[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
 GLOBAL WARMING'S GROWING CONCERNS: IMPACTS ON AGRICULTURE AND FORESTRY 

=======================================================================

                                HEARING

                               before the
                          SELECT COMMITTEE ON
                          ENERGY INDEPENDENCE
                           AND GLOBAL WARMING
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 18, 2009

                               __________

                            Serial No. 111-6


             Printed for the use of the Select Committee on
                 Energy Independence and Global Warming

                        globalwarming.house.gov

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                SELECT COMMITTEE ON ENERGY INDEPENDENCE
                           AND GLOBAL WARMING

               EDWARD J. MARKEY, Massachusetts, Chairman
EARL BLUMENAUER, Oregon              F. JAMES SENSENBRENNER, Jr., 
JAY INSLEE, Washington                   Wisconsin, Ranking Member
JOHN B. LARSON, Connecticut          JOHN B. SHADEGG, Arizona
HILDA L. SOLIS, California           GREG WALDEN, Oregon
STEPHANIE HERSETH SANDLIN,           CANDICE S. MILLER, Michigan
  South Dakota                       JOHN SULLIVAN, Oklahoma
EMANUEL CLEAVER, Missouri            MARSHA BLACKBURN, Tennessee
JOHN J. HALL, New York
JERRY McNERNEY, California
                                 ------                                

                           Professional Staff

                   Gerard J. Waldron, Staff Director
                       Aliya Brodsky, Chief Clerk
                 Bart Forsyth, Minority Staff Director






















                            C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Edward J. Markey, a Representative in Congress from the 
  Commonwealth of Massachusetts, opening statement...............     1
    Prepared Statement...........................................     3
Hon. F. James Sensenbrenner, Jr., a Representative in Congress 
  from the State of Wisconsin, opening statement.................     5
Hon. Earl Blumenauer, a Representative in Congress from the State 
  of Oregon, opening statement...................................     6
Hon. Stephanie Herseth Sandlin, a Representative in Congress from 
  the State of South Dakota, opening statement...................     7
Hon. John Salazar, a Representative in Congress from the State of 
  Colorado, opening statement....................................     7
    Prepared Statement...........................................     8
Hon. Emanuel Cleaver II, a Representative in Congress from the 
  State of Missouri, opening statement...........................    12
    Prepared Statement...........................................    13

                               Witnesses

Jerry Hatfield, Supervisory Plant Physiologist, USDA.............    14
    Prepared Statement...........................................    17
Heather Cooley, Senior Researcher, Pacific Institute.............    31
    Prepared Statement...........................................    33
    Answers to submitted questions...............................    86
Tom Troxel, Director, Black Hills Forest Resource Association....    48
    Prepared Statement...........................................    50
    Answers to submitted questions...............................    93
Ford B. West, President, The Fertilizer Institute................    60
    Prepared Statement...........................................    62
    Answers to submitted questions...............................   104
Johannes Lehmann, Associate Professor of Soil Fertility 
  Management/Soil Biogeochemistry, Cornell University............    66
    Prepared Statement...........................................    68
    Answers to submitted questions...............................   107

                          Submitted Materials

Hon. Marsha Blackburn, a Representative in Congress from the 
  State of Tennessee, a fact sheet from AIM-AG entitled 
  ``Tennessee Agriculture Facts''................................    78


