Climate Change: The Role of the U.S. Agriculture Sector
The Role of the U.S. Agriculture Sector
Updated June 20, 2008
Specialist in Agricultural Policy
Resources, Science, and Industry Division
The Role of the U.S. Agriculture Sector
The agriculture sector is a source of greenhouse gas (GHG) emissions, which
many scientists agree are contributing to observed climate change. Agriculture is
also a “sink” for sequestering carbon, which might offset GHG emissions by
capturing and storing carbon in agricultural soils. The two key types of GHG
emissions associated with agricultural activities are methane (CH4) and nitrous oxide
(N2O). Agricultural sources of CH4 emissions mostly occur as part of the natural
digestive process of animals and manure management at livestock operations;
sources of N2O emissions are associated with soil management and fertilizer use on
croplands. This report describes these emissions on a carbon-equivalent basis to
illustrate agriculture’s contribution to total national GHG emissions and to contrast
emissions against estimates of sequestered carbon.
Emissions from agricultural activities account for 6%-8% of all GHG emissions
in the United States. Carbon captured and stored in U.S. agricultural soils partially
offsets these emissions, sequestering about one-tenth of the emissions generated by
the agriculture sector, but less than 1% of all U.S. emissions annually. Emissions and
sinks discussed in this report are those associated with agricultural production only.
Emissions associated with on-farm energy use or with food processing or
distribution, and carbon uptake on forested lands or open areas that might be
affiliated with the farming sector, are outside the scope of this report.
Most land management and farm conservation practices can help reduce GHG
emissions and/or sequester carbon, including land retirement, conservation tillage,
soil management, and manure and animal feed management, among other practices.
Many of these practices are encouraged under most existing voluntary federal and
state agricultural programs that provide cost-sharing and technical assistance to
farmers, predominantly for other production or environmental purposes. However,
uncertainties are associated with implementing these types of practices depending on
site-specific conditions, the type of practice, how well it is implemented, the length
of time a practice is undertaken, and available funding, among other factors. Despite
these considerations, the potential to reduce emissions and sequester carbon on
agricultural lands is reportedly much greater than current rates.
Congress is considering a range of climate change policy options, including
GHG emission reduction programs that would either mandate or authorize a
cap-and-trade program to reduce GHG emissions. In general, the current legislative
proposals would not require emission reductions in the agriculture and forestry
sectors. Many GHG proposals, however, would allow farmers and landowners to
receive emissions allowances (or credits) and/or generate carbon offsets, which could
be sold to facilities covered by a cap-and-trade program. In addition, the enacted
2008 farm bill includes provisions that could expand the scope of existing land-based
conservation and other farm bill programs by providing incentives to encourage
farmers and landowners to sequester carbon and reduce emissions associated with
climate change, adopt energy efficiency measures, produce renewable energy
feedstocks, and participate in markets for carbon storage.
Agricultural Emissions and Sinks.....................................2
Source of National Estimates.....................................2
Direct GHG Emissions.....................................3
Other Types of Emissions...................................3
Total GHG Emissions......................................4
Uncertainty Estimating Emissions.............................4
Other Estimated Emissions..................................6
Sources of GHG Emissions..................................6
Potential for Additional Reductions...........................7
Agricultural Carbon Sinks......................................10
Carbon Loss and Uptake...................................10
Total Carbon Sequestration.................................11
Estimated Emission Offsets.................................11
Uncertainty Estimating Carbon Sinks.........................11
Potential for Additional Uptake..............................13
Per-Unit Value Estimates...................................13
Enhancing Carbon Sinks...................................14
Mitigation Strategies in the Agriculture Sector..........................16
Federal Programs ............................................17
Other Farm Programs......................................20
State Programs ..............................................21
Other Programs and Incentives..................................23
Recent Congressional Action........................................24
Climate Change Legislation.....................................24
Source of Emissions Reductions.............................25
Source of Offsets and Allocations............................25
Farm Bill Legislation..........................................28
Considerations for Congress....................................29
Appendix: Primer on Agriculture’s Role in the Climate Change Debate......32
List of Figures
Figure 1. Agricultural GHG Emissions, Average 2001-2005................7
Figure 2. National Distribution of Anaerobic Digester Energy Production,
Operating and Planned..........................................9
Figure 3. Carbon Sequestration in Agricultural Soils.....................10
Figure 4. USDA Conservation Spending, FY2005.......................19
Table 1. GHG Emissions and Carbon Sinks, Agricultural Activities,
Table 2. Carbon Sequestration Potential in the U.S. Agriculture Sector,
Alternative Scenarios and Payment Levels.........................14
Table 3. Representative Carbon Sequestration Rates.....................15
Table 4. Conservation and Land Management Practices...................18
The Role of the U.S. Agriculture Sector
The debate in Congress over whether and how to address possible future climate
change is intensifying. Often, the role of the U.S. agriculture sector is invoked in this
debate. Agriculture is a source of greenhouse gas (GHG) emissions, which many
scientists agree are contributing to observed climate change. Agriculture is also a
“sink” for sequestering carbon, which partly offsets these emissions. Carbon
sequestration (the capture and storage of carbon) in agricultural soils can be an
important component of a climate change mitigation strategy, limiting the release of
carbon from the soil to the atmosphere.
Congress is considering a range of climate change policy options, including
GHG emission reduction programs that would either mandate or authorize a
cap-and-trade program to reduce GHG emissions. In general, the current legislative
proposals would not require emission reductions in the agriculture and forestry
sectors. However, some of these proposals would allow farmers and landowners to
generate offsets in support of a cap-and-trade program. Other proposals would give
farmers and landowners a share of available allowances (or credits) for sequestration
and/or emission reduction activities. These offsets and allowances could be sold to
facilities (e.g., power plants) covered by a cap-and-trade program. Some bills also
specify that the proceeds from auctioned allowances be used to promote certain
activities, including farmland conservation and developing bio-energy technologies.
In addition, the omnibus 2008 farm bill (Food, Conservation, and Energy Act
of 2008, P.L. 110-246) could expand the scope of existing farm and forestry
conservation programs in ways that could more broadly encompass certain aspects
of these climate change initiatives. The bill provides incentives to encourage farmers
and landowners to sequester carbon and reduce emissions associated with climate
change, as well as produce renewable energy feedstocks. The bill also contains a
new provision that will facilitate the participation of the agriculture and forestry
sectors in emerging environmental services markets, focusing first on carbon storage.
This report is organized in three parts. First, it discusses the extent of GHG
emissions associated with the U.S. agriculture sector, and cites current and potential
estimates for U.S. agricultural soils to sequester carbon and partly offset national
GHG emissions. Second, the report describes the types of land management and
farm conservation practices that can reduce GHG emissions and/or sequester carbon
in agricultural soils, highlighting those practices that are currently promoted under
existing voluntary federal agricultural programs. The Appendix provides a summary
primer of the key background information presented in these first two sections.
Finally, the report describes ongoing legislative action within both the climate change
and farm bill debates, and discusses the types of questions that may be raised
regarding the role of the U.S. agriculture sector in the broader climate change debate.
This report does not address the potential effects of global climate change on
U.S. agricultural production. Such effects may arise because of increased climate
variability and incidence of global environmental hazards, such as drought and/or
flooding, pests, weeds, and diseases, or temperature and precipitation changes that
might cause locational shifts in where and how agricultural crops are produced.1
This report also does not address how ongoing or anticipated initiatives to
promote U.S. bioenergy production may effect efforts to reduce GHG emissions
and/or sequester carbon, such as by promoting more intensive feedstock production
and by encouraging fewer crop rotations and planting area setbacks, which could both
raise emissions and reduce carbon uptake.2
Agricultural Emissions and Sinks
Agriculture is a both a source and a sink of greenhouse gases, generating
emissions that enter the atmosphere and removing carbon dioxide (CO2) from the
atmosphere through photosynthesis and storing it in vegetation and soils (a process
known as sequestration). Sequestration in farmland soils partially offsets agricultural
emissions. Despite this offset, however, the U.S. agriculture sector remains a net
source of GHG emissions.
Source of National Estimates
Estimates of GHG emissions and sinks for the U.S. agriculture sector presented
in this report are the official U.S. estimates of national GHG emissions and carbon
uptake, as published annually by the U.S. Environmental Protection Agency (EPA)
in its Inventory of U.S. Greenhouse Gas Emissions and Sinks.3 EPA’s Inventory data
reflect annual national emissions by sector and fuel, including estimates for the
agriculture and forestry sectors. EPA’s estimates rely on data and information from
the U.S. Department of Agriculture (USDA), the Department of Energy, the
Department of Transportation, the Department of Defense, and other federal
departments. The EPA-published data are rigorously and openly peer reviewed
through formal interagency and public reviews involving federal, state, and local
government agencies, as well as private and international organizations. For the
agriculture and forestry sectors, USDA publishes a supplement to EPA’s Inventory,
which builds on much of the same data and information, but in some cases provides
a more detailed breakout by individual states and sources.4
1 See CRS Report RL33849, Climate Change: Science and Policy Options, by Jane Leggett.
2 See CRS Report RL34265, Selected Issues Related to an Expansion of the Renewable Fuel
Standard (RFS), by Brent D. Yacobucci and Randy Schnepf.
3 EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2005, April 2007, at
[http://epa.gov/climatechange/emi ssi ons/usinventoryreport.html ].
4 USDA, U.S. Agriculture and Forestry Greenhouse Gas Inventory: 1990-2001, TB1907,
March 2004, at [http://www.usda.gov/oce/global_change/gg_inventory.htm].
In this CRS report, emissions from agricultural activities are aggregated in terms
of carbon dioxide or CO2-equivalents, and expressed as million metric tons
(MMTCO2-Eq.).5 This aggregation is intended to illustrate agriculture’s contribution
to national GHG emissions and to contrast emissions against estimates of sequestered
Direct GHG Emissions. The types of GHG emissions associated with
agricultural activities are methane (CH4) and nitrous oxide (N2O), which are two of
the key gases that contribute to GHG emissions.6 These gases are significant
contributors to atmospheric warming and have a greater effect warming than the
same mass of CO2.7
Agricultural sources of CH4 emissions mostly occur as part of the natural
digestive process of animals and manure management in U.S. livestock operations.
Sources of N2O emissions are mostly associated with soil management and
commercial fertilizer and manure use on U.S. croplands, as well as production of
nitrogen-fixing crops.8 Emissions of N2O from agricultural sources account for about
two-thirds of all reported agricultural emissions; emissions of CH4 account for about
one-third of all reported emissions. Across all economic sectors, the U.S. agriculture
sector was the leading source of N2O emissions (80%) and a major source of CH4
emissions (30%) in 2005.9
Other Types of Emissions. Agricultural activities may also emit other
indirect greenhouse gases, such as carbon monoxide, nitrogen oxides, and volatile
organic compounds from field burning of agricultural residues.10 These emissions are
5 “Carbon-equivalents” equate an amount of a GHG to the amount of carbon that could have
a similar impact on global temperature. EPA’s data are in teragrams (million metric tons).
