CLIMATE:

Senate Ag members look to stake major claim in cap-and-trade bill

Powerful members of the Senate Agriculture Committee are angling to include even more farm and ethanol-friendly provisions to their chamber's energy and climate legislation than the House added to its bill last month.

Chairman Tom Harkin (D-Iowa) and other members of his panel say they want to ensure any effort at wide-ranging climate legislation in the Senate will include all of the provisions that House Agriculture Chairman Collin Peterson (D-Minn.) brokered for the House cap-and-trade bill, H.R. 2454. With the hard-fought Peterson deal as their starting point, the farm state lawmakers could have leverage to capture additional benefits for farmers and ranchers.

As Senate leadership aims to advance the bill this fall, agricultural interests could form a formidable coalition. Several key fence-sitters on the bill sit on the Agriculture Committee, and farm interests have wide appeal in the Senate. Each senator has some farm interests in his or her state -- unlike the House, which has more representatives from urban and suburban areas.

"You're going to see more interest in agriculture on the Senate side, I think," Sen. Saxby Chambliss (R-Ga.), the ranking member of the Agriculture Committee, said this week of the climate bill.

House leaders compromised with Peterson and included a raft of changes he suggested for the cap-and-trade bill in order to win his and other key votes for the bill. The changes were a major victory for farm groups, but a disappointment to many environmentalists who are concerned it could weaken efforts to cut down on emissions.

Harkin said yesterday that he would like to repeat all of Peterson's language in the Senate bill and potentially build on it further. He had his first meeting last night with Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.), leadership and other Senate committee leaders and the top White House energy adviser, Carol Browner.

The much-publicized deal that Peterson brokered on the House side put the Agriculture Department, rather than U.S. EPA, as overseer of programs that would offset emissions with conservation efforts on farms, ranches and forests. Peterson's language also allowed "early actors," farmers who have been doing such conservation practices for years, to participate in the program.

Peterson also included a raft of provisions friendly to corn-based ethanol, another important issue for farm states. His language would temporarily block EPA from calculating a fuel's total worldwide carbon footprint before determining whether it qualifies as a biofuel eligible for incentives. The language in the bill that passed the House bars EPA for five years from including emissions from indirect land-use changes abroad.

"If it's like the House bill, I'll be reasonably happy," Harkin told E&E. "We want no indirect land use, things like that in there -- there is no scientific basis for that."

But the provisions from Peterson were not welcome additions for many environmental groups. In testimony this week to the Environment and Public Works Committee, Dave Hawkins of the Natural Resources Defense Council said he hopes the Senate will weed out some of the language. "These amendments run the risk of creating a subprime market in both offsets and biofuels," said Hawkins. "They seriously damage the environmental integrity of the bill, and they will undermine public confidence in the markets for both products."

Harkin wants to build on the Peterson language with "a little bit of other stuff," including more expansive offsets for sequestration and the ability for farmers to "stack" benefits -- using land enrolled in farm bill conservation programs to also gain carbon offsets. He admitted that he has been more concerned with work on health care legislation but said his committee would hold a hearing on the issue July 22, and he would expect to work on more legislative language in the fall.

"I don't think it will bother Senator Boxer or anybody at all," Harkin said.

The Iowa Democrat, a major advocate for ethanol, also wants to expand opportunities for the corn-based version of the fuel. He said he would like to include language that would raise the amount of ethanol that can be blended into gasoline from 10 percent to 15 percent -- a change the ethanol industry has been lobbying for but auto manufacturers have been hesitant to embrace and environmental groups have balked at.

"EPA's got to get over their absolute rejection of ethanol. They've just got to get over it," Harkin said. "And we're going to force them to get over it."

The Peterson amendment also has the support of Sen. Amy Klobuchar (D-Minn.), who sits on both the Agriculture and EPW committees. "I'm very hopeful that those changes will be included," Klobuchar said yesterday. "I'm not concerned we're going to see any backtracking."

Fence-sitters remain on fence

Attempts to broaden opportunities for farmers and corn-based ethanol could lose some support for the bill from environmental groups, which have been critical of the fuel for the land, pesticides and water pollution involved in its use.

But at least some concessions for agriculture may be necessary to secure the bill's passage. The Senate Agriculture Committee includes some key members that Boxer will need to win over if she is to get the crucial 60 votes needed to pass the bill, including fence-sitters on the bill like Sens. Kent Conrad (D-N.D.), Blanche Lincoln (D-Ark.) and Debbie Stabenow (D-Mich.).

Lincoln said this week that she has "a lot of concerns" with how the bill would affect Arkansas -- noting that her commitment is to represent the people of her state, not necessarily to help the caucus get to 60 votes. "I have great concerns with what the House has done, but I haven't seen it on this side," Lincoln said.

Meanwhile, Conrad said he has started to meet with key members of the EPW Committee in an attempt to make sure agricultural concerns are addressed early on -- not late in the negotiation stages as they were in the House. The Budget Committee chairman is a key voice for agricultural interests -- he showed himself a tough negotiator on the farm bill and frequently got his way on provisions large and small. Conrad said this week he wants the Senate climate bill to include something "very much on the same lines" as Peterson's amendments in the House.

But even with those farm-friendly provisions, Conrad said he is still on the fence about the bill -- since he must also think about his state as the nation's fifth-largest oil producer and a major consumer of coal for electricity. He said more allocations or offsets might help encourage him to vote for the measure.

"In North Dakota we have more than agriculture concerns, we're a major energy state as well," Conrad said. "So we've got a lot of concerns ... they've certainly improved substantially from where it was last year by what they did in the House, but it has a ways to go before I can vote for it."

And Sen. Ben Nelson (D-Neb.) said that to win his support, the bill will have to ensure it does not raise utilities rates or include "anything that would adversely impact agriculture." He said he has discussed the bill with Sen. John Kerry (D-Mass.) and passed on some of his concerns to Boxer.

Ag groups weigh in

Farm groups, which were divided on the House climate bill, have not started heavy lobbying in the Senate. Influential groups like the American Farm Bureau Federation and the National Pork Producers Council did not support the House-passed measure.

But farmland conservation groups and the National Farmers Union, a left-leaning group active in organizing farmers to sequester carbon, eventually endorsed the bill. Those groups came out against the version of the bill that cleared the House Energy and Commerce Committee but rallied behind the cap-and-trade effort after Peterson included his changes.

The farmers union, considered very influential among Democrats, is planning to circulate letters on the climate bill in the Senate within the next week. NFU spokeswoman Liz Friedlander said they want to be sure any Senate bill puts USDA at the helm for offsets and allows for the inclusion of "early actors," but she said her group is not seeking anything beyond the House provisions "at this time."

The American Farm Bureau Federation, on the other hand, opposes the House bill but is not making direct requests to senators for things they could do to improve it. The group is concerned that higher costs for fertilizer and fuels would outweigh any benefits from the legislation, especially as U.S. farmers have to compete with producers in China and India.

Richard Krause, the farm bureau's director of congressional relations, said his group would be talking to members about their concerns about the bill, but said they do not have a list of particular changes that could be made to gain their support.

"Right now our opposition still remains and it probably will unless something changes our mind, and I'm not sure how that will be," said Krause. "It would take a lot to change our minds, I won't say it can't be done but at this point, I don't see it."

Senior reporter Darren Samuelsohn contributed.

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