Integrating biofuel production and mitigation strategies into agricultural landscapes

Background/Question/Methods

Agricultural land – a finite resource - is facing pressures because of increasing population and economic growth. Simultaneously, concerns about climate change, energy security and, more broadly, dependence on fossil fuels have spurred the production of biofuels. Agriculture and forestry have also emerged as potentially important cost-effective bridge technologies in global climate mitigation. This puts an additional set of demands on agriculture and forestry. Since these different objectives are being pursued via separate programs, often implemented in an uncoordinated manner by different institutions, it is crucial to understand potential policy interactions to avoid unintended consequences and build upon synergies. Currently, in the US, the collapse of the Chicago Climate Exchange and uncertainty surrounding mitigation policies and the next Farm Bill mean is not clear what role offsets will play towards mitigation. However, offset markets are already active and fast developing globally thanks to the European Union trading scheme and initiatives such as the United Nation’s program to reduce emission via the preservation and increase of forests (REDD+). Crucial issues that need to be addressed in offset mechanisms are the determination of a baseline land use and management practices that the offsets are measured against and the set of allowed land uses and practices. To understand how policies may interact, quantitative simulation models capable of simultaneously assessing policy effects are needed. We use an example of US Midwestern agricultural landscapes to illustrate the issue.

Results/Conclusions

We show that subsidies for corn ethanol are associated with more continuous corn plantings, which typically result in more aggressive tillage practices. Such policies make offsets for climate mitigation that pay for no till practices more expensive. To the extent that biofuels are a climate mitigation strategy themselves, we should determine whether mitigation is achieved more efficiently (that is, at lower costs) via biofuel production or via the use of no till offsets. We also need to account for possible interactions between biofuel polices, offsets polices and preexisting conservation programs. For example, land retired from crop production into the Conservation Reserve Program is eligible for participation in offset markets, while the land itself is chosen on the basis of environmental benefit criteria that include carbon sequestration, implying that carbon is one of the benefits the program aims to achieve (and pays for). This could constitute “double dipping”, in which farmers are paid twice for providing the same environmental benefit, which is an inefficient use of public resources.