Alternative ways to express emissions and offsets are in carbon equivalents (MMTCE),
which assume a multiplier of 0.272 to convert from EPA-reported equivalent CO2-Eq. units.
6 The principal gases associated with climate change from human activities are CO2, CH4,
N2O, and ozone-depleting substances and chlorinated and fluorinated gases, such as
hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride. See CRS Report RL33849,
Climate Change: Science and Policy Implications, by Jane Leggett.
7 Methane’s ability to trap heat in the atmosphere is 21 times that of CO2; nitrous oxide is
310 times that of CO2 (measured over a 100-year period). Intergovernmental Panel on
Climate Change (IPCC), Climate Change 2007, Technical Summary of the Working Group
I Report, Table TS-2, at [http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_TS.pdf].
8 USDA, U.S. Agriculture and Forestry Greenhouse Gas Inventory: 1990-2001, TB1907,
Figure 3-6, March 2004, at [http://www.usda.gov/oce/global_change/gg_inventory.htm].
Nitrogen-fixing crops refer to beans, legumes, alfalfa, and non-alfalfa forage crops.
9 EPA’s 2007 Inventory, Table ES-2. Other major CH4 sources were landfills, natural gas
systems, and coal mining. Mobile combustion was the second largest source of N2O.
10 EPA’s 2007 Inventory, Table 6-2. NOX and CO influence the levels of tropospheric
ozone, which is both a local pollutant and a GHG (called “indirect” greenhouse gases). Their
not included in EPA’s annual Inventory estimates because they contribute only
indirectly to climate change by influencing tropospheric ozone, which is a
greenhouse gas. Agricultural activities may also release other types of air emissions,
some of which are regulated under the federal Clean Air Act, including ammonia,
volatile organic compounds, hydrogen sulfide, and particulate matter.11 These types
of emissions are typically not included in proposals to limit GHG emissions.
The sector also emits CO2 and other gases through its on-farm energy use, for
example, through the use of tractors and other farm machinery. These emissions are
generally aggregated along with other transportation and industrial emissions in the
“energy” sources, where they constitute a very small share of the overall total.
Therefore, these emissions are not included in reported estimates for the U.S.
Total GHG Emissions. In 2005, GHG emissions from U.S. agricultural
activities totaled nearly 540 MMTCO2-Eq., expressed in terms of CO2-equivalent
units, and accounted for about 7% of the total GHG emissions in the United States
(Table 1).12 Although the agriculture sector is a leading economic sector
contributing to national GHG emissions, its share of total emissions is a distant
second compared to that for the energy sector. Fossil fuel combustion is the leading
source of GHG emissions in the United States (about 80%), with the energy sector
generating 85% of annual emissions across all sectors.13
Recent trends in GHG emissions associated with the U.S. agriculture sector
suggest emissions reductions in recent years. In 2005, emissions from agricultural
activities were lower compared to estimates for 2000 and the most recent five-year
average. However, emissions in 2005 were higher compared to reported emissions
for 1990 and 1995 (Table 1).
Uncertainty Estimating Emissions. EPA’s estimates are based on annual
USDA data on crop production, livestock inventories, and information on
conservation and land management practices in the agriculture sector. Actual
emissions will depend on site-specific factors, including location, climate, soil type,
type of crop or vegetation, planting area, fertilizer and chemical application, tillage
practices, crop rotations and cover crops, livestock type and average weight, feed mix
and amount consumed, waste management practices (e.g., lagoon, slurry, pit, and
contributions cannot be measured by emissions.
11 See CRS Report RL32948, Air Quality Issues and Animal Agriculture: A Primer, by
Claudia Copeland. Particulate emissions may also contribute to climate change, but their
influence is predominantly local, short-term and poorly quantified.
12 EPA’s 2007 Inventory, Table 2-14 and Table 6-1.
13 Aside from the energy and agriculture/forestry sectors, by source, other leading
contributors are wood biomass/ethanol use (3%); nonenergy use of fuel; landfills; and
substitution of ozone-depleting substances (2% each). By sector, leading sources are
industrial processes (5%) and wastes (2%). EPA’s 2007 Inventory, Tables ES-2 and ES-4.
drylot systems), and overall farm management. Emissions may vary year to year
depending on actual growing conditions. The EPA-reported data reflect the most
recent data and historical updates, and reflect underlying methodological changes, in
keeping with Intergovernmental Panel on Climate Change (IPCC) guidelines.14 More
detailed information is in EPA’s 2007 Inventory.
Table 1. GHG Emissions and Carbon Sinks,
Agricultural Activities, 1990-2005 (CO2-Equivalent)
So urce 1990 1995 2000 2005 2001-2005
million metric tons CO2 equivalent (MMTCO2-Eq)
U.S. Agricultural Activities
GHG Emissions (CH4 and N2O)a
Agriculture Soil Management366.9353.4376.8365.1370.9b
Agricultural Residue Burning18.104.22.168.41.2
Subt o t a l 530.3 526.8 547.4 536.3 540.1
Othe nananana na
Subt o t a l (33.9) (30.1) (29.3) (32.4) (31.7)
Net Emissions, Agriculture496.4496.7518.1503.9508.4
Attributable CO2 emissions:c46.857.350.945.552.6
Fossil fuel/mobile combustion
%All Emissions, Agricultured8.5%8.0%7.7%7.4%8.0%
%Total Sinks, Agriculture4.8%3.6%3.9%3.9%4.0%
%Total Emissions, Forestry0.2%0.2%0.2%0.3%0.3%e
%Total Sinks, Forestry94.3%92.0%94.8%94.7%95.0%
Total GHG Emissions, All Sectors6,242.06,571.07,147.27,260.46,787.1
Total Carbon Sinks, All Sectors(712.8)(828.8)(756.7)(828.5)(801.0)
Net Emissions, All Sectors5,529.25,742.26,390.56,431.95,986.1
Source: EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2005, April 2007,
[http://epa.gov/climatechange/emissions/usinventoryreport.html]. Table ES-2, Table 2-13, Table 6-1,
Table 7-1, and Table 7-3. EPA data are reported in teragrams (Tg.), which are equivalent to one
million metric tons each.
a. N2O emissions from soil management and nutrient/chemical applications on croplands.
b. CH4 emissions from ruminant livestock.
c. Emissions from fossil fuel/mobile combustion associated with energy use in the U.S. agriculture
sector (excluded from EPA’s reported GHG emissions for agricultural activities).
d. Does not include attributable CO2 emissions from fossil fuel/mobile combustion.
e. Change in forest stocks and carbon uptake from urban trees and landfilled yard trimmings.
14 The IPCC was established to assess scientific, technical and socioeconomic information
related to climate change, its potential impacts and options for adaptation and mitigation.
IPCC’s methodolgy to estimate emissions and sinks are consistent with those used by other
governments and with established guidelines under the United Nations Framework
Convention on Climate Change.
Other Estimated Emissions. EPA’s reported emissions for the U.S.
agriculture sector are based on agricultural production only and do not include15
emissions associated with on-farm energy use and forestry activities, or emissions
associated with food processing or distribution. Although EPA’s GHG estimates for
the U.S. agriculture sector do not include CO2 emissions from on-farm energy use,
estimates of these CO2 emissions constitute a small share of overall GHG emissions.
During the last few years, EPA’s estimates of CO2 emissions from on-farm fossil fuel
and mobile combustion averaged about 50 MMTCO2-Eq. per year16 (Table 1).
These emissions are generally aggregated with emissions for the transportation and
industrial sectors. Even if these emissions were included with other attributed GHG
emissions for the agriculture sector, this would not substantially raise agriculture’s
overall share of total GHG emissions.
Sources of GHG Emissions. EPA’s Inventory estimates of CH4 and N2O
emissions from agricultural activities are measured across five categories.
!Agriculture soil management: Nitrous oxide emissions from
farmland soils are associated with cropping practices that disturb
soils and increase oxidation, which can release emissions into the
atmosphere. The types of practices that contribute to emissions
releases are fertilization; irrigation; drainage; cultivation/tillage;
shifts in land use; application and/or deposition of livestock manure
and other organic materials on cropland, pastures, and rangelands;
production of nitrogen-fixing crops and forages; retention of crop
residues; and cultivation of soils with high organic content.
!Enteric fermentation: Methane emissions from livestock
operations occur as part of the normal digestive process in ruminant
animals17 and are produced by rumen fermentation in metabolism
and digestion. The extent of such emissions is often associated with
the nutritional content and efficiency of feed utilized by the animal.18
Higher feed effectiveness is associated with lower emissions.
!Manure management: Methane and nitrous oxide emissions
associated with manure management occur when livestock or
poultry manure is stored or treated in systems that promote anaerobic
decomposition, such as lagoons, ponds, tanks, or pits.
!Rice cultivation: Methane emissions from rice fields occur when
fields are flooded and aerobic decomposition of organic material
gradually depletes the oxygen in the soil and floodwater, causing
anaerobic conditions to develop in the soil, which releases methane.
15 Land use and forestry activities account for less than 1% of total estimated GHG
emissions in the United States (EPA’s 2007 Inventory, Table ES-4). See Table 1.
16 EPA’s 2007 Inventory, Table 2-14.
17 Refers to livestock (cattle, sheep, goats, and buffalo) that have a four-chambered stomach.
In the rumen chamber, bacteria breaks down food and degrades methane as a byproduct.
18 R. A. Leng, “Quantitative Ruminant Nutrition — A Green Science,” Australian Journal
of Agricultural Research, 44: 363-380. Feed efficiency based on both fermentive digestion
in the rumen and conversion of feed to output (e.,g, milk, meat) as nutrients are absorbed.
!Agricultural residue burning: Methane and nitrous oxide
emissions are released by burning residues or biomass.19
The share of GHG emissions for each of these categories is as follows:
agriculture soil management (68% of emissions), enteric fermentation (21%), manure
management (10%), rice cultivation (1%), and field burning of agricultural residues
(less than 1%). Approximately 70% of agricultural emissions are associated with the
crop sector and about 30% with the livestock sector (Figure 1).20
Figure 1. Agricultural GHG Emissions, Average 2001-2005
Manure Mgmt Manure Mgmt
(N2O) 2%(CH4) 8%Rice
Ag Residue (CH4) 1%
(CH4 , N2O)
Enteric Ag Soil Mgmt
Fermentation (NO) 68%
Source: EPA, 2007 Inventory report, April 2007, at [http://epa.gov/climatechange/
e mi ssi o ns/ usi nve nt o r yr e p o r t . ht ml ] .
Potential for Additional Reductions. There is potential to lower carbon,
methane, and nitrous oxide emissions from U.S. agricultural facilities at both crop
and livestock operations through further adoption of certain conservation and land
management practices. In most cases, such practices may both reduce emissions and
sequester carbon in agricultural soils.