 GLOBAL WARMING'S GROWING CONCERNS: IMPACTS ON AGRICULTURE AND FORESTRY

                              ----------                              


                        THURSDAY, JUNE 18, 2009

                  House of Representatives,
            Select Committee on Energy Independence
                                        and Global Warming,
                                                    Washington, DC.
    The committee met, pursuant to call, at 9:33 a.m. in Room 
2175, Rayburn House Office Building, Hon. Edward J. Markey 
[chairman of the committee] presiding.
    Present: Representatives Markey, Blumenauer, Herseth 
Sandlin, Salazar, Cleaver, Speier, Inslee, Sensenbrenner, and 
Blackburn.
    Staff present: Ana Unruh-Cohen and Aliya Brodsky.
    The Chairman. This hearing is called to order.
    On Tuesday, the Obama administration released a new report, 
``Global Climate Change Impacts in the United States.'' It is 
the most comprehensive look at the current and potential 
impacts of global warming on the United States to date.
    The results are sobering. Temperatures are increasing. Sea 
level is rising. More extreme downpours are occurring. The 
report makes clear that global warming is happening and that 
the impacts are now being felt in every region of America and 
across society.
    Today, in the first of a series of hearings on that report, 
we are examining the impacts of global warming on agriculture 
and forestry. All Americans should be concerned with the 
impacts on these critical sectors. We all must eat. We all use 
products from forests every day.
    The findings of the report that rising temperatures, 
precipitation changes, and increasing weeds, disease and pests 
will impact the productivity of farms and forests should make 
all of us apprehensive. Land managers rely on the cumulated 
knowledge about their land, weather, and crops. But climate 
change is rewriting the Farmers' Almanac. The past is no longer 
prologue, and farmers must make decisions in the face of 
growing uncertainty. The serious consequences for agriculture 
and forestry provide yet another reason to take action now to 
curb global warming pollution.
    The report indicates that the growing season now starts 2 
weeks earlier, impacting farming and crops in rural America. 
Heavy downpours in the last 50 years increased 67 percent in 
the Northeast and 31 percent in the Midwest. Unsurprisingly, 
this time has been marked by record flooding in those regions. 
Yet, in the rapidly growing Southwest, they face a different 
climate challenge as water supplies are becoming increasingly 
scarce.
    Indeed, farmers and foresters are already suffering the 
consequences of climate change. But unlike other impacted 
sectors, they can also contribute to the solutions. According 
to the Environmental Protection Agency, U.S. forests and soils 
sequestered over 1 billion metric tons of carbon dioxide in 
2007, almost 15 percent of the Nation's greenhouse gas 
emissions. Land management practices designed to increase this 
carbon sink can pull even more carbon dioxide out of the 
atmosphere.
    Biomass can be used to generate renewable electricity, 
reducing global warming pollution from the burning of fossil 
fuels. Biomass can also produce renewable liquid fuels, 
allowing American consumers desperate for energy independence 
the ability to power their cars with cellulosic fuels from 
Middle America rather than oil from the Middle East.
    Wind turbines are sprouting on farms and ranches, 
generating clean electricity, while continuing the land's 
traditional use for food production.
    These practices are already growing clean-energy jobs and 
generating new revenue in our rural communities. With the right 
energy and climate policies, American farmers and foresters 
will play a crucial role in curbing the dangerous build-up of 
global warming pollution while creating new sources of income; 
money can grow on trees after all.
    The witnesses before us will help the select committee 
understand the challenges and opportunities global warming 
presents to U.S. agriculture and forestry. I look forward to 
their testimony.
    Let me now turn and recognize the ranking member of our 
committee, the gentleman from Wisconsin, Mr. Sensenbrenner.
    [The prepared statement of Mr. Markey follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Sensenbrenner. Thank you very much, Mr. Chairman. 
Today's hearing gives the select committee the opportunity to 
explore the impacts the proposed climate legislation will have 
on the agriculture industry and the effect that it will have on 
consumers.
    The House Democratic leadership has spent the last 2 months 
rushing to pass a carbon emissions reduction scheme that I call 
cap-and-tax. I call it cap-and-tax because the legislation is a 
hidden energy tax that will increase the price of nearly every 
staple in American life, including electricity, goods and 
services, and gasoline. Today's hearing will allow us to 
explore how this flawed policy will hurt American farmers.
    Cap-and-tax will reduce the security of America's food 
supply. If the government mandates a cap on fossil fuel 
emissions, many utilities will switch from coal to natural gas 
to generate electricity because natural gas produces fewer 
CO2 emissions. As demand for natural gas rises, the 
price will rise as well. But natural gas isn't used solely for 
electricity. As Ford West, president of The Fertilizer 
Institute says in his written testimony, there is no substitute 
for natural gas in nitrogen production.
    The U.S. domestic nitrogen fertilizer industry supplied 
about 85 percent of America's nitrogen in the 1990s, but the 
high cost of natural gas has moved much of this production and 
its jobs overseas. Today, just 55 percent of this vital farming 
resource is made in the United States. Much of the imported 
nitrogen is made in places that offer cheap natural gas like 
the Middle East, China, Russia, and Venezuela. These countries 
have no restrictive climate policies like cap-and-tax, and 
their energy efficiency is generally lower than that in the 
United States.
    Mr. West cites a study by the Doane Advisory Services that 
shows that a cap-and-tax scheme would add $6 billion to $12 
billion in additional costs for farmers by 2020.
    A recent study by the Heritage Foundation on the Democrat's 
cap-and-tax proposal also shows the devastating effects this 
scheme will have on agriculture. Farmers will be forced to pay 
more, and those costs will be reflected in the price of nearly 
every agricultural product. The Heritage study shows that 
increases in costs are expected to reduce farmers' incomes by 
$8 billion in 2012, and by more than $50 billion in 2035. The 
average net income loss between 2010 and 2035 is projected to 
be $23 billion.
    With numbers like these, it isn't surprising that 37 food 
and agriculture groups have opposed the cap-and-tax 
legislation. In addition to expanding taxes, cap-and-tax will 
expand the government, especially the Environmental Protection 
Agency.
    Because enforcement of a true carbon cap would debilitate 
the U.S. economy, the legislative proposal currently before the 
House of Representatives allows covered entities to make 
substantial portions of their reduction outside the cap go 
through what are called offsets. The bill allows 2 billion tons 
of offsets per year, 1 billion of which must come from domestic 
sources. The value of these billion offsets will easily reach 
into the tens of billions. Because the cap is so broad, 
agriculture and forestry are the only areas where offsets can 
be applied. The result will be tens of billions of tax dollars 
flowing into the farm industry.
    As financial and auto industries have learned, Federal 
money does not come without strings. Under the current bill, 
the EPA will be in charge of pulling these strings, and the EPA 
has no useful experience regulating agriculture.
    We have already got a whiff of what would happen if the EPA 
tries to regulate greenhouse gases. The American Farm Bureau 
Federation has said that if the EPA were to apply the Clean Air 
Act to greenhouse gases, nearly every dairy, cattle, and swine 
farm would fall under the regulations, resulting in literally a 
cow flatulence tax. The EPA has sworn this isn't their plan, 
but to exclude these farms from the regulations the EPA would 
have to take steps to exempt them, steps that could be 
challenged in court. This is the kind of absurd regulation that 
is exactly the type of policy we could see if the EPA becomes 
too involved in regulating greenhouse gases and agriculture 
production.
    Republicans believe that any climate change legislation 
must meet four simple principles: It must protect jobs and the 
economy; produce tangible improvements to the environment; 
advance technological progress; and feature international 
participation, including that of China and India. If we keep 
these principles in mind, we can address climate without 
threatening American farmers or our economic health.
    And I thank the Chair.
    The Chairman. I thank the gentleman very much.
    The Chair recognizes the gentleman from Oregon, Mr. 
Blumenauer.
    Mr. Blumenauer. Thank you, Mr. Chairman.
    And I do appreciate your having the hearing at this time. I 
am a little frustrated, because I have two other hearings that 
are going on. I did want to be here at least for the beginning 
and wanted to share some of my support for what you are doing, 
because there is nobody that has a greater stake in our getting 
our policies right with greenhouse gases more than agriculture. 
They have much at risk. We are seeing it in the Northwest with 
declining snow pack, with changing temperature patterns. If we 
don't get this right, agriculture and forestry, in the area 
that I represent, will be seriously at risk.
    Second, we have legislation that has been advanced from our 
friends on the Energy and Commerce Committee, which our 
distinguished Chair has helped craft, that can make a big 
difference for farmers, opportunities for farms and forests to 
reduce global warming pollution, for them to make money. As my 
good friend, the ranking member, pointed out, there are 
potentially billions of dollars available for American 
agriculture. This is an important opportunity. They also can 
earn more money, and we are seeing this in my State, leasing 
their land for wind turbines.
    A national renewable portfolio standard is going to develop 
that market even more, and thoughtful members of the 
agricultural community that I have been discussing are excited 
about it. Done right, there is an opportunity for cleaner fuels 
to come from forestry and agriculture, not questionable things 
where it is not clear that it actually creates more energy and 
has dire economic and environmental consequences. But we can 
get this right. We can provide a safety net to protect rural 
families from higher energy prices.
    And I commend you, Mr. Chairman, for the work that you have 
done in your other committee hat to do that.
    This is serious business. The notion that somehow there 
will not be regulation of agriculture, not just for its 
greenhouse gas emissions but for other things that are 
consequences of massive family--massive factory farms that put 
at risk American family agriculture is a pipe dream. We are 
seeing demands for more thoughtful regulation to protect 
people, and we are seeing millions of people in urban areas 
having to spend massive amounts of money to deal with the 
consequences of not having appropriate environmental 
regulation. It is coming.
    This is part of a framework that can help them make money. 
Everybody is going to be better off. I appreciate what you are 
doing with this hearing, and look forward to working with you 
and other distinguished members of this panel who have the 
expertise to make sure that we get this right.
    Thank you.
    The Chairman. I thank the gentleman.
    The Chair recognizes the gentlelady from South Dakota, Ms. 
Herseth Sandlin.
    Ms. Herseth Sandlin. Thank you, Mr. Chairman.
    I thank you and the ranking member for holding this 
important hearing today on the impact of climate change on 
agriculture and forestry.
    As the at-large Member for the State of South Dakota, a 
predominantly rural State, this issue is particularly important 
to my constituents. Moreover, the opportunities in the 
agriculture and forestry sectors to participate in mitigating 
climate change is equally an important topic.
    It is estimated that agriculture and forest lands currently 
sequester approximately 12 percent of our Nation's carbon 
emissions. With proper proactive management techniques, it has 
been estimated that the ag and forest sectors can sequester up 
to 25 percent of emissions. As such, the ag and forestry 
industries are essential partners in our efforts to mitigate 
climate change.
    Forests can both emit and sequester carbon, and through 
proper forest management, which includes thinning overstocked 
stands, working to ensure diversity of types of ages of trees, 
and other steps, we can increase carbon sequestration.
    At the appropriate time, I will look forward to introducing 
one of my constituents on the panel today, but again, I thank 
the chairman for holding the hearing and yield back.
    The Chairman. The gentlelady's time has expired.
    The Chair recognizes the gentleman from Colorado, Mr. 
Salazar.
    Mr. Salazar. Thank you, Mr. Chairman.
    I am very interested in this hearing today mainly because I 
am a farmer, and my wife and I still farm 3,000 acres back in 
Colorado. So I look forward to hearing your testimony, and I 
want to thank the chairman for calling this important hearing.
    While I have my concerns about the cap-and-trade bill that 
is coming up, I hope that we get it right. So thank you very 
much.
    [The prepared statement of Mr. Salazar follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you.
    The Chair recognizes the gentleman from Missouri, Mr. 
Cleaver.
    Mr. Cleaver. Thank you, Mr. Chairman.
    Missouri is a part of the U.S. breadbasket, and we produce 
in our State, at least generally, depending of course on 
weather conditions, about 382 million bushels of corn a year. 
And I am very proud to represent a district in a State that is 
a leader in promoting alternative energy sources.
    In 2008, my State, Mr. Chairman, was the third State to 
begin implementing a renewable fuels standard, requiring the 
sale of 10 percent ethanol blends when ethanol is cheaper than 
fossil fuels.
    And it is perhaps a little less known that Missouri places 
outdoor recreation up high in terms of its annual production of 
revenue. And I think at a time like this, when recreation 
sometimes bumps heads with agricultural desires and goals, we 
have got to be very, very careful. And my concern is that 
global warming is real. It is no longer a political issue. It 
is an issue revolving around the survival of this planet as we 
know it. And the more we can produce renewables for fuel, the 
better off we will be.
    As I have said before, we, this world in which we live, 
went through a time when there were salt wars. People actually 
fought wars over salt. And then as we progressed and made salt 
less valuable and alternatives more viable, we stopped having 
wars over salt. And refrigeration was a big part of it.
    And I think the same thing can happen with renewables, 
alternative fuels, that we can reduce the need to have wars 
over oil. Not that we have ever had one. But I thought I might 
just mention that. And so I look forward to listening to our 
experts and have some questions that I would like to raise that 
would hopefully help me.
    Thank you, Mr. Chairman. I yield back the balance of my 
time.
    [The prepared statement of Mr. Cleaver follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. I thank the gentleman very much.
    And now we are going to turn to our very distinguished 
panel. Each witness will be recognized for 5 minutes. At 5 
minutes, I am going to begin to tap. You will have 15 seconds 
to conclude your statement after that 5-minute period when I 
tap, just so I can give you that notice in advance.

