Farmers could benefit from climate change policy

A Climate and Environmental Strategy for US Agriculture, released by the World Resources Institute (WRI) at the start of the Sixth Conference of the Parties of the United Nations Framework Convention on Climate Change (UNFCCC), states that a ‘cap and trade’ system for nitrous oxide emissions could actually increase farmers’ incomes.

“Our findings suggest a win-win solution,” said Paul Faeth and Suzie Greenhalgh, authors of the report. “If the Kyoto Protocol of the UNFCCC were combined with the right set of domestic agricultural policies, net farm cash returns could actually increase while protecting the climate and improving water quality.”

Though agricultural activities only produce a small fraction of US carbon dioxide emissions, say Faeth and Greenhalgh, activities such as the use of synthetic fertilisers result in the industry accounting for about three-quarters of the emissions of nitrous oxide, a greenhouse gas which is 310 times more efficient at trapping heat than carbon dioxide.

According to the report’s authors, a nitrogen trading programme under the Clean Water Act would allow industrial and municipal waste water dischargers to meet their legal environmental obligations by paying farmers to reduced their nitrogen loads to waterways (see related story). When nitrogen surpluses stemming from agricultural run-off of synthetic fertilisers are reduced, say Faeth and Greenhalgh, emissions of climate-damaging nitrous oxide are also cut.

The WRI report says that a nitrogen trading programme would produce twice the reduction in nutrient emissions than would a soil carbon trading programme, benefiting both climate and waterways (see related story). The option would also increase net farm cash returns of 2.1%, says the report.

Carbon emission trading would probably cause a 0.5% decrease in farm returns as farmers adjust to rising fuel, fertiliser and pesticide prices, according to the WRI. The extension of soil carbon trading, and the current Conservation Reserve Programme which pays farmers to take land out of production for conservation would also aid farm incomes.

“Almost every environmental and economic indicator we tested shows much greater improvement with a nitrogen trading programme than with any other approach we considered,” said Faeth. “It just makes sense that if we implement programmes that take advantage of the synergies between climate protection and water quality, we save money, protect our environment, and boost overall farm returns at the same time.”