Improved Soil Management. Options to reduce nitrous oxide emissions
associated with crop production include improved soil management, more efficient
fertilization, and implementing soil erosion controls and conservation practices. In
the past 100 years, intensive agriculture has caused a soil carbon loss of 30%-50%,
19 Although carbon is released as well, it is predominantly absorbed again within a year as
part of the cropping cycle, and so is assumed to be net zero emissions unless some goes into
long-term soil carbon content.
20 Previously estimates for the agriculture soil management category were lower. Current
EPA estimates reflect methodological and input data changes.
mostly through traditional tillage practices.21 In contrast, conservation tillage
practices preserve soil carbon by maintaining a ground cover after planting and by
reducing soil disturbance compared with traditional cultivation, thereby reducing soil
loss and energy use while maintaining crop yields and quality. Practices include no-
till and minimum, mulch, and ridge tillage. Such tillage practices reduce soil
disturbance, which reduces oxidation and the release of carbon into the atmosphere.
Therefore, conservation tillage practices reduce emissions from cultivation and also
enhance carbon sequestration in soils (discussed later in this report). Nearly 40% of
U.S. planted areas are under some type of conservation tillage practices.22
Improved Manure and Feed Management. Methane emissions associated
with livestock production can be reduced through improved manure and feed
management. Improved manure management is mostly associated with installing
certain manure management systems and technologies that trap emissions, such as23
an anaerobic digester or lagoon covers. Installing such systems generates other
principal environmental benefits. Installing an anaerobic digester to capture
emissions from livestock operations, for example, would also trap other types of air
emissions, including air pollutants such as ammonia, volatile organic compounds,
hydrogen sulfide, nitrogen oxides, and particulate matter that are regulated under the
federal Clean Air Act. Other benefits include improved water quality through reduced
nutrient runoff from farmlands, which may be regulated under the federal Clean
Water Act.24 Many manure management systems also control flies, produce energy,
increase the fertilizer value of any remaining biosolids, and destroy pathogens and
Manure management systems, however, can be costly and difficult to maintain,
given the typically high start-up costs and high annual operating costs. For example,
the initial capital cost of an anaerobic digester with energy recovery is between $0.5
million and $1 million at a large-sized dairy operation, and annual operating costs are
about $36,000. Initial capital costs for a digester at a larger hog operation is about
21 D. C. Reicosky, “Environmental Benefits of Soil Carbon Sequestration,” USDA, at
[http://www.dep.state.pa.us/dep/DEPU T AT E/ Watermgt/wsm/WSM_T AO/InnovT e chFor
um/InnovT echForum-IIE -R e i c o s k y .pdf].
22 USDA, “Conservation Tillage Firmly Planted in U.S. Agriculture,” Agricultural Outlook,
March 2001; USDA, “To Plow or Not to Plow? Balancing Slug Populations With
Environmental Concerns and Soil Health,” Agricultural Research, October 2004;
Conservation Technology Information Center (CTIC), “Conservation Tillage Facts,” at
[http://www.conserva ti oninformation.org/ ?action=lear ningcenter_core4_convotill].
23 An enclosed tank that promotes decomposition using anaerobic conditions and naturally
occurring bacteria, while producing biogas as a byproduct that can be used as energy.
24 See CRS Report RL32948, Air Quality Issues and Animal Agriculture: A Primer; and
CRS Report RL31851, Animal Waste and Water Quality: EPA Regulation of Concentrated
Animal Feeding Operations (CAFOs), by Claudia Copeland.
25 R. Pillars, “Farm-based Anaerobic Digesters,” Michigan State University Extension, at
[http://web2.msue.ms u.edu/manure/Fina lAnearobicDigestionFactsheet.pdf].
$250,000, with similar operating costs.26 Upfront capital costs tend to be high
because of site-specific conditions at an individual facility, requiring technical and
engineering expertise. Costs will vary depending on site-specific conditions but may
also vary by production region. Costs may be higher in areas with colder
temperatures, where some types of digesters may not be appropriate or may require
an additional heat source, insulation, or energy requirements to maintain constant,
elevated temperatures.27 Energy requirements to keep a digester heated are likely be
lower in warmer climates.
Incentives are available to assist crop and livestock producers in implementing
practices and installing systems that may reduce GHG emissions. Such incentives
include cost-sharing and also low-interest financing, loan guarantees, and grants, as
well as technical assistance with implementation. Funding for anaerobic digesters at
Figure 2. National Distribution of Anaerobic Digester
Energy Production, Operating and Planned
26 EPA, Development Document for the Final Revisions to the NPDES Regulation and the
Effluent Guidelines for Concentrated Animal Feeding Operations, January 2003.
27 C. Henry and R. Koelsch, “What Is an Anaerobic Digester?” University of Nebraska,
Lincoln, at [http://files.harc.edu/Sites/GulfcoastCHP/Publications/WhatIsAnaerobic
Digestion.pdf]; and Pennsylvania State University, “Biogas and Anaerobic Digestion,” at
[http://www.biogas.psu.edu/]. For optimum operation, anaerobic digesters must be kept at
a constant, elevated temperature, and any rapid changes in temperature could disrupt
U.S. livestock operations occurs under various programs under the 2002 farm bill.28
Despite the availability of federal and/or state-level cost-sharing and technical
assistance, adoption of such systems remains low throughout the United States. There
are currently about 100 digester systems in operation or planned at commercial dairy
and hog farms, accounting for about 1% of all operations nationwide (Figure 2).29
Source: Adapted by CRS, Map Resources (7/2007) from data reported by USEPA,
AgStar Digest, Winter 2006.
Improved feed strategies may also lower methane emissions at livestock
operations. Such strategies may involve adding supplements and nutrients to animal
diets, substituting forage crops for purchased feed grains, or instituting multi-phase
feeding to improve digestive efficiency. Other options involve engineering genetic
improvements in animals.30 Purchasing feed supplements and more intensely
managing animal nutrition and feeding practices may add additional costs and
management requirements at the farm level.
Agricultural Carbon Sinks
Carbon Loss and Uptake. Agriculture can sequester carbon, which may
offset GHG emissions by capturing and storing carbon in agricultural soils. On
agricultural lands, carbon can enter the soil through roots, litter, harvest residues, and
animal manure, and may be stored primarily as soil organic matter (SOM; see Figure
3).31 Soils can hold carbon both underground in the root structure and near the soil
surface and in plant biomass. Loss of soil carbon may occur with shifts in land use,
with conventional cultivation (which may increase oxidation), and through soil
erosion. Carbon sequestration in agricultural soils can be an important component
of a climate change mitigation strategy, since the capture and storage of carbon may
limit the release of carbon from the soil to the atmosphere.
28 Mostly Section 9006 and Section 6013 of the farm bill (P.L. 107-171), but also under
other farm bill cost-share programs. CRS communication with USDA staff.
29 As of 2005. EPA, AgStar Digest, Winter 2006, at [http://www.epa.gov/agstar/].
30 R. A. Leng, “Quantitative Ruminant Nutrition — A Green Science,” Australian Journal
of Agricultural Research, 44: 363-380; H. Steinfeld, C. de Haan, and H. Blackburn,
Livestock-Environment Interactions, Issues and Options, chapter 3 (study commissioned by
the Commission of the European Communities, United Nations, and World Bank), at
[ h t t p : / / www.vi r t ual cent r e.or g/ es/ d ec/ t ool box/ FAO/ Summa r y/ i ndex.ht m] .
31 U.S. Geological Survey (USGS), website information on carbon sequestration in soils.
Figure 3. Carbon Sequestration in
Source: USGS, “Carbon Sequestration in Soils.”
SOM = Soil organic matter
Voluntary land retirement programs and programs that convert or restore
grasslands and wetlands promote carbon capture and storage in agricultural soils.
Related practices include afforestation (including the conversion of pastureland and
cropland), reforestation, and agro-forestry practices. Conservation practices that raise
biomass retention in soils and/or reduce soil disturbance, such as conservation tillage
and/or installing windbreaks and buffers, also promote sequestration. More detailed
information is provided in the following section, “Mitigation Strategies in the
Total Carbon Sequestration. In 2005, carbon sequestration by agricultural
soils was estimated at about 30 MMTCO2-Eq.32 Compared to estimates for the most
recent five-year average, as well as estimates for 1995 and 2000, recent data show
possible gains in carbon uptake and storage in recent years (Table 1).
The agriculture and forestry sectors are a small part of the overall carbon
sequestration debate. Carbon sequestration by these sectors is usually referred to as
indirect or biological sequestration.33 Biological sequestration is considered to have
32 EPA’s 2007 Inventory, Table 2-14 and Table 7-1. Based on estimates for the following
categories: land converted to grassland; grassland remaining grassland; land converted to
cropland; cropland remaining cropland.
33 Congressional Budget Office (CBO), The Potential for Carbon Sequestration in the
United States, Sept. 2007, at [http://www.cbo.gov/ftpdocs/86xx/doc8624/09-12-Carbon
Sequestration.pdf]. Biological sequestration refers to the use of land to enhance its ability
to uptake carbon from atmosphere through plants and soils. Direct sequestration refers to
capturing carbon at its source and storing it before its release to the atmosphere. Examples
include capture and storage in geologic formations, such as oil fields, natural gas fields, coal
seams, and deep saline formations. See CRS Report RL33801, Carbon Capture and
Sequestration (CCS), by Peter Folger.
less potential for carbon sequestration than direct sequestration, also referred to as
carbon capture and storage, and is typically associated with oil and gas production.
Estimated Emission Offsets. Carbon sequestration in the U.S. agriculture
sector currently offsets only about 5% of the carbon-equivalent of reported GHG
emissions generated by the agriculture sector each year. Thus the sector remains a
net source of GHG emissions. Compared to total national GHG emissions, the
agriculture sector offsets well under 1% of emissions annually. It should be noted
that these estimates do not include estimates for the forestry sector, or sequestration
activities on forested lands or open areas that may be affiliated with the agriculture
sector. Forests and trees account for a majority (about 95%) of all estimated carbon
uptake in the United States, mostly through forest restoration and tree-planting.34
Carbon uptake in soils on U.S. agricultural lands accounts for the bulk of the
Uncertainty Estimating Carbon Sinks. EPA’s Inventory estimates of
carbon uptake in agricultural soils are based on annual data and information on
cropland conversion to permanent pastures and grasslands, reduced summer fallow
areas in semi-dry areas, increased conservation tillage, and increased organic
fertilizer use (e.g, manure) on farmlands, as well as information on adoption rates and
use of certain conservation and land management practices.
However, actual carbon uptake in agricultural soils depends on several site-
specific factors, including location, climate, land history, soil type, type of crop or
vegetation, planting area, tillage practices, crop rotations and cover crops, and farm
management in implementing certain conservation and land management practices.
Estimates of the amount of carbon sequestered may vary depending on the amount
of site-specific information included in the estimate, as well as on the accounting
procedures and methodology used to make such calculations.