      STATEMENTS OF JERRY L. HATFIELD, SUPERVISORY PLANT 
PHYSIOLOGIST, USDA AGRICULTURAL RESEARCH SERVICE, NATIONAL SOIL 
TILTH LABORATORY; HEATHER S. COOLEY, SENIOR RESEARCHER, PACIFIC 
   INSTITUTE; THOMAS A. TROXEL, DIRECTOR, BLACK HILLS FOREST 
 RESOURCE ASSOCIATION; FORD B. WEST, PRESIDENT, THE FERTILIZER 
 INSTITUTE; AND JOHANNES LEHMANN, ASSOCIATE PROFESSOR OF SOIL 
 FERTILITY MANAGEMENT/SOIL BIOGEOCHEMISTRY, CORNELL UNIVERSITY.

    The Chairman. Our first witness is Dr. Jerry Hatfield, 
supervisory plant physiologist at the U.S. Department of 
Agriculture and the lead author on the agriculture chapter in 
``The Global Climate Change Impacts on the United States'' 
Report. Dr. Hatfield has had a distinguished scientific career, 
authoring over 325 publications and serving as laboratory 
director of the National Soil Tilth Laboratory. He has also 
served as the president of the American Society of Agronomy.
    So we thank you, sir. Whenever you are ready, please begin.

                 STATEMENT OF JERRY L. HATFIELD

    Mr. Hatfield. It is a pleasure to be able to present this 
information on climate impacts on agriculture to this 
committee.
    Agriculture is extremely sensitive to climate and weather, 
and resilience of our production systems to changes in climate 
occurs by understanding these impacts and their effects. It is 
also important to realize that U.S. agriculture is diverse and 
that simple, general statements about the impacts of climate 
are not possible.
    Climate change is evidenced by rising temperatures, 
increasing precipitation and intensity of storms, rising carbon 
dioxide and ozone levels that will impact agriculture. These 
changes are not consistent across the United States and may 
affect some agricultural areas more than others.
    The scenarios of climate change in the U.S. have 
implications for agriculture, which must be understood to 
protect the capability of food, feed, fiber, and fuel 
production and quality.
    One of the easier ways for us to understand the 
implications of climate on agriculture is to consider the 
impacts of climate on animals. The increase of temperature and 
the potential for more heat waves and extreme heat events will 
affect animal production. Animals respond to a combination of 
temperature and humidity in a similar fashion than do humans. 
When it is hot and humid, we decrease our activity, reduce our 
food intake, and generally are less energetic than at other 
times. High temperature and humidity reduce the feed intake of 
animals, which in turn reduces the rate of meat, milk, or egg 
production.
    At the opposite end of the range, cold temperature extremes 
can reduce increase feed intake, but the extra energy is 
consumed to keep the animals warm, which results in reduced 
growth or milk production.
    Extremes in hot or cold have negative impacts on animals, 
and heat waves can have serious consequences on animals and can 
create conditions in which there is increased death of animals 
in feedlots or barns.
    High temperature extremes will affect plants as well as 
animals, and of particular concern is the probability of heat 
waves or high temperature events at the pollination stage. 
Exposure of pollen to high temperatures can destroy the pollen 
and reduce the production of seed or fruit. Occurrences of heat 
waves at pollen time can have significant and negative impacts 
on plant production.
    Plants differ in their reaction to temperature. Cool season 
plants which are best suited to lower temperatures include many 
of the vegetables, like peas or spinach. Warm season plants, 
like watermelon, cotton, or cucumber, thrive when the 
temperatures are warm. As temperature warms, this causes the 
plants to progress to their stage of development at a rate 
which does not allow for maximum expansion of leaves, stems, or 
fruits.
    One example of potential impacts of warming temperatures on 
crop yield has been found for soybean. As temperatures 
increase, soybean yields in the southern U.S. are predicted to 
decrease by 3.5 percent, while in the Midwest they are 
projected to increase by 2.5 percent. Rising temperatures will 
exceed the optimum range for soybeans in the South while 
bringing soybean into the optimum range in the Midwest.
    Likewise, for many vegetables, warming temperatures will 
cause a reduction in production even more quickly because these 
are cool season crops. While many of the vegetables are grown 
during the winter in temperate climates, the length of this 
time in which this period is optimal will decrease. Increasing 
winter temperatures does increase the length of the growing 
season, and there are potential negative impacts on fruit 
trees, which require a certain amount of cooling or chilling in 
order to set fruit.
    Climate models and observations indicate that nighttime 
temperatures are rising faster than daytime temperatures. This 
shift in temperature patterns during the day has significant 
impacts on plants, particularly during the grain or fruit 
development periods. Warm temperatures at night increase the 
respiration rate, which reduces the amount of sugars and 
starches which can be stored in grain or fruit. This causes the 
fruit or grain size to be smaller and reduces the length of the 
grain-filling period.
    Quality of agriculture produce is not often thought of when 
we discuss climate change. However, there are many impacts of 
climate and weather on product quality. Variations in wine 
quality among years are related to subtle changes in 
weathersensitive periods in the growing season. And 
there are direct and indirect effects of climate on 
agriculture.
    Agriculture has and can adapt to a changing climate. The 
areas in which we grow certain plants demonstrates how we adapt 
plant production systems to the climate. This adaptation has 
been occurring in agriculture for centuries as farmers have 
selected the best crops for their regions, changed their 
cultural practices to cope with the risks from environmental 
stresses, and modified their practices to reduce the impacts of 
biological stresses caused by weeds, insects, or diseases. 
Research has been able to help speed this process by providing 
information to guide the decisions.
    Thank you very much, Mr. Chairman.
    [The statement of Mr. Hatfield follows:] 

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you, Dr. Hatfield, very much.
    Our next witness is Ms. Heather Cooley, senior researcher 
at the Pacific Institute. Ms. Cooley works with the Pacific 
Institute's water program, researching climate change, water 
privatization, and California water issues. She has also 
studied climate and land-use change at the Lawrence Berkeley 
Laboratory in California.
    We welcome you.

