2008 Farm Bill Directs USDA to Develop Methods for Farmers' Participation in Carbon Markets, the Technical Term for a Cap and Trade Program

Federal Government Teaching Farmers to Participate in ‘Carbon Markets’ that Don’t Exist Yet

A carbon market is the technical term for what is commonly known as a cap and trade program, a program where businesses – including farms – are forced to trade carbon allowances or credits on the market, effectively putting a price on emitting carbon dioxide.

January 21, 2011

CNSNews.com – The U.S. Department of Agriculture (USDA) is teaching farmers how to participate in “carbon markets” despite the fact that such markets do not exist and Congress – in rejecting cap and trade legislation last year – has refused to create them.

Deputy Secretary of Agriculture Kathleen Merrigan made the admission at the WorldWatch Institute’s 2011 State of World Symposium Wednesday, saying that one of the ways USDA was dealing with climate change was to teach American farmers how to participate in “carbon markets,” the technical term for a cap and trade program.

“[USDA] will show farmers clearly and directly how they can benefit from participating in carbon markets,” Merrigan said. “It’s got to go from the drawing board to the boardroom.”

A carbon market is the technical term for what is commonly known as a cap and trade program, a program where businesses – including farms – are forced to trade carbon allowances or credits on the market, effectively putting a price on emitting carbon dioxide.

CNSNews.com asked Merrigan why USDA would be trying to show farmers how to benefit from a program that does not exist. Merrigan did not directly answer before being pulled away from the interview by a USDA spokesman.

CNSNews.com: You mentioned teaching farmers how to participate in carbon markets. Why do that? There is no, there isn’t a carbon market to participate in.

Merrigan: Well, again I’ll restate what I said, we need to get it from the drawing board to the boardroom, that people are – I think – ready to dive in. We’ve had a number of people at USDA at work at this as directed by the 2008 Farm Bill, and so I’m hopeful. Put some good minds together. I think there are some opportunities there, and I don’t want to leave them on the table.

CNSNews.com: Is [this] because efforts in the last Congress failed to try and get a cap and trade program or some other market going? Is there an administrative effort on that front?

Merrigan: Well, you know, there are a lot of people who comment on that last Congress, and I think there’s a misperception out there. It was a highly productive Congress. They passed a million pieces of major legislation [and] that they didn’t get to every single thing on people’s agenda, that’s not a surprise. But they were highly productive, and we look forward to working with this new Congress as it convenes, and we will continue to stress the issues we believe are important.

CNSNews.com: Sure, but there was a cap and trade bill, and for whatever reason it didn’t get passed. Maybe the question was unclear, but is there an administrative effort to try and create some sort of carbon market that wasn’t created legislatively?

Merrigan did not answer that final question. Instead, USDA spokesman Aaron Levallee interrupted the interview and said that the issue was “a much bigger story that we can cover in the minute before we have to jump on the elevator” before steering Deputy Secretary Merrigan into a pre-arranged interview with National Public Radio.

The 2008 Farm Bill directs USDA to develop methods for measuring the ecological benefits of farmer participation in carbon markets. Specifically, USDA is directed to develop measurement practices for “environmental services benefits.”

In practical terms, under a cap and trade system, farmers or other large landowners who adopt certain government-approved conservation programs can earn carbon credits, which they can then use to offset the carbon they emit during agricultural production or sell on the open market.

The 2008 Farm Bill directs USDA to develop ways to measure how much carbon would be saved if farmers implemented certain conservation practices, such as restoring or creating wetlands on their property, designating certain portions of their land as green conservation areas, or changing farming practices.