In general, the effectiveness of adopting conservation and land management
practices will depend on the type of practice, how well the practice is implemented,
and also on the length of time a practice is undertaken. For example, time is needed
for a certain conservation practice to take hold and for benefits to accrue, such as
buildup of carbon in soils from implementing conservation tillage or other soil
management techniques, and growing time for cover crops or vegetative buffers. The
overall length of time the practice remains in place is critical, especially regarding the
sequestration benefits that accrue over the time period in which land is retired. In
addition, not all conservation and land management practices are equally effective
or appropriate in all types of physical settings. For example, the use and
effectiveness of conservation tillage practices will vary depending on soil type and
moisture regime, which may discourage some farmers from adopting or continuing
this practice in some areas.
34 EPA’s 2007 Inventory, Table 2-14 and Table 7-1. Based on estimates for the following
categories: forestland remaining forestland; and growth in urban trees. Other uptake not
included in the estimates is from landfilled yard trimmings.
The potential impermanence of conservation and land management practices
raises concerns about the effectiveness and limited storage value of the types of
conservation practices that sequester carbon, given that the amount of carbon stored
depends on the willingness of landowners to adopt or continue to implement a
particular voluntary conservation practice. There are also concerns that the addition
of other conservation practices may not significantly enhance the sequestration
potential of practices that might already be in place.35 This raises questions about the
cost-effectiveness of sequestering carbon on farmlands relative to other climate
change mitigation strategies in other industry sectors. Finally, implementing
conservation practices and installing new technologies may be contingent on
continued cost-sharing and other financial incentives contained in the current farm
bill; programs funded through this legislation help offset the cost to farmers for these
practices and technologies, which some farmers may not be willing to do otherwise.
Potential for Additional Uptake. USDA reports that the potential for
carbon uptake in agricultural soils is much greater than current rates. USDA forecasts
that the amount of carbon sequestered on U.S. agricultural lands will more than
double from current levels by 2012, adding roughly an additional 40 MMTCO2-Eq.36
of sequestered carbon attributable to the sector. This additional uptake is expected
through improved soil management (roughly 60%), improved manure and nutrient
management (about 30%), and additional land-retirement sign-ups (about 10%).
Other longer-term estimates from USDA report that the potential for net
increases in carbon sequestration in the agriculture sector could range from 40 to 59037
MMTCO2-Eq. per year, or roughly 2-20 times current levels. Afforestation, or the
creation of forested areas mostly through conversion of pastureland and cropland,
reflects the majority of the estimated uptake potential, with agricultural soil carbon
sequestration accounting for a smaller share at the high end of this estimated range.
Comparable estimates reported by EPA forecast a higher sequestration potential for
the U.S. agriculture sector, ranging from 160 to 990 MMTCO2-Eq. per year.38 EPA
also reports additional sequestration potential from livestock manure management,
biofuels substitution, and forest land management. Estimates from various studies
may differ depending on the extent that estimates may include sequestration activities
in the forestry sector. Combined, the potential carbon uptake from both the
35 See, for example, T. A. Butt and B. A. McCarl, “Implications of Carbon Sequestration for
Landowners,” 2005 Journal of the American Society of Farm Managers and Rural
Appraisers; Government Accountability Office (GAO), Conservation Reserve Program:
Cost-Effectiveness Is Uncertain, March 1993; H. Feng, J. Zhao, and C. Kling, “Carbon: Thend
Next Big Cash Crop,” Choices, 2 quarter 2001; and H. Feng, C. Kling, and P. Glassman,
“Carbon Sequestration, Co-Benefits, and Conservation Programs,” Choices, Fall 2004.
36 W. Hohenstein, “USDA Activities to Address Greenhouse Gases and Carbon
Sequestration,” presentation to Senate Energy Committee staff, February 15, 2007.
37 USDA, Economics of Sequestering Carbon in the U.S. Agricultural Sector, April 2004.
38 EPA, Greenhouse Gas Mitigation Potential in U.S. Forestry and Agriculture, Tables 4-10
and 4-5, Nov. 2005, at [http://www.epa.gov/sequestration/greenhouse_gas.html].
agriculture and forestry sectors is estimated from 800 to 1,200 MMTCO2-Eq. per
An additional carbon uptake potential of 590 to 990 MMTCO2-Eq. per year
would more than offset the agriculture sector’s annual GHG emissions, or offset 8%
to 14% of total current national emissions from all sources. Currently, carbon uptake
in agricultural soils sequesters under 1% of total national GHG emissions annually
(Table 1). An estimated 11% of all GHG emissions are currently sequestered
annually, with the bulk sequestered through growth in forest stocks.
Per-Unit Value Estimates. Compared to other mitigation options in other
sectors, USDA reports that U.S. agriculture can provide low-cost opportunities to
sequester additional carbon in soils and biomass. The estimated per-unit value (or
cost) of carbon removed or sequestered, expressed on a dollar per metric ton (mt) of
carbon basis, will vary depending on the type of practice. Actual per-unit values and
the cost-effectiveness of different practices may vary considerably from site to site.
USDA’s estimate of an additional carbon uptake potential of 40 to 590
MMTCO2-Eq. per year is associated with a range of costs from about $3/mt to
$35/mt of permanently sequestered carbon dioxide (Table 2).40 The low end of this
range reflects the sequestration potential associated with cropland management
practices; higher-end values are associated with land retirement and conversion, and
a longer sequestration tenure. USDA’s report also notes that if producers discontinue
the land and cropland management practices at the end of a typical contract period,
the carbon sequestered may only be worth a small share of its overall program costs,
because most of the carbon will be released when these practices are terminated,
which may lower the cost-effectiveness of such programs. EPA’s forecast of an
additional sequestration potential for the agriculture sector of 160 to 990 MMTCO2-
Eq. per year are estimated across a range of $5/mt-$30/mt of sequestered carbon41
dioxide. The low end of this range is associated with sequestration in agricultural
soils and with soil management practices; high-end values are associated with
afforestation, or converting open land into a forest by planting trees or their seeds.
Table 2. Carbon Sequestration Potential in the U.S. Agriculture
Sector, Alternative Scenarios and Payment Levels
(dollars per million metric ton of sequestered CO2)
Source$3-5 range$14-15 range$30-34 range
(million mt of sequestered CO2)
Afforestation 0 - 31 105 - 264 224 - 489
39 As summarized by CBO, The Potential for Carbon Sequestration in the United States,
Sept. 2007, at [http://www.cbo.gov/ftpdocs/86xx/doc8624/09-12-CarbonSequestration.pdf].
40 USDA, Economics of Sequestering Carbon in the U.S. Agricultural Sector, April 2004
(measured by the amount of carbon sequestered over a 15-year time period across a range
of costs). USDA estimates that the associated total cost to sequester carbon across this
range is $0.95 billion to $2 billion per year.
41 EPA, Greenhouse Gas Mitigation Potential in U.S. Forestry and Agriculture, Table 4-10.
Agricultural soil carbon sequestration 0.4 - 4 3 - 30 13 - 95
Total 0.4 - 35 108 - 295 237 - 587
Affo restatio n 1 2 228 806
Agricultural soil carbon sequestration149204187
To t a l 161 432 994
Sources: EPA, Greenhouse Gas Mitigation Potential in U.S. Forestry and Agriculture, Nov. 2005,
Table 4-10, at [http://www.epa.gov/sequestration/greenhouse_gas.html]. Compares USDA estimates
(Economics of Sequestering Carbon in the U.S. Agricultural Sector, Apr. 2004) with EPA estimates.
Enhancing Carbon Sinks. There is potential to increase the amount of
carbon captured and stored in U.S. agricultural lands by adopting certain
conservation and land management practices. In most cases, such practices may both
sequester carbon in farmland soils and reduce emissions from the source. Table 3
shows estimated representative carbon sequestration rates for agricultural practices.
Improved Soil and Land Management. The main carbon sinks in the
agriculture sector are cropland conversion and soil management, including improved42
manure application. More than half of all carbon sequestered on U.S. agricultural
lands is through voluntary land retirement programs and programs that convert or
restore land (e.g., conversion to open land or grasslands, conversion to cropland,
restoration of grasslands or wetlands, etc.). Undisturbed open lands, grasslands and
wetlands can hold carbon in the soil both underground in the root structure and above
ground in plant biomass. The amount of carbon sequestered will vary by the type of
land management system. Afforestation and cropland conversion have the greatest
potential to store the most carbon per acre annually, compared with other types of43
systems, such as tree plantings and wetlands conversion, or storage in croplands.
Conservation tillage is another major source of sequestration on farmlands,
accounting for about 40% of the carbon sequestered by the U.S. agriculture sector.44
Improved tillage practices improve biomass retention in soils and reduce soil
disturbance, thereby decreasing oxidation. The amount of carbon sequestered will
vary by the type of tillage system: reduced tillage stores between 0.6-1.1 mt of carbon
dioxide per acre annually (Table 3). Among conservation tillage practices, no-till
stores about 30% more than the amount of carbon stored by reduced tillage but more
than five times that stored on intensive tilled croplands. (Conservation tillage
practices are explained in the section on “Potential for Additional Reductions”).
Table 3. Representative Carbon Sequestration Rates
42 USDA, U.S. Agriculture and Forestry Greenhouse Gas Inventory: 1990-2001, TB1907,
Figure 3-8, March 2004, at [http://www.usda.gov/oce/global_change/gg_inventory.htm].
43 Bongen, A.,”Using Agricultural Land for Carbon Sequestration,” Purdue University, at
[http://www.agry.purdue.edu/soils/Csequest.PDF]. 1999 data for carbon storage in Indiana.
44 USDA, U.S. Agriculture and Forestry Greenhouse Gas Inventory: 1990-2001, TB1907,
March 2004, at [http://www.usda.gov/oce/global_change/gg_inventory.htm]; USDA,
“Depositing Carbon in the Bank: The Soil Bank, That Is,” Agricultural Research, Feb. 2001.
Type of land Management SystemSequestration Rate
Afforestation2.2 - 9.5
Reforestation1.1 - 7.7
Reduced tillage (e.g., no-till, reduced-till)0.6 - 1.1
Change in grassland management0.07 - 1.9
Cropland conversion to grassland0.9 - 1.9
Riparian buffers (nonforest)0.4 - 1.0
Biofuel substitution for fossil fules4.8 - 5.5
Source: Compiled by EPA, Greenhouse Gas Mitigation Potential in U.S. Forestry and Agriculture,
Table 2-1, Nov. 2005, at [http://www.epa.gov/sequestration/greenhouse_gas.html]. Saturation rates
and duration periods apply. EPA’s report provides a list of the original source citations.