                 STATEMENT OF HEATHER S. COOLEY

    Ms. Cooley. Thank you.
    Mr. Chairman, and members of the committee, thank you for 
inviting me here today to offer testimony regarding the effects 
of climate change on agriculture. As directed, I will limit my 
discussion here to those impacts related to water resources.
    Impacts on water resources will be especially problematic 
for agriculture. Numerous national and regional assessments, 
including the study released earlier this week, demonstrate 
that climate change is already affecting U.S. freshwater 
resources, and that these impacts will intensify in the future.
    The U.S. Geological Survey regularly reports that 
agriculture uses 70 percent of the Nation's freshwater 
resources; thus, impacts on water resources will have major 
consequences for agriculture.
    Rain-fed agriculture is especially vulnerable to changing 
precipitation patterns. In response to these changes, farmers 
may shift to supplemental irrigation, which may increase 
tensions over limited water resources. We are already seeing 
this in some areas. For example, in Georgia's Flint River 
Basin, farmers are rapidly shifting from rain-fed to irrigated 
agriculture, and this shift is one of the factors fueling the 
ongoing tensions between Georgia, Alabama, and Florida.
    Surface water supplies will be increasingly out of phase 
with agricultural water demand. Surface runoff is expected to 
decline during summer months at precisely the time when 
agricultural water demand peaks. Floods and droughts will 
become more common and more severe, and these extreme events 
will have a greater effect on crop production than changes in 
average conditions. Losses from droughts already total $6 
billion to $8 billion annually, much of which is due to impacts 
on agriculture, and these losses could rise in the future.
    Many of the impacts of climate change are now unavoidable. 
In fact, they are already occurring. The good news is that 
adaptation can substantially reduce the risk of climate change 
for the agricultural sector. But we cannot be complacent. The 
time to act is now. In the time available, I will offer a set 
of recommendations to reduce agriculture's vulnerability to 
changes in water resources.
    First, we must improve the management of surface resources. 
Specifically, the Bureau of Reclamation and Army Corps of 
Engineers should adopt new rules for the operation of water 
infrastructure in light of climate change. And based on these 
experiences and the methodologies they develop, the Bureau and 
Corps should provide guidance and oversight to local and state 
agencies to do similar analyses.
    We must also improve groundwater management. Our dependence 
on groundwater may increase in the future in response to more 
frequent and severe droughts. Throughout much of the United 
States, however, groundwater basins are mismanaged and 
overdrafted. In particular, the Federal Government should 
require all States to design and implement comprehensive 
groundwater monitoring and management programs.
    We must also capture water conservation and efficiency 
potential. Reducing agricultural water use reduces 
vulnerability to drought. However, many conservation practices 
require substantial investment. To help defray these initial 
costs, the government should expand funding for water 
conservation efficiency within the Federal Farm Bill. In 
addition, we should provide tax exemptions or rebates for 
efficient irrigation equipment and infrastructure.
    We must also eliminate Federal policies that inadvertently 
increase vulnerability to climate change. For example, the Farm 
Bill provides substantial direct payments for water-intensive 
crops that may not be appropriate under future climate 
conditions and may ultimately increase vulnerability to climate 
change.
    In its place, we should support new policies that promote 
climate change adaptation. Specifically, the Environmental 
Quality Incentives Program provides cost shares for practices 
that promote agricultural production and environmental quality. 
EQIP, however, accounts for less than 1 percent of the overall 
budget, and Congress has threatened to reduce funding further. 
The Federal Government should expand funding for Farm Bill 
conservation programs, especially EQIP.
    We must also continue research and development. Although 
climate change is a global problem, its impacts are local. 
Accordingly, detailed assessments of climate change risks 
require thorough analysis at the regional level. Without 
significant investment to generate estimates of regional 
impacts, climate change will remain a vague and unwieldy 
threat.
    The information must then be communicated to the 
agricultural community. Farmers and local communities will 
ultimately be responsible for implementing adaptation 
strategies, and the information that is available has not been 
adequately conveyed to farmers. Additional outreach is best 
accomplished by building on existing relationships. The U.S. 
Department of Agriculture in consultation with NRCS and 
extension agents should develop training and provide guidance 
about climate change impacts and adaptation strategies for the 
agricultural sector.
    We know that climate change is already occurring and that 
our farms are on the front lines. The challenge is to quickly 
equip the most vulnerable sectors and communities with tools to 
plan for and adapt to unavoidable impacts. Thank you.
    [The statement of Ms. Cooley follows:] 

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Ms. Herseth Sandlin [presiding]. Thank you, Ms. Cooley.
    It is now a great pleasure of mine to be able to introduce 
the next witness to members of the select committee. He is a 
fellow South Dakotan and a friend, Mr. Tom Troxel.
    Tom is the director of the Black Hills Forest Resource 
Association. Mr. Troxel brings a deep understanding of forestry 
and the forest industry, gleaned from over three decades of 
experience as a forester, working with the forest product 
companies in South Dakota and Wyoming for about 10 years, or 
longer than that, but 10 years in the U.S. Forest Service 
before then.
    He has been an invaluable resource to my office on issues 
related directly to the Black Hills National Forest and forest 
practices and policies more generally. His expertise is well 
known at home, but also recognized and respected nationally.
    On a personal level, I would like to publicly thank Tom for 
sharing his advice and counsel with me for many years now, and 
I strongly commend his testimony to my colleagues today.
    Mr. Troxel, you are now recognized for 5 minutes.

                 STATEMENT OF THOMAS A. TROXEL

    Mr. Troxel. Thank you very much, Representative Herseth 
Sandlin and members of this committee, for this opportunity to 
discuss climate change and forests.
    Many climate experts are predicting a warmer, drier climate 
in the coniferous forests of the Western United States. If 
correct, based on the last decade of drought conditions over 
much of the West, our forests will be increasingly susceptible 
to insect epidemics and forest fires, both of which have 
significant effects on air quality, water quality, stream 
flows, wildlife habitat, infrastructure, recreation, and rural 
communities.
    Sustainable management of forests can, to a substantial 
degree, mitigate global climate change, and there appears to be 
substantial overlap between climate change goals and proper 
forest management. Forests are unique in that no other means of 
sequestering or offsetting carbon has the added benefits of 
providing clean air, clean water, biodiversity, wildlife 
habitat, aesthetics, and wood products.
    Federal policies that invite and encourage sustainable use 
of our Nation's forests can help produce low carbon energy and 
sequester carbon through management strategies for 
sequestration, reducing fires and insect epidemics, 
substitution of biomass for fossil fuels, and utilization of 
wood products. Forests can either be a sink or a carbon source. 
A carefully managed forest can both prevent and reduce 
greenhouse gas emissions.
    Emphasis must be placed on maintaining forest health by 
thinning overstocked stands to reduce the risk of insect 
epidemics and wildfires. When catastrophic events do occur, 
dead trees should be salvaged, the area regenerated to restore 
forest cover and allow young trees to start absorbing carbon 
dioxide through photosynthesis.
    Emissions of greenhouse gases can be reduced through the 
substitution of biomass for fossil fuels to produce heat, 
electricity, and transportation fuels. The Congressional 
definition of renewable biomass in the RES is critical for 
cogeneration plants to be financially feasible. Forest biomass 
from Federal lands must be eligible, and all sustainably 
managed forests, public or private, should be equally eligible 
to supply biomass.
    I would like to show several slides, if we can have the 
slides, please. I am going to go through these quickly in the 
interest of time.
    This is the result of a mountain pine beetle epidemic in 
the Black Hills. These dead trees are a carbon source and a 
fire risk.
    This is a mountain pine beetle epidemic in Colorado. These 
dead trees are also a carbon source and fire risk. All the 
stands in this entire landscape are lodge pole pine. They are 
the same age, and they are overstocked. This was a mountain 
pine beetle epidemic waiting to happen, and increased 
temperatures pulled the trigger.
    This is the smoke column from the Jasper fire in the Black 
Hills. Fires are a huge source of greenhouse gases and 
particulates.
    This is the Jasper fire area. It is now a carbon source as 
the trees decay. There is a risk of reburn. And the burned area 
needs reforestation to restart the sequestration cycle.
    This is an unthinned stand of Ponderosa pine in the Black 
Hills. A stand like this is very susceptible to fires and 
forest insects.
    This is a thin stand of Ponderosa pine in the Black Hills. 
This is a healthy stand with low susceptibility to fires and 
insects. This is a carbon sequestration factory. There is 
strong public support for thinning like this in the Black 
Hills, because residents understand the link between 
overstocked forests and fires and mountain pine beetles.
    This is a slash pile. The Forest Service burns thousands of 
these each year. These are a source of greenhouse gases and 
particulates. These should but do not meet the RES definition 
of renewable biomass.
    My last slide is a picture of the Case Number 1 area. This 
is the site in the Black Hills National Forest where the first 
timber sale from the entire national forest system was sold in 
1899. This area has been thinned and harvested several times 
since 1899. Since then, approximately 6 billion board feet have 
been harvested from the Black Hills National Forest, and at the 
same time, the standing volume has increased from about 1.5 
billion board feet to almost 6 billion board feet. Sustainable 
forest management really does work.
    Including forestry in the climate change equation offers an 
opportunity to have our cake and eat it, too. We can make our 
forests healthier, reduce the risk of wildfires and insects, 
better utilize slash in small trees, create new jobs in rural 
communities, and produce renewable energy from American 
resources.
    In conclusion, thank you very much for allowing me to 
testify today. I appreciate your time and attention, and I 
offer my full assistance to the committee, to Chairman Markey, 
and also to you, Representative Herseth Sandlin.
    Thank you.
    [The statement of Mr. Troxel follows:] 

