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Ag opinions divided on Oregon ‘cap-and-invest’ bill

Opinions are divided among agricultural producers and industry groups concerning Oregon’s proposed carbon “cap-and-invest” bill.


Capital Press

Published on February 9, 2018 10:04AM

Oregon farmers and agricultural groups are divided about the cost versus benefit of a proposed carbon “cap-and-invest” bill that is expected to dominate the 35-day legislative session.

Supporters argue that climate change is already causing more extreme weather patterns, putting crops and farmers at risk.

Opponents, on the other hand, say a carbon cap will raise fuel prices and cost Oregon jobs, while making little to no difference on global greenhouse gas emissions or climate change.

The Legislature held a hearing this week, and the House Committee on Energy and Environment may hold another work session Monday, Feb. 12, to discuss the contentious policy.

The issue may be moot for now, though, since lawmakers on both sides of the political aisle have suggested the short session is not enough time to pass such a complex bill.

Still, farmers and ranchers are key players in the debate that could have long-lasting consequences moving forward.

Rising costs

Under cap-and-invest, the state would place a limit on carbon emissions and then charge those companies for “allowances” to exceed the limit, which can be sold or traded on the open market.

The cap would gradually be reduced lowered over time, and the money raised by the program would be placed in funding pools for climate-friendly state initiatives, such as renewable energy development.

Oregon’s proposal would take effect in 2021 and require companies that emit more than 25,000 metric tons of carbon annually to purchase allowances. But agriculture groups such as the Oregon Farm Bureau, Oregon Cattlemen’s Association and Northwest Food Processors Association are concerned the bill would raise food and electricity prices at a time when growers are already facing razor-thin margins.

Jenny Dresler, director of state public policy for the Farm Bureau, said cap-and-invest would cost a mid-size producer in the Willamette Valley an extra $3,000 to $5,000 per year, and $11,000 to $16,000 for custom farming businesses.

The burden, Dresler said, could be staggering for families struggling to make ends meet.

“They are going to see a pretty significant hike in their fuel costs alone,” Dresler said in an interview with the Capital Press.

In written testimony submitted to the Legislature, Jerome Rosa, executive director of the Oregon Cattlemen’s Association, said the bill would drive up costs for cattle producers. Incentive programs offered under the bill would also “require ranchers to devote precious time and resources to a cumbersome application process,” he added.

As for energy-intense food processors, the worry is that cap-and-invest would push companies across state lines.

Craig Smith, director of government affairs for the Northwest Food Processors Association, said most companies already have manufacturing plants in nearby Washington and Idaho, and may leave Oregon altogether if the cost of doing business becomes too high.

“When you start to tinker with the economy this way, it just has some unintended consequences,” Smith said. “Those are real jobs.”

Even if Oregon managed to eliminate all emissions, Smith doubted it would make a dent on the world’s carbon output.

“If you look at Oregon’s carbon footprint, it’s almost non-existent,” he said.

Changing climate

According to reports, global carbon dioxide emissions were expected to reach 41 billion metric tons in 2017. Oregon emits roughly 63 million metric tons of carbon dioxide annually. That’s .001 percent of the world’s output.

Brad Reed, spokesman for the Renew Oregon coalition pushing for cap-and-invest, acknowledged that Oregon’s carbon footprint is comparatively small, but took issue with the argument.

“Just because Oregon can’t grow enough potatoes to feed the entire world, do we not grow potatoes here?” Reed said. “We do our part.”

Plus, Reed said Oregon would not be going it alone — the state would join carbon pricing markets in California and Quebec and Ontario, Canada, which combined make up the fourth-largest economy in the world.

“That has a lot of weight,” he said. “Looking at it purely economically, it is really to Oregon’s advantage to get moving on this.”

But farmers who support cap-and-invest say it is about more than dollars and cents.

The Oregon Climate and Agriculture Network, or OrCAN, is a volunteer-run organization that formed in late 2017 to advocate farming practices that sequester more carbon in soil, such as reduced tillage or cover cropping.

Working with Renew Oregon, OrCAN rallied support from 138 small farms, ranches and vineyards which signed on to a letter urging Gov. Kate Brown and lawmakers to pass cap-and-invest.

“Our rural communities are observing dramatic changes in the climate, which we must address or lose our livelihoods,” the letter reads. “When climate change exposes our crops to extreme and unpredictable temperatures, our yields and economic security are threatened.”

Potential benefits

Megan Kemple, a nonprofit director in Eugene, serves as director of OrCAN. She said extreme weather is leading to more unpredictable growing seasons and farm damage of its own.

For example, Kemple said major snowstorms battered the Eugene area four years ago, causing several $30,000 greenhouses to collapse. A similar event last winter caused nearly $100 million in damage to onion storage and packing facilities in Eastern Oregon.

“That kind of extreme weather is becoming more and more common,” Kemple said. “It’s a huge challenge for farms.”

A portion of revenue collected by cap-and-invest would go into a climate investment fund, which Kemple said would provide grants to help farmers increase carbon sequestration. Those projects would then generate offset credits, which could be sold back on the market.

“Agriculture can actually be part of the solution when farms implement climate-friendly practices,” Kemple said. “This bill provides funding for them to do that.”

Les Perkins, manager of the Farmers Irrigation District in Hood River, did not speak for or against the bill, but told the Capital Press that funding to invest in small-scale renewable energy projects may have the potential to benefit districts like his.

The FID, which includes 5,888 acres, includes two small hydroelectric projects that have generated $50 million for the district over 30 years. That money has paid for infrastructure to conserve water, such as piping in place of open irrigation ditches.

Water conservation is key, Perkins said, at a time when more winter precipitation is falling as rain instead of snow. Without snowpack on Mount Hood to replenish streams and reservoirs, he said the timing and availability of water during irrigation season is affected.

“You can see those shifts,” Perkins said. “It’s a scary thing to be looking at less snowpack available.”

Sharon Blick, who owns Living Earth Farm on 15 acres west of Eugene, said timing is everything for farmers.

Blick said she is already seeing weather cause bizarre issues on her farm — one year the rhubarb started making stalks in November, when it is usually dormant. Another year her apple tree was blooming as late as Labor Day, when they generally bloom in spring.

“If you can’t predict what the weather is going to do, it’s really hard to get your timing right,” Blick said.

Climate change is already getting worse, Blick said. She supports cap-and-invest to help agriculture in the long run.

“I’m worried about our food supply, really,” she said. “I see things getting worse and worse the longer we wait to do anything about climate change.”


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