Improved Manure and Feed Management. Mitigation strategies at U.S.
livestock operations are not commonly associated with carbon uptake and are not
included in EPA’s carbon sink estimates. However, installing manure management
systems, such as an anaerobic digester, captures and/or destroys methane emissions
from livestock operations and may be regarded as avoided emissions or as a form of
direct sequestration capturing emissions at the source. As a result, some carbon offset
programs are beginning to promote manure management systems as a means to
capture and store methane at dairy operations, which may also be sold as carbon
offset credits and as a renewable energy source.45 Given that there are currently few
anaerobic digesters in operation, estimates of the actual or potential uptake may be
difficult to estimate. (Manure management systems are further explained in the
section on “Potential for Additional Reductions.”)
Mitigation Strategies in the Agriculture Sector
Existing conservation and farmland management programs administered at both
the federal and state levels often encourage the types of agricultural practices that can
reduce GHG emissions and/or sequester carbon. These include conservation,
forestry, energy, and research programs within existing farm legislation. These
programs were initiated predominantly for other production or environmental
purposes, and few specifically address climate change concerns in the agriculture and
forestry sectors. However, some USDA and state-level programs have started to
place additional attention on the potential for emissions reduction and carbon storage
under certain existing programs.
Agricultural conservation and other farmland practices broadly include land
management, vegetation, and structures that can also reduce GHG emissions and/or
sequester carbon, such as:
45 See Iowa Farm Bureau’s carbon credit project at [http://www.iowafarmbureau.com].
!land retirement, conversion, and restoration (e.g., conversion to
grasslands, restoration of grasslands or wetlands, etc.);
!soil conservation practices, including conservation tillage (e.g.,
reduced/medium- till, no/strip-till, ridge-till);
!soil management and soil erosion controls;
!precision agriculture practices and recognized agricultural best
!efficient fertilizer/nutrient (incl. manure) and chemical application;
!manure management (e.g., improve manure storage and technologies
using anaerobic digestion and methane recovery);
!feed management (e.g., improve feed efficiency, dietary
!rotational grazing and improved forage/grazing management;
!vegetative and riparian buffers, and setbacks;
!windbreaks for crops and livestock;
!bioenergy and biofuels substitution and renewable energy use (e.g.,
replacing use of fossil fuels); and
!energy efficiency and energy conservation on-farm.
In general, conservation programs administered by USDA and state agencies
encourage farmers to implement certain farming practices and often provide financial
incentives and technical assistance to support adoption. Participation in these
programs is voluntary, and farmers may choose to discontinue participating in these
programs. The effectiveness of these practices depends on the type of practice, how
well the practice is implemented, and also on the length of time a practice is
undertaken. These programs are generally designed to address site-specific
improvements based on a conservation plan developed with the assistance of USDA
or state extension technical and field staff that considers the goals and land resource
base for an individual farmer or landowner. Such a conservation plan is typically a
necessary precursor to participating in USDA’s conservation programs.
Conservation Programs. Conservation programs administered by USDA
are designed to take land out of production and to improve land management
practices on land in production, commonly referred to as “working lands” (Table 4).
These programs are provided for in Title II (Conservation) of the 2008 farm bill.
!Land retirement/easement programs. Programs focused on land
management, including programs that retire farmland from crop
production and convert it back into forests, grasslands, or wetlands,
including rental payments and cost-sharing to establish longer term
conservation coverage. Major programs include the Conservation
Reserve Program (CRP), the Wetlands Reserve Program (WRP), the
Grasslands Reserve Program (GRP), the Farmland Protection
Program (FPP), among other programs.
!Working lands programs. Programs focused on improved land
management and farm production practices, such as changing
cropping systems or tillage management practices, are supported by
cost-sharing and incentive payments, as well as technical assistance.
Major programs include the Environmental Quality Incentives
Program (EQIP), the Conservation Stewardship Program (CSP), the
Agricultural Management Assistance (AMA) program, and the
Wildlife Habitat Incentives Program (WHIP).
Prior to the 2008 farm bill, few USDA conservation programs were specifically
intended to address climate change concerns in the agriculture sector. One exception
is USDA’s Conservation Innovation Grants program, a subprogram under EQIP that
provides for competitive awards, and is intended to accelerate technology transfer
and adoption of innovative conservation technologies, mostly through pilot projects
and field trials. Past grants have supported development of approaches to reduce
ammonia emissions from poultry litter, promote conservation tillage and solar energy46
technologies, and develop private carbon sequestration trading credits.
Table 4. Conservation and Land Management Practices
USDAConservation Practice andBenefits for Climate
ProgramLand ManagementGeneral BenefitsChange
Conservation tillage and reduced fieldImproves soil/water/air quality.Sequestration,
pass intensityReduces soil erosion/fuel use.emission reduction
EQIP,Crop diversity through crop rotationsReduces erosion/water needs.Sequestration
CSP,and cover croppingImproves soil/water quality.
AMAEfficient nutrient (nitrogen)Improves water quality. SavesSequestration,
management, fertilizer applicationexpenses, time, and labor.emission reduction
Improved soil management and soilImproves soil/water/air quality.Sequestration,
erosion controlsemission reduction
EQIPManure management (e.g.,Improves soil/water/air quality.Emission reduction
CSPstorage/containment, anaerobicOn-farm fuel cost-savings.
AMAadigestion and methane recovery)Alternative income source.
OtherNutrients for crops.
Feed management (e.g., raise feedImproves water/air quality. MoreEmission reduction
EQIPefficiency, dietary supplements)efficient use of feed.
AMARangeland management (e.g.,Reduces water requirements.Sequestration,
rotational grazing, improved forage)Helps withstand drought. Raisesemission reduction
EQIPWindbreaks for crops and livestock,Improves crop/livestock protectionSequestration,
CSPvegetative/riparian buffers, grassedand wildlife habitat. Alternativeemission reduction
AMAwaterways, setbacks, etc. income source (e.g., hunting fees).
46 USDA, “Reducing Agricultural Greenhouse Gas Emissions Through Voluntary Action,”
Statement by Bruce Knight of USDA’s Natural Resources Conservation Service at the
United Nations Framework Convention on Climate Change, December 2004, at
EQIPAgroforestry / silvopasture withProvides income from grazing andSequestration,
CSProtational grazing and improvedwood products.emission reduction
AM A fo r a ge
CRPLand management, includingImproves soil/water/air quality.Sequestration
WRPretirement, conversion, restoration
GRP (cropland, grasslands, wetlands, open
FP P sp ace)
EQIPEnergy efficiency/conservationImproves soil/water/air quality.Emission reduction
CSP Co st -sa vi ngs.
OtherBiofuel substitution and renewableImproves soil/water/air quality.Emission reduction
energy useOn-farm fuel cost-savings.
Alternative income source.
Source: Compiled by CRS staff from available USDA and EPA information. Listed programs: Conservation Reserve
Program (CRP), Wetlands Reserve Program (WRP), Grasslands Reserve Program (GRP), Farmland Protection Program
(FPP), Environmental Quality Incentives Program (EQIP), Conservation Stewardship Program (CSP), Agricultural
Management Assistance (AMA), Wildlife Habitat Incentives Program (WHIP).
a. Renewable energy projects receive additional program funding in farm bill under Title IX (Energy) and Title VI
(Rural Development), as well as other federal and state program.
However, USDA has considered expanding three of its existing conservation
programs — CRP, EQIP, and CSP — in ways that could further encourage emission47
reductions and carbon sequestration. For example, USDA notes that many of the
practices encouraged under EQIP and CSP reduce net emissions. For EQIP, USDA
is providing additional guidance to technical staff to make GHG a priority resource
concern as part of its ranking system and scoring criteria for participation by, for
example, giving greater weight to projects that promote anaerobic digestion, nutrient
management plans, and other types of cropland practices, such as installing shelter
belts and windbreaks, encouraging conservation tillage, and providing resources for
biomass energy projects. Under CRP, USDA has issued a new rule that explicitly
allows the private sale of carbon credits for land enrolled in the program. It also
modified how it scores and ranks offers to enroll land in CRP in order to place
greater weight on installing vegetative covers that sequester carbon. USDA also has
announced a program under CRP’s continuous enrollment provision to plant up to
lands for sequestering carbon.
Not including funding increases authorized under the 2008 farm bill, actual total
funding in FY2005 for USDA’s conservation programs totaled $5.6 billion.
Voluntary land retirement programs and programs that convert or restore land
account for roughly 37% annually of all USDA conservation spending (Figure 4).
Programs that provide cost-sharing and technical assistance to farmers to implement
certain practices, such as EQIP, CSP, and AMA, provide another 21% annually.
USDA’s conservation technical assistance and extension services account for about
one-fourth of all funding. Other federal funding through other programs also
generally promotes natural resource protection on U.S. farms. Generally, the decision
47 USDA, “USDA Targeted Incentives for Greenhouse Gas Sequestration,” June 6, 2003;
W. Hohenstein, “USDA Conservation Programs are Targeting Greenhouse Gases and
Carbon Sequestration.” Provided to Senate Energy Committee staff, February 15, 2007.
on how and where this funding is ultimately used is made at the individual state level.
Figure 4. USDA Conservation Spending, FY2005
Data & ResearchTechnical
A d minis tr a tion
Ea s e m e n t s
Cost SharePublic Works &
Source: USDA, Office of Budget and Planning.
Note: FY2005 total spending = $5.6 billion.
The new 2008 farm bill (P.L. 110-246, the Food, Conservation, and Energy Act
of 2008) expands several existing conservation programs that contribute to increased
carbon storage in soil and plants, reduced agriculture-based emissions associated with
climate change, lowered energy consumption by farming operations, and increased
production of renewable fuels and feedstocks, among other provisions.
The 2008 farm bill increases funding for both EQIP and CSP, and provides for
expanded eligibility to include management practices on private forest lands and
other natural resource areas. It also provides funding for the Conservation Innovation
Grants program to address air quality concerns from agriculture operations, including
greenhouse gas emissions. The farm bill also makes changes to USDA’s land
retirement programs. Changes to CRP will encourage the establishment of native
vegetation cover on lands set aside or retired from agricultural production, and
promote tree planting and management to improve habitat and encourage healthy
forest growth and carbon uptake. Changes to FPP include expanded eligibility for
forest lands, and changes to GRP include expanded grasslands enrollment and
emphasis on long-term and permanent easement.
The farm bill also creates a new conservation provision to facilitate the
participation of farmers and ranchers in emerging carbon and emissions trading
markets by directing USDA to establish guidelines for standards, accounting
procedures, reporting protocols, and verification processes for carbon storage and
other types of environmental services markets. (This new provision is described in
further detail in the section on “Farm Bill Legislation.”)