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    Ms. Herseth Sandlin. Thank you, Mr. Troxel.
    Our next witness joining us today is Mr. Ford West. He is 
president of The Fertilizer Institute. Mr. West brings 30 years 
of experience with The Fertilizer Institute, representing the 
association before Congress, Federal agencies, and the media.
    We thank you for being here today, Mr. West. You are now 
recognized for 5 minutes.

                   STATEMENT OF FORD B. WEST

    Mr. West. Thank you, Madam Chairman. I appreciate the 
opportunity to be here.
    The fertilizer industry supplies nutrients, such as 
nitrogen, phosphate, and potash, to farmers who grow food for 
America's dinner table. Fertilizer is a strategic commodity in 
food production, because 40 to 60 percent of the world's food 
supply is tied to the use of fertilizers.
    Now, all sectors of our industry will be impacted by 
climate change policy, but I am going to focus on the nitrogen 
sector this morning, which is most vulnerable to the impacts of 
the cap-and-trade system. And it is our goal at the end of the 
day, if Congress passes cap-and-trade, that it will not place 
our industry in a serious competitive disadvantage compared to 
our global fertilizer producers that we compete with, such as 
China, Russia, Venezuela, and will not force the domestic 
fertilizer industry overseas to countries with no carbon 
reduction policies.
    The nitrogen industry uses natural gas as a feedstock or an 
input required to make nitrogen. We use natural gas as an 
ingredient in a fixed chemical process that combines nitrogen 
from the air and hydrogen from natural gas to produce nitrogen 
fertilizer, ammonia, and we produce CO2. And outside 
of changing the laws of chemistry, there is nothing we can do 
to change this process, and 90 percent of the cost of producing 
a ton of ammonia is tied directly to the price of natural gas. 
And so this makes the nitrogen industry one of the most energy-
intensive, greenhouse-gas-intensive, and trade-intensive 
sectors of our economy.
    Now, the industry has worked hard to be as energy efficient 
as we can. We have cut the amount of natural gas used to 
produce a ton of ammonia by 11 percent. Not only does that save 
energy, but it also reduces CO2 emissions, and the 
U.S. EPA estimates that we have cut about 4.5 million tons of 
CO2 equivalent per year out of our production 
process. We want to be more efficient, but the chemical nature 
of our process limits our ability to find much more efficiency 
gains in our production process.
    One of our big concerns here is fuel switching. We don't 
have a very good history with fuel switching when Congress 
repealed the Fuel Use Act in 1987 and allowed utilities to burn 
natural gas to produce electricity. As the utilities began that 
process and went from zero to about 20 percent of our 
electricity produced by burning natural gas, the price of 
natural gas went from like $2 to about $8, and we shut down 26 
nitrogen plants in that process. We were the poster child of 
leakage in that public policy, and it is a challenge we have.
    Currently, we have 29 nitrogen plants operating in the 
U.S.; we import about 55 percent of our nitrogen; and 82 
percent of that nitrogen comes from countries that are not 
necessarily eager to regulate carbon and reduce CO2 
emissions.
    So I would hope you can understand that we have some 
concerns with our remaining domestic nitrogen production as the 
utilities again will turn to natural gases and alternatives to 
generate electricity. And I know that we are trying to go to 
the solar and wind to produce electricity, but the backup, when 
the sun is not shining and the wind is not blowing, is natural 
gas.
    So it is important to understand that fertilizer is a gold 
commodity traded in the world market. We are not only having to 
compete against those countries that are not interested right 
now in climate change policy, but we also have got to be 
concerned with those governments who are signed on to Kyoto who 
are looking for ways to protect their energy-intensive 
industries. And we just hope that this American policy that we 
develop on cap-and-trade doesn't cause us more plant closure 
and raise the amount of imported nitrogen that we have.
    The average nitrogen plant that we have today employs 150 
to 200 people. These are good jobs. The average salary is about 
$75,000. They are located in rural communities. They are good 
jobs, good benefits, and these facilities give a great deal 
back to the communities.
    I think you can see that the price of energy is a major 
concern in agriculture. We did ask the Doane Advisory Service 
to do an analysis of energy costs and what that may mean to 
farmers. It is somewhere around $6 billion to $12 billion 
dollars based on the Lieberman-Warner bill. And that is why you 
find agriculture so concerned about having an offset program 
that they could participate in to help recover some of their 
costs.
    We are very supportive of that. We have been working with 
fertilizer best management practices in Alberta, the province 
of Alberta, to develop a protocol based on the 4R nutrient 
stewardship system. And we think the best management practices 
have a potential to not only increase ag yields, as we are 
called on to increase agriculture production 50 percent by 2025 
and double it by 2050, but we can also enhance fertilizer use, 
significantly reduce emissions of greenhouse gas, and improve 
our water quality.
    I thank you and look forward to your questions.
    [The statement of Mr. West follows:] 

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    Ms. Herseth Sandlin. Thank you, Mr. West.
    Our next witness is Dr. Johannes Lehmann, associate 
professor of soil fertility management and soil biogeochemistry 
at Cornell University, and the world's expert on biochar. Dr. 
Lehmann has conducted research around the world, recently 
studying nutrient and carbon management in the Central Amazon 
for the Federal Research Institution of Forestry.
    Dr. Lehmann, welcome to the select committee. You are now 
recognized.

