Sands, Ronald D (Joint Global Change Research Institute, University of Maryland,

8400 Baltimore Avenue, Suite 201, College Park, MD 20740; Phone: 301-314-6765; Fax: 301-314-6719; Email: Ronald.Sands@pnl.gov)

Competitiveness of Agricultural Greenhouse Gas Offsets: Are They a Bridge to the Future?

Ronald D. Sands *, Bruce A. McCarl

Activities to exploit agricultural carbon sequestration, agricultural emissions reductions, and biofuel related offsets utilize largely currently known and readily implementable technologies. Many other greenhouse gas mitigation options require future technological development before implementation. However, biological soil carbon sequestration, while ready to go now, generally has a finite life, allowing use until other strategies are developed. This paper reports on an investigation of the competitiveness of biological carbon sequestration from dynamic and multiple strategy viewpoints. Key factors affecting the competitiveness of soil carbon as an alternative is considered including competition with agriculturally and forestry based biofuels, afforestation, energy sector related CO₂ capture and storage, and fuel switching. The analysis is done using a mixture of a dynamic forest and agricultural sector model (FASOM) and a computable general equilibrium model (SGM) of the U.S. economy. Both models simulate U.S. greenhouse gas emission reduction efforts at various carbon prices over time. The results show that, at lower carbon prices and in the near term, soil carbon and other agricultural/forestry options are important bridges to the future, initially providing a substantial portion of the attainable greenhouse gas emission offsets, but with a limited role in later years. At higher carbon prices, afforestation and biofuels are more dominant among terrestrial options to offset greenhouse gas emissions. But in the longer run, allowing for capital stock turnover, options to reduce greenhouse gas emissions from the energy system provide an increasing share of potential reductions in total U.S. greenhouse gas emissions. In addition, data are presented on the environmental benefits of pursuing agricultural strategies.