Other Farm Programs. Aside from USDA’s conservation programs, there
are other farm bill programs that encourage the types of agricultural practices that can
reduce GHG emissions and/or sequester carbon. These include programs in the farm
bill’s forestry, energy, and research titles.48
Renewable energy projects receive additional program funding across three farm
bill titles: Title II (Conservation), Title IX (Energy), and Title VII (Research). In
addition to cost-sharing provided under USDA’s conservation programs, one energy
title provision in the 2008 farm bill is the so-called Rural Energy for America
Program (Section 9007). This program provides mandatory funding for grants for
energy audits, renewable energy development, and financial assistance to promote
energy efficiency and renewable energy development for farmers and rural small
businesses.49 In the past this program has provided funding to support construction
of anaerobic digesters in the livestock sector.50 Other renewable energy funding is
also available through other federal programs.51 The 2008 farm bill also created the
Biomass Crop Assistance Program to assist in the development of renewable energy
feedstocks, including cellulosic ethanol, and to provide incentives for producers to
harvest, store, and transport biomass. The farm bill’s Title VII (Research) also
provides for research on renewable fuels, feedstocks, and energy efficiency and for
competitive grants for on-farm research and extension projects.
Forestry programs, administered by USDA’s Forest Service, are provided for
in Title VIII (Forestry) of the farm bill. Typically, there is often little overlap
between the various agriculture and forestry programs administered by USDA, and
few forestry programs provide support to agricultural enterprises.52 One program
with an agroforestry component is the Healthy Forests Reserve Program, which was
reauthorized in the 2008 farm bill. This program assists with restoring and enhancing
forest ecosystems; however, funding for this program is usually limited to a few
states. The 2008 farm bill also created new programs with possible agroforestry
benefits, including (1) the Community Forest and Open Space Conservation
48 A previous program in Title VI (Rural Development) that was not reauthorized in the
2008 farm bill was a provision (Section 6013) authorizing rural development business and
industry program to make loans and loan guarantees for renewable energy systems,
including wind energy systems and anaerobic digesters.
49 Previously referred to as Section 9006 (Renewable Energy Systems and Energy Efficiency
Improvements) in the 2002 farm bill.
50 CRS communication with USDA staff, February 8, 2007. Limited information indicates
that USDA funded eight projects totaling more than $60 million under the previous Section
6013 and provided another $20 million in funding assistance under Section 9006 for
anaerobic digesters (FY2002-FY2005).
51 See CRS Report RL34130, Renewable Energy Policy in the 2007 Farm Bill, and CRS
Report RL32712, Agriculture-Based Renewable Energy Production, both by Randy
Schnepf; and CRS Report RL33572, Biofuels Incentives: A Summary of Federal Programs,
by Brent Yacobucci.
52 A previous program that was not reauthorized in the 2008 farm bill was the Forest
Service’s Forest Land Enhancement Program (FLEP). FLEP provided funding for
agriculture and silvopasture practices with rotational grazing and improved forage. Primary
efforts under the program included afforestation and reforestation, improved forest stand,
constructing windbreaks, and riparian forest buffers. For information on USDA forestry
programs, see CRS Report RL33917, Forestry in the 2008 Farm Bill, by Ross W. Gorte.
Program, authorizing new cost-share grants for local governments, tribes, and
non-profits to acquire lands threatened by conversion to non-forest uses; and (2) the
Emergency Forest Restoration Program, providing for the rehabilitation of croplands,
grasslands, and private non-industrial forests following natural disasters. The farm
bill also expanded or created other programs to protect and restore privately owned
forests, which could also contribute to retaining or increasing carbon storage capacity
on forest lands.
State-level agriculture conservation and land management programs are
available to farmers in most states, and operate in much the same manner as federal
conservation programs. These programs may also provide financial and technical
assistance to farmers to implement certain practices, using additional state resources
and in consultation with state agriculture agencies and extension staff. No single
current compendium exists outlining the different types of agriculture conservation
programs across all states; instead information is available through individual state
Many states have cost-share programs that provide financial assistance to
landowners to implement practices that benefit a state’s forests, fish, and wildlife.
Many of these programs provide technical assistance and up to 75% of the eligible
costs of approved conservation projects to qualified landowners. Several states also
provide low-interest financing to farmers and landowners to encourage conservation
practices or to implement best management practices for the agriculture sector. Many
states also have buffer strip programs, which may provide rental payments to
landowners who agree to create or maintain vegetative buffer strips on croplands near
rivers, streams, ponds, and wetlands. Typically states that have taxing authority for
conservation purposes, such as Nebraska, Missouri, and Oregon, tend to have more
stable funding and staffing to support conservation improvements.
The Pew Center on Global Climate Change has identified several ongoing state
programs and demonstration projects specifically intended to promote carbon storage
and emissions reduction in the U.S. agriculture sector.54 For example, several states,
including Oregon, Wisconsin, Vermont, and North Carolina, are promoting methane
recovery and biofuels generation from livestock waste. A program in Iowa is
providing support and funding to promote switchgrass as a biomass energy crop. In
Maryland, income tax credits are provided for the production and sale of electricity
from certain biomass combustion. Georgia has a program that leases no-till
equipment to farmers. In addition, several states, including Nebraska, Oklahoma,
Wyoming, North Dakota, and Illinois, have formed advisory committees to
investigate the potential for state carbon sequestration. In California, an accounting
program is being developed to track possible future costs to mitigate GHG emissions
in the U.S. agriculture sector.
53 State and Local Government directory at [http://www.statelocalgov.net/index.cfm].
54 Pew Center, Learning from State Action on Climate Change, Oct. 2006,
An even greater number of state programs and initiatives are geared toward
climate change mitigation strategies in sectors other than agriculture.55 For example,
many of California’s programs support the state’s recently enacted emission
reductions legislation.56 California’s climate change statute requires state agencies
to identify GHG emissions reduction strategies that can be pursued before most of
the law takes effect in 2012. The state has identified several agriculture sector
strategies that it plans to consider as early actions, including (1) adopting a manure
digester protocol for calculating GHG mitigation; (2) establishing collaborative
research on how to reduce GHG emissions from nitrogen land application; (3)
replacing stationary diesel agricultural engines with electric motors; and (4)
evaluating potential measures for enclosed dairy barns, modified feed management,
and manure removal strategies to reduce methane emissions at dairies.57 These early
action strategies would be in addition to funding for the state’s manure digester cost-
share program and other agriculture projects, including carbon sequestration projects
involving rice straw utilization, energy and water conservation, biofuels support, soil
management, and other types of renewable energy and manure management programs
Other Programs and Incentives
The voluntary carbon offset market allows businesses, interest groups, and
individuals the opportunity to purchase carbon credits generated from projects that
either prevent or reduce an amount of carbon entering the atmosphere, or that capture
carbon from the atmosphere. Companies and individuals purchase carbon credits for
varied reasons. For example, some may purchase credits to reduce their “carbon
footprint,” using credits to offset all or part of a GHG-emitting activity (e.g., air
travel, corporate events, or personal automobile use); others may purchase credits to
bank the reductions in anticipation of a mandatory GHG reduction program.59 In the
United States, the current offset framework operates on a voluntary basis since there
is no federal requirement that GHG emissions be curtailed. Some states and/or
regional GHG reduction initiatives may limit the use of carbon offsets.
55 See CRS Report RL33812, Climate Change: Actions by States to Address Greenhouse
Gas Emissions, by Jonathan L. Ramseur.
56 California’s Global Warming Solutions Act of 2006 (AB 32), which was enacted in
September 2006, codified the state’s goal of requiring California’s GHG emissions be
reduced to 1990 levels by 2020.
57 California Environmental Protection Agency, Expanded List of Early Action Measures
to Reduce Greenhouse Gas Emissions in California Recommended for Board Consideration,
Oct. 2007, at [http://www.arb.ca.gov/cc/ccea/meetings/ea_final_report.pdf].
58 California EPA, “Expanded List of Early Action Measures to Reduce Greenhouse Gas
Emissions in California Recommended for Board Consideration,” October 2007, at
[ ht t p: / / www.ar b.ca.gov/ cc/ ccea/ me et i ngs / ea_f i nal _r e por t .pdf ] .
59 For additional general information on voluntary carbon markets, see CRS Report
RL34241, Voluntary Carbon Offsets: Overview and Assessment, by Jonathan L. Ramseur.
For trading purposes, one carbon credit is considered equivalent to one metric ton of carbon
dioxide emission reduced.
Several states have programs that support the voluntary carbon offset exchange,
often involving U.S. farmers and private landowners. One program operated by the
Iowa Farm Bureau involves more than 1,400 producers in 12 states (mostly Iowa,
Kansas, and Nebraska, but also Illinois, Ohio, Michigan, Wisconsin, Minnesota,
South Dakota, Missouri, Indiana, and Kentucky),60 whose carbon credits may be sold
on the Chicago Climate Exchange.61 Similar types of programs also have been
initiated in North Dakota (operated by the North Dakota Farmers Union), Illinois
(Illinois Conservation and Climate Initiative), Indiana (Environmental Credit
Corporation), and the Northwest (Upper Columbia Resource Conservation and
Development Council). Another, Terrapass, has among its projects two large-scale
dairy farms that use anaerobic digesters and methane capture for energy production.62
Farmer participation in voluntary carbon credit trading programs has been
growing rapidly. As of early 2008, participation involved an estimated 4,000 farmers
across 25-30 states covering more than 4 million acres.63 The two largest programs
providing for farm-based offsets are programs operated by the Iowa Farm Bureau and
the North Dakota Farmers Union.64 Farm-based offset programs generally cover
some or all aspects of the following types of carbon capture and storage activities:
sustainable agriculture practices (such as conservation tillage, grass seedlings);
planting of unharvested grasslands; tree plantings; methane capture/biogas
production with manure digesters; wind, solar, or other renewable energy use;
controlled grasslands or pasture management; and forest restoration. Farmer
participation in such programs may help offset farm costs to install emissions
controls and/or practices that sequester carbon by providing a means for them to earn
and sell carbon credits.
Recent Congressional Action
Congress is considering a range of climate change policy options, including
mandatory GHG emission reduction programs. The current legislative proposals
generally would not require emission reductions in the agriculture and forestry
sectors. However, some of the GHG proposals would allow for regulated entities
(e.g., power plants) to purchase carbon offsets, including those generated in the
60 Iowa Farm Bureau, Carbon Credit Aggregation Pilot Project, at [http://www.
iowafarmbureau.com/special/carbon/]; CRS staff communication with Iowa Farm Bureau
staff, January 2007.
61 The Exchange is a voluntary, self-regulated, rules-based exchange. Its emission offset
program constitutes a small part of its overall program, which includes methane destruction,
carbon sequestration, and renewable energy. See [http://www.chicagoclimatex.com/].
62 For more information, see North Dakota Farmers Union [http://www.ndfu.org], Illinois
Conservation and Climate Initiative [http://www.illinoisclimate.org], Environmental Credit
Corporation [http://www.envcc.com]; and Terrapass [http://www.terrapass.com/projects].