                 STATEMENT OF JOHANNES LEHMANN

    Mr. Lehmann. Thank you, Chairwoman Herseth Sandlin and 
members of the committee. Thank you for the opportunity to 
discuss biochar for sustainable climate change mitigation and 
global soil.
    Biochar is a fine grain light material that is produced 
through heating of biomass under fire conditions. Upon such 
heating to relatively low temperatures, the chemical properties 
of biomass carbon changes to form structures that are much more 
resistant to microbial degradation.
    Ms. Herseth Sandlin. Sir, could you make sure your 
microphone is on.
    Mr. Lehmann. Through this so-called pyrolysis, biomass can 
be transformed from materials that are subject to rapid 
decomposition to material that decomposes much more slowly, 
thereby creating a long-term carbon sink. Such thermally 
altered material is about 1.5 to 2 orders of magnitude more 
stable in soils than uncharred organic matter, thus creating 
solar carbon pools with a mean resident time of several 
hundreds to thousands of years.
    Biochar production and its application to soil provides 
several additional important value streams beyond direct 
climate change mitigation. These include waste management, 
energy production, and soil improvement. Biochar can be 
produced from a variety of feedstocks that would otherwise 
constitute a financial and environmental liability. Examples 
include animal manures in agricultural regions with high 
phosphorus and nitrogen loadings, green waste that might 
generate nitrous oxide or methane during landfill, or biomass 
from forest thinning for fire prevention.
    The second value stream arises from the bioenergies 
generated during biochar production. Between 2 and 7 units of 
energy can be produced for each unit of energy invested during 
the life cycle of various biochar systems.
    The third value stream is the improvement of soil quality 
upon biochar additions. Crop yields and many less productive 
soils can be significantly increased, and losses of agro 
chemicals, such as fertilizer nutrients, herbicides, and 
pesticides, can be decreased.
    Taken together, these three sources of value can enhance 
food and energy security while also combating climate change.
    Delivered biochar additions to soils have a number of 
implications for carbon trading. Additionality can be 
demonstrated because biochar is currently not added to soil to 
any appreciable extent. Monitoring of biochar sequestration is 
facilitated by the fact that we can easily record the carbon 
that is added at any time, and its sequestration impact does 
not need to develop over time. Verification of sequestration is 
possible because biochars bear a chemical signature that can be 
distinguished from other organic matter and soil.
    The national and global potential of biochar to help 
mitigate climate change is only theoretical at this point 
because too few biochar systems exist at scale of 
implementation. Conservative modeling of the technical 
potential place biochar as an approach to contribute on the 
order of 1 gigatron carbon removal annual by 2050.
    Such widespread adoption of biochar systems will require 
sustainability criteria. Biochar must therefore be integrated 
into existing food production systems and not be an alternative 
for food production; make use of already developed best 
management practices such as conservation agriculture; and 
build on residuecollection systems that are already in 
place.
    While few fully implemented modern biochar systems exist 
worldwide, the necessary engineering and science capacity is 
available to evaluate a diverse set of biochar systems at scale 
of implementation in the near term. In fact, biochar has 
rapidly evolved even over the past 12 months. Evaluation does 
not rely on a fundamental advance in science, but on 
application and adaptation of existing science. The underlying 
technology is robust and sufficiently simple to make it 
applicable to many regions globally.
    Current hurdles to implementation are availability of 
pyrolysis units at sufficient maturity to allow all necessary 
research and development and as a direct consequence a lack of 
demonstrated carbon trading activities, a sufficient 
development of best biochar practices and of demonstration of 
soil health benefits for the full spectrum of agro ecosystems.
    The distributed nature of biochar systems and the potential 
for variability between systems creates significant 
opportunities for sustainability, but also hurdles to 
widespread adoption, regulation, and financial viability.
    Establishment of policies at national and international 
levels is required to remove hurdles to implementation and 
support full evaluation of biochar systems.
    Mechanisms for carbon trading need to be put into place 
that recognize biochar soil carbon sequestration. Methodologies 
must include full lifecycle accounting of emission balances to 
deliver net climate benefits.
    The entire value chain of mitigation approaches must be 
recognized to reward those activities that have multiple 
environmental and societal benefits.
    Biochar must not be an alternative to making dramatic 
reductions in greenhouse gas emissions immediately, but it may 
be an important tool in our arsenal for combating climate 
change.
    Thank you, Madam Chairman.
    [The statement of Mr. Lehmann follows:]

