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Rules by Which Farmers Can Sequester Carbon and Gain Valuable Emissions Permits; A Key Constituency to Passage of Mandatory Climate Legislation

(Washington, D.C.) -- On the eve of Senate debate on legislation to cap U.S. greenhouse gas emissions, former Senate Majority Leaders Bob Dole and Tom Daschle today released recommendations for creating a robust U.S. market for agricultural carbon credits to cut emissions and provide a valuable new asset for famers. 

“Political leaders, members of the business community, and the general public increasingly expect that restrictions on emissions of greenhouse gases (GHGs) will be needed to address the problem of global warming,” Dole and Daschle write in the report.   “As Congress moves forward in the near future to draft and debate climate change legislation, American agriculture can play an important role in  shaping the eventual policy outcome—and specifically, in ensuring that any future U.S. cap-and-trade program fairly credits farmers and ranchers for GHG reductions and allows them to participate in a new national market for carbon credits.  The stakes are extremely high for America’s agricultural producers.  Done well, a national GHG emissions control policy can provide a new multi-billion dollar per year market opportunity for farmers.”

In a report last year, Dole and Daschle came out in favor of mandatory measures to reduce U.S. greenhouse gas emissions.  The new report released today focuses solely on the emerging agricultural carbon market. Dole and Daschle recommend that Congress adopt rules for new agricultural carbon markets that appropriately reward carbon sequestration and other agriculture projects that reduce greenhouse gases in the atmosphere.  Specific recommendations include:

• U.S. farmers and ranchers should have the opportunity to participate in a national cap-and-trade program for GHG emissions.

• Within a cap-and-trade program, the agriculture sector should be fully rewarded for all verifiable GHG emission reductions. 

• As in other sectors of the economy, energy-related GHG emissions from the agriculture sector should be regulated upstream, at the fuel supplier or distributor, electric utility, or large industrial facility. 

• A cap-and-trade program that provides for both offset credits and set-aside allowances will give agricultural producers the flexibility to choose different levels of rigor in documenting emissions benefits and will help to deliver maximum economic and environmental benefits from low-cost mitigation opportunities in the agriculture sector. 

• USDA, in collaboration with state and national agricultural producer organizations and the Consortium for Agricultural Soils Mitigation of Greenhouse Gases (CASMGS), should develop standardized, certified protocols for measuring, monitoring and verifying soil carbon changes that can be utilized by agricultural producers to facilitate their participation in carbon markets. 

• Standardized, certified protocols and methodologies for the measurement and verification of soil carbon sinks should be clear, transparent, and practical in order to maximize the market’s acceptance of and ability to value soil carbon emission reductions, while also maximizing agricultural producers’ participation in carbon markets, and the resulting benefits to society. 

• Additional provisions may be necessary to address the issue of permanence for biological (soil- or forestry-based) carbon sinks and to assure overall program integrity in the event that future actions or natural events cause unanticipated carbon losses.

• Projects begun prior to the initiation of a nationwide cap and trade program at a minimum should receive credit for all greenhouse gas benefits achieved beginning on the date of the implementation of the program. 

• In addition to rewarding carbon sequestration projects for GHG reductions that occur beginning at the inception of the program, Congress should consider setting aside some allowances to reward early adopters that achieve emissions benefits prior to implementation of a mandatory policy. 

• All domestic biological carbon offsets should be credited and rewarded prior to rewarding international projects. 

• USDA should establish clear rules to allow any qualified person or organization to act as an aggregator for agriculture-based offset credits or allowances in future GHG markets.  Ultimately, agricultural organizations may want to consider joining together to form a single national cooperative aggregation and carbon brokerage service to interact directly with regulated entities.  Such an entity could allow agricultural organizations to maximize returns to the farm sector by avoiding the use of non-agricultural brokers and traders.

• USDA should provide verification services through its extension agents and should additionally certify private verification services. 

• Congress should provide funding to assist key private sector adopters to offset the costs of developing and demonstrating new measurement, monitoring and verification methodologies for soil carbon sequestration.

• Congress should provide $15 million per year to the Consortium for Agricultural Soils Mitigation of Greenhouse Gases.

The new agricultural carbon markets report was released by the senators as part of the Bipartisan Policy Center’s 21^st Century Agriculture Policy Project.  One year ago, Senators Dole and Daschle released their first report of the project, entitled Competing and Succeeding in the 21^st Century; New Markets for American Agriculture, which set forth a number of recommendations to Congress on a range of issues, including preserving the agricultural safety net, reducing the cost of the federal Farm Bill, promoting renewable energy development on agricultural lands, and creating a robust market for agricultural carbon credits.  Both reports can be found at: http://www.21stcenturyag.org/ and http://www.bipartisanpolicy.org/.

On the need for mandatory action on climate change, Dole and Daschle stated last year:

“Federal action to establish a mandatory program to limit greenhouse gas emissions is sensible and will provide agricultural producers with significant new market opportunities. The agriculture sector is in a unique position to lead in—and benefit from—efforts to address climate change.”