By DAVE BLOWER JR.
Farm World Editor

WASHINGTON, D.C. — The U.S. House of Representatives on June 26 adopted the American Clean Energy and Security Act of 2009 by a 219-212 vote.

This controversial proposal (H.R. 2454), also referred to as the cap-and-trade bill or the Waxman-Markey climate change bill, will go to the U.S. Senate for approval before it can be signed into law by President Obama.

This proposal sets a limit on the total amount of greenhouse gases that U.S. businesses can emit. For businesses to emit greenhouse gases (GHG), they must own a “ration coupon” for each ton emitted.

Critics of the plan claim that U.S. businesses will be required to spend money on mandated ration coupons – which equals a new tax – and they will, in turn, pass that expense on to consumers. In addition, gas and electricity bills are expected to increase for all Americans.

Supporters of the bill believe it is one way to help pay for the programs needed to help curb man-made climate change.
Farm groups seem to be split on how this proposal would impact agriculture. Most, however, are pleased that an amendment offered by House Ag Committee Chairman Collin Peterson (D-Minn.) was included in the bill.

The Peterson amendment establishes the USDA’s role in a cap-and-trade system. The amendment creates an agricultural offsets market under the jurisdiction of the USDA and will explicitly exempt agriculture from a GHG emissions cap while also creating opportunities for producers to be a part of the solution for addressing climate change.

Peterson’s amendment also blocks the Environmental Protection Agency (EPA) from including international land-use change when calculating carbon emissions from corn-based ethanol.
The National Farmers Union (NFU) was pleased with the amendment.

“This legislation recognizes the unique role America’s family farmers and ranchers can play when it comes to combating global climate change,” said National Farmers Union President Roger Johnson. “The agricultural offset program, overseen by USDA, will help mitigate the increased input costs of a cap-and-trade program, while the early actors provision recognizes those producers who have already adopted environmentally-friendly practices.

“Failing to pass climate change legislation is not an option. The EPA is poised to act, with the agency’s proposed endangerment finding paving the way for a regulatory approach to addressing greenhouse gases. If this were to occur, the positive provisions within climate change legislation would be lost.

“While not perfect, the House-passed bill is a step in the right direction. I look forward to working with the Senate as they begin considering climate change legislation.”

The National Corn Growers Assoc. (NCGA) also hailed Peterson.
“We appreciate the dedication Chairman Peterson has shown to U.S. corn growers and the agriculture industry during this legislative process,” NCGA President Bob Dickey said. “He has been a true champion for our industry during negotiations and his amendment to the climate change legislation will make several steps in the right direction.”

NCGA said it will continue to work to address items not included in the final language that are important to corn growers. Specifically, the NCGA will advocate for producers who have been engaged in no-till and conservation tillage practices since earlier than 2001 to ensure they will not be unfairly penalized by being disqualified from an offsets market when continued carbon sequestration is achievable on their land. NCGA urges Congress to consider the implications of policies that create incentives for farmers to release previously stored carbon into the atmosphere in order to benefit from a cap and trade market.

Dickey added, “We look forward to working with the U.S. Senate to continue improvements on this important piece of legislation.”
Livestock groups, such as the pork and beef organizations, are against the cap-and-trade bill.

“With U.S. pork producers suffering record losses, the National Pork Producers Council cannot support climate change legislation even with the compromise language agreed to (last week),” said the NPPC in a news release.

“NPPC anticipates significant increases in energy prices and in pork production costs under the House climate change bill. The hikes would be overwhelming to pork producers, who for the past 21 months have been losing an average of $22 per hog. From April 24 to June 19, and due mostly to the H1N1 flu crisis, the U.S. pork industry lost $352 million, or about $8.8 million per production day; for the remainder of 2009, producers are expected to lose an average of $9.82 per hog. Many pork producers now are at risk of being put out of business, and passage of this climate change bill would only make that risk greater and put more producers in jeopardy.”

“While the compromise language would allow the U.S. Department of Agriculture rather than the U.S. Environmental Protection Agency to design and implement the agricultural greenhouse gas offset credits program and to develop any climate change regulations affecting livestock producers – a provision supported by NPPC – the organization doesn’t believe that revenues from the sale of offset credits for the majority of pork producers would counterbalance the energy and input cost increases associated with the bill.”

The National Cattlemen’s Beef Assoc. (NCBA) and an informal coalition of companies and trade associations representing U.S. energy and mining sectors are challenging the belief that human-caused greenhouse gas (GHG) emissions are an endangerment to public health and welfare.

“With so much scientific uncertainty surrounding the question of whether human activity is responsible for climate change, it is inappropriate for the EPA to only consider one side of the debate - especially considering the devastating consequences that their actions could have on an already struggling U.S. economy,” says Tamara Thies, NCBA chief environmental counsel. “Additionally, the Clean Air Act is ill-equipped to regulate greenhouse gases. Should EPA move forward, we could find ourselves in a mire of bureaucracy and red tape.”

The EPA has said that manure management facilities associated with livestock production account for less than 1 percent of total U.S. GHG emissions. Regulation of these emissions would be inconsequential to the climate change equation. Rather than being unnecessarily regulated, agriculture should be considered an important solution to climate change.

“Before mandating drastic regulation on U.S. industry, EPA has a responsibility to conclusively demonstrate that altering human activities could mitigate climate change issues,” Thies said.
Rep. Dan Burton (R-Ind.), who voted against the bill called the proposal a tax, plain and simple.

“The passage of Cap-and-Trade is a real tragedy for Indiana and the rest of the country. Speaker Pelosi and President Obama have rushed this bill to a vote and spent all week twisting arms and cutting deals with Democrats who were previously opposed to the bill,” Burton said. “It’s a shame they buckled, because if this bill passes the Senate, it will mean devastation for American jobs and family budgets.