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    Ms. Herseth Sandlin. Thank you, Dr. Lehmann.
    I thank all of our witnesses for their testimony. I will go 
ahead and start out the first set of questions.
    And, Mr. Troxel, I want to spend a few minutes focusing on 
your testimony regarding the substitution of biomass for fossil 
fuels to produce heat, electricity, and transportation fuels.
    If you could discuss what impact the Federal definition of 
renewable biomass in the renewable electricity standard and the 
renewable fuels standard has on developing wood-based sources 
of energy; and, how would including woody biomass from Federal 
lands in the RFS and RES impact Federal forest land management?
    Mr. Troxel. Thank you, Representative Herseth Sandlin. The 
definition of renewable biomass in both the RFS and RES would 
make a great deal of difference in the financial feasibility of 
plants that would either produce electricity or cellulosic 
ethanol because of the financial incentives that are associated 
with both of those pieces of legislation.
    In the case of the RFS definition of renewable biomass, 
woody biomass from the national forest was completely excluded. 
Most of the forest in the Black Hills are Federal Black Hills 
National Forest, and so that whole stream of biomass is taken 
off the table.
    In the current version of the RES, there are really three 
components of woody biomass that would go into any of those 
facilities. There are mill residues. There is slash from the 
slash piles that we saw the picture of, and there are 
precommercial thinnings.
    In the RES definition, the mill residues would be included. 
But the way I read and understand the definition is that the 
precommercial thinnings and the slash piles would be excluded 
from the renewable biomass because of a specific phrase that 
excludes timber from mature forest stands. And that is a term, 
it is a fairly generic term. There is not a definition for it. 
I think it is open to debate or challenge, and especially when 
we get into the Federal process of making decisions that could 
be subject to appeal or litigation, and it just opens a lot of 
uncertainty.
    The other part of the current RES definition that is 
problematic is the requirement that it be harvested in 
environmentally sustainable quantities as determined by the 
appropriate Federal land manager. As foresters, I am completely 
supportive of sustainable quantities and management, but I 
don't know, and this is open to speculation, about what the 
process would be to make that determination and what kind of 
analysis or decision would be required to get there.
    Ms. Herseth Sandlin. Thank you, Mr. Troxel.
    As you may know, we are deep in negotiations as it relates 
to altering the definition that currently exists in the bill 
that was marked up in the Energy and Commerce Committee, and we 
hope to be able to make the changes that you suggest so that we 
are able to utilize precommercial thinnings and other woody 
biomass through current forest management practices on Federal 
forests. But would you like to speak for a minute or two about 
the importance of how this affects private forest owners as 
well?
    Mr. Troxel. Most of the timber lands in the Black Hills are 
Federal. I think it is important, though, to include private 
timber lands and make sure that those private landowners do 
have a chance to contribute toward production of renewable 
energy. And I would encourage you to continue your efforts to 
make sure that that definition does adequately include both 
private and Federal lands.
    Ms. Herseth Sandlin. Thank you, Mr. Troxel.
    I will reserve some of my other questions for the second 
round of questioning and would now recognize the gentlewoman 
from Tennessee, Mrs. Blackburn.
    Mrs. Blackburn. Thank you, Madam Chair.
    And thank you to our witnesses for taking the time to be 
with us today. We all appreciate it.
    I am sorry I was late to the hearing, but as you have 
learned probably from others, today we have three hearings; 
Energy and Commerce has three hearings that are going on. And, 
of course, trying to step into those and then be here is 
tricky. But we have the opportunity to make them all and 
appreciate it.
    Agriculture is a very vital part of the economy in 
Tennessee, which is where my district is found. And we are 
hearing quite a bit about the Waxman-Markey bill and the effect 
it is going to have on agriculture.
    And, Madam Chairman, I have two pages that one of our 
constituents sent over. These are just ag facts. I would love 
to submit those into the record for this hearing if that is 
possible.
    Ms. Herseth Sandlin. Without objection, so entered.
    [The information follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Mrs. Blackburn. Thank you. I appreciate it.
    This is all about agriculture in Tennessee, and it is $44 
billion of our state's economy. That is 11 percent of our 
state's economy. And we have 79,000 farms that are employing 
more than 300,000 people in our state, and over 40 percent of 
our state is actually farmland. So the issues that we are 
discussing today are of vital importance to us on so many 
different levels. And, as I said, people are very concerned 
about what Waxman-Markey is going to do to their livelihood, 
their ability to earn a livelihood.
    The estimate that has come out so far is that the farmers' 
net income would decrease by $23 billion annually over the next 
25 years. We have got a lot of farmers that live off that 
income. And also, the increase in construction costs to farm 
buildings and equipment is expected to be a 5 percent to 10 
percent increase added to whatever the inflationary rate is. So 
when you look at what the farmers are up against with the cost 
of buildings and construction and equipment and maintenance, 
and then you get into actually dealing with the crop itself--
and, Mr. West, fertilizer is a big part of that.
    And when I am in West Tennessee, and we are talking about 
not only the row crops but the soybeans and the cotton, 
fertilizer is a huge component of that.
    Mrs. Blackburn. And what I would like to hear from you, 
what my constituents are asking from me, if cap-and-trade, if 
Waxman-Markey is passed into law, what is it going to do to the 
fertilizer industry? What is it going to do to your prices? And 
equally as important, what is it going to do to the 
availability of the product?
    And you touched on nitrogen. And you touched on the 
offshore competition. And I would like for you to drill down on 
that just a little bit.
    Mr. West. I think the issue for us is availability.
    Mrs. Blackburn. Okay.
    Mr. West. Because, we see the price of natural gas going 
up, and that will affect our agriculture across the board. 
Every $3 increase in natural gas is $1 billion to our industry. 
That is how much gas we use in producing ammonia. And so the 
question becomes are we going to produce a nitrogen fertilizer, 
for example, in the United States? Are we going to import the 
majority of our nitrogen fertilizer?
    Now we import 55 percent today. So we don't set the price 
of nitrogen fertilizer in the United States. It is set in the 
world market. And a year ago, the demand for fertilizer around 
the world as we had a food scare and as you know, we had a big 
conference in Rome in June of last year about scarcity of food, 
we had countries around the world hoarding food. We had 
countries hoarding fertilizer, keeping it off the world market. 
The price of fertilizer went off the charts. And, of course, 
the worldwide drop in the economy has changed that and the 
prices have come down. But if we raise our input costs, the 
world price of fertilizer stays the same, we will shut down our 
production facilities.
    Mrs. Blackburn. I don't want to interrupt you, but I do 
have one other question I want to go to before my time expires.
    Dr. Hatfield, you mentioned that some of the studies show 
that the optimum range of temperature for the crop harvest 
actually increases as CO2 in the atmosphere 
increases. So very quickly how do you see this affecting our 
Southern States like Tennessee?
    Mr. Hatfield. I don't know that we made a statement that 
said that. Would you repeat that?
    Mrs. Blackburn. That the optimum range of temperature for 
crop and harvest increases as CO2 in the atmosphere 
increases.
    Mr. Hatfield. Actually, there are two different processes 
that are going on. Temperature requirements for plants is 
really not linked to the CO2. If we said that, that 
is a misinterpretation. The temperature plays a real role and 
CO2 is really that basic building block in terms of 
taking CO2 through the atmosphere through the 
process of photosynthesis, it grows that. It is temperature 
mediated. And when one of the pieces of that occurs in this is 
not the photosynthetic process but actually the respiration 
process that is affected as well which is entered by 
temperature.
    Mrs. Blackburn. Thank you for that. And my time is expired. 
I will yield back.
    Ms. Herseth Sandlin. I thank the gentleman. I now recognize 
the gentleman from Colorado, Mr. Salazar.
    Mr. Salazar. Thank you, Madam Chair. Mr. Troxel, about 50 
years ago there was a severe insect infestation across the West 
and some of the forests. We find that same problem here today. 
It is significant in Colorado, we have seen many of forests, 
the pictures you have shown today are quite telling.
    Many people actually blame climate change for being the 
sole factor. I mean, this thing has happened. It is kind of 
cyclical. It has happened in the past. Could you comment on 
that?
    Mr. Troxel. Thank you, Representative Salazar. I believe 
the underlying problem is the condition of the forests. And as 
I described the picture in Colorado, it is a single species. 
They are all the same age, and they are in overstocked stands. 
And it seems like this is one of those cases that we have to 
keep relearning the same lessons. And managing a forest is a 
lot like managing a stock portfolio. Diversity is good. Our 
forests in Colorado, our Lodgepole Pine Forests are roughly the 
equivalent of having an entire stock portfolio in Enron several 
years ago. And when it goes south, it all goes south. And that 
is what has happened to our forests.
    Looking ahead what we need to do is concentrate on 
diversity of age classes, diversity of species and keeping 
those stands thin and vigorous and healthy going forward so 
that they are better able to resist and withstand stress and 
not be as susceptible to fires and insect epidemics.
    Mr. Salazar. Thank you very much.
    Dr. Lehmann, to a layman like myself, explain biochar. I 
don't understand it.
    Mr. Lehmann. Thank you, Mr. Salazar. Biochar is very much 
like charcoal in the sense that the organic structures change 
entirely when you heat biomass. For instance, a wood log, you 
cover it in modern pyrolysis units. This is achieved in so-
called reactors where air is excluded from the process. And the 
biomass is heated to about 300 to 600-degrees Celsius.
    At that temperature, the properties of the biomass change 
and there forms so-called charcoal. Charcoal is a substance 
that has been produced throughout the history of humanity at 