63 CRS estimate based on information from the Iowa Farm Bureau (January 17, 2008).
64 Other similar programs include the Illinois Conservation and Climate Initiative, the
Environmental Credit Corporation (Indiana), the Upper Columbia Resource Conservation
and Development Council (Northwest), and Terrapass (California), among others.
agriculture and forestry sectors. These and related bills and issues are currently being
debated in Congress. Some of these proposals dovetail with provisions that were
enacted as part of the 2008 farm bill, including a provision that directs USDA to
develop guidelines and standards for quantifying carbon storage by the agriculture
and forestry sectors, among other farm bill provisions that indirectly encourage
emissions reductions and carbon capture and storage.
Climate Change Legislation
During the 110th Congress, several proposals have been introduced that would
either mandate or authorize a cap-and-trade program to reduce GHG emissions. A
cap-and-trade program provides a market-based policy tool for reducing emissions
by setting a cap or maximum emissions limit for certain industries. Sources covered
by the cap can choose to reduce their own emissions, or can choose to buy emission
credits that are generated from reduction made by other sources. Applying this type
of market-based approach to GHG reductions and trading would be similar to the
acid rain reduction program established by the 1990 Clean Air Act Amendments.
For more information about these GHG legislative proposal, see CRS Report
RL33846, Greenhouse Gas Reduction: Cap-and-Trade Bills in the 110th Congress,
and CRS Report RL34067, Climate Change Legislation in the 110th Congress, by
Brent D. Yacobucci and Jonathan L. Ramseur.
Source of Emissions Reductions. Historically, climate-related legislative
initiatives have not specifically focused on emissions reductions in the agriculture
sector. In part, this may reflect the general consensus, as reflected by the House
Energy and Commerce Committee, that GHG “emissions from the agriculture sector
generally do not lend themselves to regulation under a cap-and-trade program,” given
the “large number of sources with small individual emissions that would be
impractical to measure.”65
In general, the current legislative proposals do not include the agriculture sector
as a covered industry, which would require farmers and landowners to reduce
emissions associated with climate change. One exception is H.R. 6186 (Markey),
which would require performance standards for certain sources of methane and
nitrous oxide emissions, including animal feeding operations; H.R. 6186 would
specifically not include crop operations and forest management systems. However,
some interest groups continue to question whether certain types of agricultural
operations could eventually be brought in under some proposals. For example, some
bills would provide authority to EPA to determine covered entities by applying66
cost-effective criteria to reduction options; other bills such as S. 3036
(Leiberman/Warner) would cover biogenic emissions resulting from biological
processes, which some interpret as potentially including animal agriculture facilities.
Still others argue that U.S. agriculture will be affected by anticipated climate
65 Committee on Energy and Commerce, “Climate Change Legislation Design White paper:
Scope of a Cap-and-Trade Program,” prepared by committee staff, Oct. 2007, available at
66 Including H.R. 1590 (Waxman), S. 309 (Sanders), and S. 485 (Kerry).
legislation in terms of generally increasing energy and production input costs that
will negatively impact the farming sector.67
Source of Offsets and Allocations. Several of the cap-and-trade proposals
do incorporate the agriculture and forestry sectors either as a source of carbon
offsets68 or as a recipient of set-aside allowances.69 In the context of these legislative
proposals, a carbon offset is a measurable avoidance, reduction, or sequestration of
carbon dioxide (CO2) or other GHG emissions, expressed in carbon-equivalent70
terms. A set-aside allowance refers to a set percentage of available allowances
under the overall emissions cap that is allocated to non-regulated entities, in this case
domestic agriculture and forestry entities. Some bills also specify that the proceeds
from auctioned allowances be used to promote certain objectives, which could further
encourage farmland conservation and bio-energy technologies and practices, among
Many of the GHG bills — S. 280 (McCain/Lieberman), S. 317 (Feinstein), S.
1168 (Alexander/Lieberman), S. 1177 (Carper), S. 1766 (Bingaman/Specter), S. 3036
(Lieberman/Warner), and H.R. 620 (Olver) — would allow for the use of carbon
offsets, including agricultural activities and other land-based practices, under a
cap-and-trade framework. This builds on the concept, also expressed by the House
Energy and Commerce Committee, that emissions reductions and carbon
sequestration by the agriculture sector may provide an appropriate source of credits72
or offsets within a cap-and-trade program. Some bills — S. 309 (Sanders/Boxer),
S. 485 (Kerry), S. 1201 (Sanders), S. 1554 (Collins/Lieberman), and H.R. 1590
(Waxman) — would not allow for offsets, but would set aside a percentage of
allowances for various purposes, including biological sequestration. Participating
farmers and landowners who receive these allowances for sequestration and/or
emission reduction activities could sell them to facilities that could become covered
by a cap-and-trade program.
67 See, for example, a study conducted for the Fertilizer Institute at [http://www.tfi.org/
68 GHG bills that provide for agriculture or forestry offsets are S. 2191 (Lieberman/Warner),
S. 280 (McCain/Lieberman), S. 317 (Feinstein), S. 1168 (Alexander/Lieberman), S. 1177
(Carper), S. 1766 (Bingaman/Specter), and H.R. 620 (Olver). Markey (H.R. 6186) would
allow for agriculture offsets, except from animal operations under performance standards.
69 Primarily S. 2191 and also S. 1766 (Bingaman/Specter).
70 In the context of credit trading, an offset is a certificate representing the reduction of one
metric ton of carbon dioxide emissions, the principal greenhouse gas. Offsets generally fall
within the categories of biological sequestration, renewable energy, energy efficiency, and
reduction of non-CO2 emissions.
71 For more information on allowances and auction proceeds in current GHG bills, see
Allocations for Carbon Allowances and Auctions under S. 2191, by Brent D. Yacobucci,
CRS general distribution memorandum, February 22, 2008.
72 Committee on Energy and Commerce, “Climate Change Legislation Design White paper:
Scope of a Cap-and-Trade Program,” prepared by committee staff, Oct. 2007, available at
For example, a Senate bill reported by the Senate Committee on Environment
and Public Works (EPW), the Lieberman-Warner Climate Security Act of 2008 (S.
The cap-and-trade framework outlined in S. 3036 establishes a tradeable allowance
system that includes a combination of auctions and free allocation of tradeable
allowances. As part of this overall framework, S. 3036 includes three design
mechanisms that may provide financial incentives to encourage land-based
agricultural and forestry activities: carbon offsets, set-aside allowances, and auction
proceeds. S. 3036 provides for a range of agriculture and forestry offset projects,
including agricultural and rangeland sequestration and management practices, land
use change and forestry activities, manure management and disposal, and other
terrestrial offset practices identified by USDA. S. 3036 also would directly allocate
and allocate a set percentage of available auction proceeds to carry out a cellulosic
biomass ethanol technology deployment program. For more information on the
agriculture and forestry provisions in S. 3036, see CRS Report RS22834, Agriculture
and Forestry Provisions in Climate Change Legislation (S. 3036), by Renée Johnson.
The inclusion of these types of provisions could provide opportunities to some
farmers and landowners by allowing them to directly participate in and potentially
gain a significant part of this emerging carbon market. The offset and allowance
provisions could allow farmers and landowners to participate in the emerging market
by granting them the use of allowances and credits for sequestration and/or emission
reduction activities. These allowances and credits could be sold to regulated
facilities (e.g., power plants) covered by a cap-and-trade program to meet their
emission reduction obligations. Proceeds from the sale of these allowances, credits,
and auctions could be used to further promote and support activities in these sectors
that reduce, avoid, or sequester emissions.
The inclusion of provisions that allow for agriculture and forestry offset and
allowances as part of a cap-and-trade scheme is generally supported by a broad-based
industry coalition. This coalition consists of agricultural groups representing
commodity crops, livestock and dairy, the American Farm Bureau Federation, the
National Farmers Union, the American Farmland Trust, and other agriculture support
and utility companies.73 Former Senators and Majority Leaders Bob Dole and Tom
Daschle are also advocating on behalf of the Bipartisan Policy Center that farmers
be fully integrated into any cap-and-trade scheme.74
However, the inclusion of carbon offsets from the agriculture and forestry
sectors within a cap-and-trade program has remained controversial since the Kyoto
Protocol negotiations.75 During those negotiations, there was marked disagreement
73 National Association of Wheat Growers, “Ag, Utility Groups Write on Stabenow
Amendment,” June 13, 2008, at [http://www.wheatworld.org/html/news.cfm?ID=1423].
74 Senators Bob Dole and Tom Daschle, The Role of Agriculture in Reducing Greenhouse
Gas Emissions: Recommendations for a National Cap-and-Trade Program, April 2008, at
75 See, for example, E. Boyd, E. Corbera, B. Kjellén, M. Guitiérrez, and M. Estrada, “The
among countries and interest groups, arguing either for or against the inclusion of
offsets from the agriculture and forestry sectors.76
The EU’s GHG emission program, the Emission Trading System (ETS), which
was established in 2005, does not provide for agricultural or forestry projects and
activities. Among the reasons are (1) pragmatic concerns regarding measurement and
verification, given the sheer number of farmers and landowners, and (2) ideological
concerns about granting too much flexibility in how emission reductions are met,
which could undermine overall program goals. Among the areas of concern
regarding biological sequestration offsets are those highlighted in two previous
sections of this report, “Uncertainty Estimating Emissions” and “Uncertainty
Estimating Carbon Sinks.” In summary, primary areas of concern include:
!Permanence/Duration, given that land uses can change over time
(e.g., forest lands to urban development, other natural events such as
fires or pests);
!Measurement/Accounting, given that biological sequestration
measurement is difficult and estimates can vary, actual emission
reduction or sequestration depends on site-specific factors (e.g.,
location, climate, soil type, crop/vegetation, tillage practices, farm
!Effectiveness, the success of the mitigation practice will depend on
the type of practice, how well implemented and managed by the
farmer or landowner, and the length of time the practice is
!Additionality, given that some of the activities generating offsets
would have occurred anyway under a pre-existing program or
practice, and thus may not go beyond business as usual (BAU);
!Leakage, given that reductions in one place could result in
additional emissions elsewhere; and
!Double counting, given that some reductions may be counted by
another program (e.g., attributable to other environmental goals
under various farm conservation programs) or towards more than
one GHG reduction target.
A more detailed discussion of some of these issues is available in CRS Report
RL34436, The Role of Offsets in a Greenhouse Gas Emissions Cap-and-Trade
Program: Potential Benefits and Concerns, by Jonathan L. Ramseur. Many of these
concerns, as well as the potential market opportunities issues for farmers and
Politics of ‘Sinks’ and the CDM: A Process Tracing of the UNFCCC Negotiations
(pre-Kyoto to COP-9),” Feb. 2007, draft submitted for International Environmental
Agreements; also see two articles in Nature, no. 6812, Nov. 2000, “Deadlock in the Hague,
but Hope Remains for Spring Climate Deal,” and “Critical Politics of Carbon Sinks.”
