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Impact of US ETS on farm mixed, with croppers better off

- Tuesday, September 08, 2009

Texas A&M University has released the results of a detailed study of the projected impacts of the proposed US ETS on a sample of US farms. The results indicate that crop farmers will generally be better off (because they will be able to adopt no-till and sell the resulting carbon offsets) while livestock farmers will be worse off.

The research examined the projected impacts of the proposed US ETS on a sample of 98 US farms. Of the farms, 71 ended up worse off in 2016, despite their ability to sell carbon offsets and the fact that US agricultural emissions will not face a liability under the US scheme. Twenty seven farms were projected to be better off by 2016, with these mostly being grain and oilseed producers who are assumed to be able to sell offsets arising from the adoption of no-till croppiong systems. Interestingly, the research highlighted that the 'no-till' offsets provide a benefit for an initial period until soil carbon levels reach saturation, but provide no further benefit beyond that time, while farm input costs continue to rise.  
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