all stages. It has been one of the earliest industrial 
processes. So the process is very similar, identical almost, as 
producing charcoal. What it differs is that biochar is produced 
for the purpose of soil amendment. And that means, several 
charcoals may make good biochars but there have been found to 
be a lot of different biochars made from feedstocks that would 
not make a very good fuel, which is what we usually produce 
charcoal for.
    And this biochar material has remarkable properties that 
enhance soil fertility, soil quality. It is like a sponge. It 
is like a substrate where nutrients can hold on to where micro 
organisms can find a habitat. And it has also been dubbed as a 
microbial reef in soil.
    The chemical changes that happen through these so-called 
thermodecomposition, this thermal treatment, is so profound 
that the stability of the organic matter is dramatically 
increased. What was a leaf or a grass that would have 
decomposed within a few days or weeks or months, is now a 
charred leaf that is stable for many decades, hundreds of 
years, even thousands of years.
    Mr. Salazar. So is it like a sponge, then, for example if 
you apply nitrogen fertilizer to the soil, will that actually 
hold the nutrient and release it as the plant needs it?
    Mr. Lehmann. Yes, very similar to, we are all very familiar 
with the value of soil organic matter. Every farmer, every 
gardener will agree that when we increase soil organic matter, 
we hold nutrients in the soil. We improve soil plant growth 
ability.
    And very much the same is happening with biochar. The 
interesting aspect is that biochar is more effective in 
providing these attributes, these desirable attributes of soil 
organic matter than, for instance, other organic material 
because it is more stable and it has a higher surface area, it 
has a certain structure that provides this ability.
    Mr. Salazar. Thank you. My time is expired.
    Ms. Herseth Sandlin. Thank you. I thank the gentleman. The 
Chair now recognizes the gentlewoman from California, Ms. 
Speier.
    Ms. Speier. Thank you, Madam Chairman.
    Dr. Lehmann, let me ask you. There is great exciting news 
coming from companies like yours that suggest that if we pursue 
biofuels, we are going to see a reduction in greenhouse gases 
of some 70 percent. A company in my district called Solazyme 
that is using algae to produce aviation fuel right now and has 
the potential of producing it for cars as well. Its big 
problem, and I am wondering if it is yours, as well, is the 
fact that it needs to gear up. It needs the resources to be 
able to create a large facility so that it can, in fact, 
produce the products in large volumes. I guess my question to 
you is what do you recommend that Congress do to focus on the 
technical and economic challenges that many of you are facing 
in your efforts to scale up?
    Mr. Lehmann. Thank you, Ms. Speier, for the question. Just 
for the record, I am not a representative of a company, but I 
am a university professor and have no company affiliations.
    You are asking about the fuel production ability of bio in 
the energy stream using pyrolysis. And that is correct, 
pyrolysis is able to generate fuels and so are other bioenergy 
streams that you mentioned, fermentation, even combustion. 
Bioenergy, as a whole, needs to deliver net climate and net 
environmental benefits. And we need to look at the full life 
cycle impact both economically as well as from a carbon 
footprint point of view, that I think we have learned the hard 
lesson with the current ethanol debate.
    Biomass in itself is a, in many instances, a commodity that 
is distributed in the landscape, and that means that when they 
need to be gathered, carbon needs to be invested to achieve 
that. It is a handling issue. It is a storage issue. And so we 
need to look hard at those opportunities where we can harness 
the most environmental and climate benefits.
    Colleague Troxel has already shown us a few examples where 
biomass actually constitutes, or biomass burning, the 
decomposition and die-back of forests constitute an 
environmental and economic liability. These are opportunities 
that can be harnessed first.
    There needs to be very judicious discussion and very 
judicious observation of biomass bioenergy to be sure to 
develop net climate and net economic benefits. Thank you.
    Ms. Speier. Let me further ask you. We make the mistake 
from time to time of picking winners and losers, whether it is 
in health or, in this case, choosing ethanol over other 
potential alternative fuels, and finding out that, in fact, 
there are huge repercussions.
    Do you have any recommendations to us on how we go about 
being somewhat more neutral in allowing those that are in the 
area of producing new alternatives to be able to do so in a way 
that don't create a winner or a loser and yet also gives the 
opportunity for the entities that are out there to gear up?
    Mr. Lehmann. That is a very good question. And it is indeed 
important to not pick winners or losers because there will 
likely be opportunities for many different avenues and they 
need to be geared to the local conditions. And what is worse 
probably they will change over time even during the course of 
the year which biomass streams are viable. So we need to look 
at integrated concepts of bioenergy.
    And there are initiatives underway by companies as well as 
by academic institutions and research organizations to look at 
bioenergy as an integrated concept not as just a one side track 
for dealing with biomass. And that is very important.
    Ms. Speier. Thank you. I yield back.
    Ms. Herseth Sandlin. I thank the gentlewoman.
    The Chair now recognizes the gentleman from Washington, Mr. 
Inslee.
    Mr. Inslee. Thank you.
    Mr. West, I have read your testimony. I am sorry I didn't 
get to hear it. But I have read your testimony. And I want to 
ask you a couple of questions about this important subject. In 
the underlying text of the bill that has passed the Commerce 
Committee, we have a provision that is called the Doyle-Inslee 
amendment that has free allowances to trade-sensitive, energy-
intensive industries, and it is my understanding that the 
fertilizer industry would qualify for that, both as trade 
sensitive and energy intensive.
    Is that your understanding?
    Mr. West. That is my understanding, yes, and thank you for 
doing that, putting it in there.
    Mr. Inslee. I appreciate that.
    How would you quantify the benefits to the industry in that 
regard? Have you put a dollar figure on it or a percentage of 
cost?
    Mr. West. Well, we are subject to those free allowances. As 
you know, 15 percent of the total allowance is set aside for 
energy-intensive energies. We are probably one of what, 45, 50 
sectors that would be eligible for that.
    Right now I don't know exactly how many allowances we are 
going to be able to receive from that because, as you know, we 
have going to through the rulemaking and let EPA and everybody 
report. My gut tells me that there is probably not enough in 
there.
    And I would love to see the nitrogenous sector with a set 
amount so that we can plan a little bit more about what that 
means to us and can we survive in the global economy over say 
that 10 years that that is going to be available.
    Mr. Inslee. When Mr. Doyle and I were doing this, we wanted 
to be fairly aggressive in protecting these sectors. And I 
think it is a pretty good slug of allowances that we have come 
up with. But your concern is that your natural gas increases 
would be larger than the value of those allowances? Is that 
your concern?
    Mr. West. That is correct. Your provision deals with as you 
know direct and indirect costs. And then we have this big old 
boogie man out here of what is the cost of natural gas, $3.5 
today. We seem to have a lot of natural gas, but everybody 
seems to be turning to natural gas and natural gas is the 
environmental fuel of choice. And if we don't get this right, 
our allowances will be eaten up by the price of natural gas. 
And we won't be competitive in the world market.
    Mr. Inslee. The EPA, I am told, and I haven't read this in 
detail, but I am told that the EPA did an assessment of this 
and found that there really, they didn't feel there would be 
natural gas price spikes associated with this that you fear. 
Have you looked at their assessment?
    Mr. West. I don't know if I have looked at their 
assessment. But natural gas has spiked above $10 three times 
since 2000. So it is going to be very difficult not to put, 
with the demand for natural gas, that natural gas prices will 
not increase as everybody turns to it.
    Mr. Inslee. I am told that their assessment suggested that, 
and I am not saying there won't be spikes in natural gas and 
they are not saying that either. It is spiked without this 
bill. There have been big spikes in natural gas without this 
legislation of course. The question is what this legislation 
would do.
    And my understanding of their conclusion is that the 
combination of the free allowances, the fact that we have got 
considerable natural gas supplies still subject to development, 
the fact that we have got significant efficiencies we are all 
still working on, the fact that there are other alternatives 
besides natural gas, it is not the only one, they have 
concluded that they didn't see a probability--we are all 
dealing, you describe it as the boogie man, maybe that is the 
right way to look at it, we deal with possibilities and 
probabilities here. But they felt that the probability was that 
we wouldn't experience that. And if you have any critiques of 
that assessment, send it by. We would love to see it. And thank 
you for your testimony.
    Mr. West. Thank you.
    Ms. Herseth Sandlin. We have less than 5 minutes remaining 
in a very long series of votes. If this were normal series of 
votes, we would recess for a period of time and come back for 
additional questions that I and others have. But there are at 
least 28 votes in this series. And so I would encourage my 
colleagues to submit any additional questions that they have 
for the record. I have a series as it relates to incentives and 
tools for agriculture to employ to adapt and what H.R. 2454, 
how it addresses those incentives or tools as well as 
sufficiently robust offsets program that Mr. West explained.
    But I want to emphasize to our panelists today the 
importance of your testimony. As I stated previously, 
negotiations are intense and ongoing as it relates to possible 
changes to the draft that was marked up in the Energy and 
Commerce Committee. And the upcoming days and possibly few 
extra weeks are immensely important. And the issue of 
agriculture and forestry is a primary focus of those 
negotiations.
    So we appreciate your testimony.
    We will submit our questions to you in writing and hope 
that you will have time to get back to us as quickly as 
possible based on the impact that your responses could have for 
those negotiations that are ongoing. So I want to thank all of 
our witnesses today.
    I thank my colleagues for their participation.
    And the hearing now stands adjourned.
    [Whereupon, at 10:50 a.m., the committee was adjourned.]

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