76 Referred to as “land use, land use change, forestry,” or abbreviated as LULUCF.
landowners, were discussed at a subcommittee hearing of the Senate Agriculture
Committee in May 2008.77
Farm Bill Legislation
To help address some of the measurement and quanitification issues surrounding
agricultural and forestry carbon credits, both the House and Senate Agriculture
committees included a specific provision in their respective versions of the new
omnibus farm bill to address this issue. This and other related provisions were
included in the enacted 2008 farm bill (P.L. 110-246, the Food, Conservation, and
Energy Act of 2008). Specifically, the enacted bill contains a new conservation
provision that seeks to facilitate the participation of farmers and landowners in
environmental services markets, including carbon storage. The bill also expands
existing voluntary conservation and other farm bill programs, providing incentives
that could accelerate opportunities for agriculture and forestry to reduce emissions
associated with climate change, adopt energy efficiency measures, and produce
renewable energy feedstocks.
In particular, the new environmental services market provision seeks to
“establish technical guidelines that outline science-based methods to measure the
environmental services benefits from conservation and land management activities
in order to facilitate the participation of farmers, ranchers, and forest landowners in
emerging environmental services markets.” The intended purpose of these technical
guidelines is to develop (1) a procedure to measure environmental services benefits;
(2) a protocol to report environmental services benefits; and (3) a registry to collect,
record and maintain the benefits measured. The provision also requires that USDA
provide guidelines for establishing a verification process as part of the protocol for
reporting environmental services, but it allows USDA to consider the role of third
parties in conducting independent verification. In carrying out this directive, USDA
is directed to work in consultation with other federal and state government agencies,
non-governmental interests, and other interested persons as determined by USDA.
However, the enacted bill does not specifically address funding for this provision.
Nevertheless, the inclusion of this provision in the farm bill will expand the scope
of existing farm and forestry conservation programs in ways that will more broadly
encompass certain aspects of the climate change debate.
For more detailed background information, see CRS Report RL34042,
Environmental Services Markets: Farm Bill Proposals, by Renée Johnson.
Considerations for Congress
Following is a list of questions that may be raised as Congress considers the role
of the agriculture and forestry sectors as part of the broader climate change debate.
77 Subcommittee on Rural Revitalization, Conservation, Forestry and Credit hearing, May
21, 2008, “Creating Jobs with Climate Solutions: How agriculture and forestry can help
lower costs in a low-carbon economy,” at [http://agriculture.senate.gov/].
!Farm Bill Programs. Given the changes enacted in the 2008 farm
bill, are there opportunities to expand existing federal conservation
and land management programs to achieve greater emissions
reduction and carbon sequestration in the agriculture sector? How
might emissions reduction and carbon sequestration be integrated
with the many other goals of conservation programs, such as
improved soil quality and productivity, improved water and air
quality, and wildlife habitat? Which programs or practices are the
most beneficial and cost-effective? Are there ways to rank
applications from farmers under existing programs to grant a higher
weight to proposals to address climate change goals? Are there
existing state programs that effectively address climate change and
could be adopted at the federal level?
!Emissions reductions. Should carbon sequestration efforts be
balanced by incentives to obtain additional emissions reductions in
the agriculture sector through improved conservation and farm
management practices, which could have a more immediate, direct,
and lasting effect on overall GHG emissions? How might the
existing regulatory framework for controlling air pollutants affect the
climate change debate? What are the potential options for reducing
GHG emissions at U.S. farming operations? How might cost
concerns be addressed that limit broader adoption of manure
management systems and also feed management strategies at U.S.
!Carbon sequestration. What are the upper limits of carbon capture
and storage initiatives in the agriculture sector? For example, are
such carbon sinks temporary or long-lasting, and what limits exist on
their storage value? Do they rely appropriately on the willingness of
landowners to adopt or continue to implement a particular
conservation practice? Do they rely too heavily on the willingness
of landowners to convert existing farmland to open space or prevent
the conversion of existing farmland to non-farm uses? Are they cost-
effective when compared to sinks in other sectors? How might
concerns regarding uncertainty be addressed when measuring and
estimating the amount of carbon sequestered in agricultural soils?
!Carbon offset or credit markets. What is the federal role in
possibly expanding existing conservation programs in conjunction
with efforts to create new market opportunities for farmers by
developing a carbon credit trading system? How will USDA
implement the new 2008 farm bill provision directing the
Department to work with other agencies and organization to
establish guidelines and standards for measuring agricultural and
forestry environmental benefits, including carbon storage? What are
the potential measurement, monitoring, enforcement, and
administrative issues of implementing a carbon credit trading system
involving the agriculture and forestry sectors? How would stored
carbon be measured and verified; how much compensation would be
available and for how long; what are required management practices;
and which accounting methodologies should be used? Would such
a system operate under a voluntary or a mandatory framework?
!Bioenergy promotion. How might ongoing or anticipated initiatives
to promote U.S. bioenergy production, such as corn-based or
cellulosic ethanol, affect the options for land management or
conservation strategies that could increase carbon uptake on
agricultural lands and in agricultural soils? Might broader climate
change goals be affected by increased agricultural production in
response to corn-based ethanol? For example, might previously
retired land be brought back into corn production or might this result
in more intensive corn production, including fewer crop rotations
and planting area setbacks, which could raise emissions and reduce
the amount of carbon sequestered? Are there other competing
commercial crops that might be used as a feedstock for ethanol that
could also affect emissions and carbon uptake potential?
!Energy efficiency. What are the opportunities for improved on-farm
energy efficiency and conservation? How might these be integrated
into the broader framework on climate change mitigation in the
!Safeguarding U.S. agricultural production. Among the possible
effects of global climate change on agricultural production are
increased climate variability and increased incidence of global
environmental hazards, such as drought and/or flooding, pests,
weeds, and diseases, or location shifts in where agriculture is
produced. Climate change in some locations increases the yields of
some crops. Some U.S. production regions are likely to fare better
than others. Are additional initiatives needed in the U.S. agriculture
sector to prepare for the potentially effects of global climate change
that might impact U.S. agricultural production and food security?
Which regions and crops might be “winners” or “losers” and how
can transitions be eased?
Appendix: Primer on Agriculture’s Role in the
Climate Change Debate
Question D iscussion
What are theOfficial estimates of greenhouse gas (GHG) emissions for the U.S. agriculture sector are
types of GHGbased on emissions of methane (CH4) and nitrous oxide (N2O) associated with agricultural
emissionsproduction only. These estimates do not include carbon dioxide (CO2) emissions from on-
associated withfarm energy use and other emissions associated with forestry activities, food processing
U.S. agriculture? or distribution, or biofuel production.
See Agricultural GHG Emissions in this report for more information.
What are theAgricultural sources of CH4 emissions are mostly associated with the natural digestive
sources of GHGprocess of animals and with manure management on U.S. livestock operations. Sources
emissions fromof N2O emissions are mostly associated with soil management and fertilizer use on U.S.
Figure 1 shows agricultural emissions by type and production category.
Why are CO2CO2 emissions from on-farm energy use are aggregated with emissions for all
energy emissionstransportation and industrial sectors, and comprise a small share of this total. Even if
excluded? included in the estimates for the agriculture sector, this would not substantially raise
agriculture’s overall share of total GHG emissions.
What isIn 2005, GHG emissions from U.S. agricultural activities totaled nearly 540 MMTCO2-Eq
agriculture’s(million metric tons CO2-equivalent units, accounting for about 7% of annual national
share of annualGHG emissions (Table 1). Fossil fuel combustion is the leading source of national GHG
national GHGemissions (about 80%), with the energy sector generating about 85% of annual emissions
emissions? across all U.S. sectors.
How muchIn 2005, agricultural soils sequestered about 30 MMTCO2-Eq., or roughly 5% of annual
carbon isemissions generated from agricultural activities. Compared to total national GHG
sequestered inemissions, the agriculture sector offsets well under 1% of emissions annually. These
U.S. agriculturalestimates do not include uptake from forested lands or open areas that account for a
soils?majority (about 95%) of total U.S. sequestration. Figure 2 shows carbon sequestration in
agricultural soils. Also see Agricultural Carbon Sinks for more information.
Is there anyReasons for uncertainty associated with uptake estimates in U.S. soils include actual
uncertaintyuptake depends on site specific conditions (e.g., location, climate, soil type, crop type,
associated withtillage practices, crop rotations, farm management, etc.); accounting methodology; type
estimates ofof practice, how well it is implemented, and the length of time undertaken; availability of
carbon uptake forfederal/state cost-sharing or technical assistance; and other competing factors (including
the agriculturesupply response for commercial crops and bioenergy crops). Actual GHG emissions may
sector?also vary according to many site-specific conditions.
See Uncertainty Estimating Carbon Sinks for more information.
What is theThe potential for carbon uptake in U.S. agriculture sector is much greater than current
potential torates. USDA estimates net increases in carbon sequestration ranging from 40 to 590
reduce emissionsMMTCO2-Eq. per year (Table 2), or 2 to 20 times above current rates. This could offset
and/or increasetotal current national GHG emissions by as much as 8%. Other studies show an even
carbon uptake ingreater carbon uptake potential in the agriculture sector. Practices that may reduce
the agricultureemissions and/or sequester carbon on U.S. farmlands include land retirement, pastureland
sector?and crop conversion, restoration; improved soil management and conservation tillage; and
improved manure management and feeding strategies at livestock operations.
See sections Potential for Additional Uptake and Potential for Additional Reductions.
Question D iscussion
How costly areThe estimated value (or cost) of sequestered carbon will vary by practice. USDA’s forecast
the types ofof an additional sequestration potential of 40 to 590 MMTCO2-Eq. per year is associated
farming practiceswith an estimated per-unit value ranging from $3-$34/mt of permanently sequestered
that help addresscarbon dioxide. The low-end of this range reflects the sequestration potential associated
climate changewith cropland management practices; higher-end values are associated with afforestation
issues?and land retirement. See Table 2 for more information
See Potential Mitigation Costs for more information.
How canMost land management and agriculture conservation practices might both reduce GHG
emissions fromemissions and/or sequester carbon, including land retirement, conversion, and restoration;
production beconservation tillage; soil management and soil erosion controls; efficient fertilizer/nutrient
reduced? Howand chemical application; crop rotations; cover cropping; manure management; feed
can carbonmanagement; rotational grazing and improved forage; vegetative and riparian buffers;
uptake inwindbreaks for crops and livestock; bioenergy substitution and renewable energy use; and
agricultural soilsenergy efficiency and energy conservation on-farm.
be increased?See Table 3 and Mitigation Strategies in the Agriculture Sector for more information.
Are thereExisting federal and state farm conservation programs promote the types of land
existingmanagement and conservation practices that can reduce GHG emissions and/or sequester
programs and/orcarbon. Also, many existing voluntary programs in the current farm bill, as well as under
legislation thatexisting state-level programs provide cost-sharing and technical assistance to encourage
promote farmingfarmers to implement such practices. These are voluntary programs and are generally
practices thatdesigned to address site-specific improvements at an individual farming operation.
may help addressSee Federal Programs and other listed program information.
Source: Table prepared by the Congressional Research Service.