 to 30 years) contracts. The Department of Energy estimates that if 5 percent of the nation’s energy comes from wind by 2020, rural America could see $60 billion in capital investment. Farmers, ranchers, and rural landowners would derive $1.2 billion in new income, and 80,000 new jobs would be created in the next two decades.

4.  Farmers and ranchers can profit by helping America reduce greenhouse gases
Our agricultural and forest lands sequester 246 million metric tons of carbon annually. The EPA reports that these lands have the potential to sequester or eliminate approximately 20 percent of our total national emissions. Clean-energy legislation promotes agricultural and forest lands as carbon sinks by encouraging low tillage practices, tree and perennial planting, erosion prevention, rotational grazing, and winter cover cropping.

5.    Improved conservation and stewardship practices reduce carbon while preserving our critical soil resources
Farmers and ranchers understand better than anyone the importance of husbanding our lands and soils for future generations. Using agricultural and forest lands as carbon sinks provides a variety of co- benefits such as reduced soil erosion, improved water quality, and more diverse wildlife habitat.

6.   Farmers and ranchers can grow dollars by selling high-quality “carbon offsets”
Farmers and ranchers will be able to sell credits earned from conservation and stewardship practices that sequester or eliminate additional carbon. High quality carbon offsets are expected to be valued at between $15-20 a ton, rising over time. By comparison the current voluntary markets price is less than a dollar a ton after reaching a high of around $7.00 in 2007. While agriculture won’t be the only sector generating offsets, it will be a major player. Reducing carbon can put real money put back into the pockets of farmers and ranchers and rural communities.

7.   Farmers and ranchers will produce the future's cleaner fuels
The current renewable fuels standard (RFS) establishes ambitious targets and strives to produce advanced biofuels that minimize the use of food-based feed stocks and maximize environmental benefits. The RFS has a production target of 21 billion gallons of advanced biofuels by 2020. Here in the Northwest our farmers and ranchers are actively growing crops such as camelina for the next generation of biofuels. .

8.   A safety net to protect rural families from higher energy prices
Rural consumers experiencing a loss in purchasing power due to energy costs would qualify for an expanded earned income tax credit.

9.   Doing nothing is not an option
Our climate is changing, and our dependence on fossil fuels continues to undermine our economy and security.  Farmers and ranchers all across the Northwest know better than anyone that climate change is already happening. They are already seeing the effects of extreme weather events including drier summers, less snowpack, and more vigorous flooding during planting. And they are particularly vulnerable to the economic disruptions caused by fossil fuel price volatility.

Now is the time to break this cycle. We need to pass comprehensive climate change and clean-energy legislation.

Download a PDF of this factsheet.

Source: much of the information in this factsheet comes from “Eight Reasons for Farmers to Support Global Warming Action”, Center for American Progress, Jake Caldwell, Alexandra Kougentakis, June 2009.”