Greenhouse Gas Control: Implications for Agriculture

...Farmers would be especially hard hit by higher energy prices. A national program to reduce emissions to 7 percent below 1990 levels by 2010 would require higher energy prices equivalent to a tax on gasoline of approximately 50 cents per gallon. Such a tax would cause net profits for farmers to fall by between 15 and 44 percent, depending on the crop. (See the table on this page.) Total annual U.S. farm production expenses would rise more than $23 billion, causing net national farm income to fall by 51 percent...
...We conclude that proposals to control greenhouse gas emissions pose a very serious threat to agriculture in the U.S. due to the energy-intensive nature of the industry. Programs that seek to cap or reduce emissions lead to higher energy prices, which would reduce farmers’ net income and profits. Proposals to pay farmers and ranchers to sequester carbon in their soil are superficially more appealing, but they are likely to lead to higher energy costs, new regulatory burdens, and emission permit costs that exceed whatever revenues might be earned...