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 you very much mister 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 two 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 co 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 domestic nitrogen fertilizer industry supplied about eighty five percent of america's nitrogen in the s but the high cost of natural gas has moved much of this production and its jobs overseas today just fifty five 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 and tax and their energy efficiency is generally lower than that in the united states mister west cites a study by the doane advisory services that shows that a cap and tax scheme would add six dollars billion to twelve dollars billion in additional costs for farmers by two thousand and twenty 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 eight dollars billion in two thousand and twelve and by more than fifty  billion in two thousand and thirty five the average net income loss between two thousand and ten and two thousand and thirty five is projected to be twenty three dollars billion with numbers like these it isn't surprising that thirty seven 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 two billion tons of offsets per year one 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 fo 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 princip mister 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 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 mister chairman for the work that you have done 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  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 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  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 twenty five 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 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 th produce in our state at least generally depending of course on weather conditions about three hundred and eighty two 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 two 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 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 s department of agriculture and the lead author on the agriculture chapter in the global climate change impacts on the united states report doctor hatfield has had a distinguished scientific career authoring over three hundred and twenty five 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 beg 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 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 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  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 three point five percent while in the midwest they are projected to increase by two point five 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 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  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 weatherdaggersensitive periods in the growing  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 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 ms cooley thank you mister 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 release earlier this week demonstrate that climate change is already affecting u s freshwater resources and that these impacts will intensify in the future the us geological survey regularly reports that agriculture uses seventy percent of the nation 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 six dollars billion to eight dollars 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  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 one 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 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 mister tom troxel tom is the director of the black hills forest resource association mister 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 ten years or longer than that but ten 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 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 epidemic 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 photo 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 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 bio s my last slide is a picture of the case number one 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 one thousand eight hundred and ninety nine this area has been thinned and harvested several times since one thousand eight hundred and ninety nine since then approximately six billion board feet have been harvested from the black hills national forest and at the same time the standing volume has increased from about five billion board feet to almost six 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 m our next witness joining us today is mister ford west he is president of the fertilizer institute mister west brings thirty years of experience with the fertilizer institute representing the association before congress federal agencies and the media we thank you for being here today mister west you are now recognized for five minutes mister 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 forty to sixty 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 polic 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 co and outside of changing the laws of chemistry there is nothing we can do to change this process and ninety 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  we can we have cut the amount of natural gas used to produce a ton of ammonia by eleven percent not only does that save energy but it also reduces co emissions and the  estimates that we have cut about four point five million tons of co 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  seven and allowed utilities to burn natural gas to produce electricity as the utilities began that process and went from zero to about twenty percent of our electricity produced by burning natural gas the price of natural gas went from like two dollars to about eight dollars and we shut down twenty six 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 twenty nine nitrogen plants operating in the u s we import about fifty five percent of our nitrogen and eighty two percent of that nitrogen comes from countries that are not necessarily eager to regulate carbon and red 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  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  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 fifty percent by two thousand and twenty five and double it by two thousand and fifty but we can professor of soil fertility management and soil biogeochemistry at cornell university and the world's expert on biochar doctor lehmann has conducted research around the world recently studying nutrient and carbon management in the central amazon for the 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 thinning for fire prevention the second value stream arises from the bioenergies generated during biochar production between two and seven 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 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 it 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 one gigatron carbon remov already developed best management practices such as conservation agriculture and build on residuedaggercollection 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 twelve months evaluation does not rely on a fundamental 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 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 sandlin thank you doctor lehmann i thank all of our witnesses for their testimony i will go ahead and start out the first set of questions and mister troxel i want to spend a few minutes focusing on your testimony regarding the 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 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 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 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 mister 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 would now recognize the gentlewoman from tennessee misess blackburn misess 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 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 of our state's economy and we have seventy nine thousand farms that are employing more than three hundred zero people in our state and over forty 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 twenty three dollars billion annually over the next twenty five 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 five percent to ten 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 mister 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  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 i think the issue for us is availability misess blackburn okay mister west because we see the price of natural gas going up and that will affect our agriculture across the board every three dollars increase in natural gas 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 fifty five percent today so we don't set the price of nitrogen fertilizer in the united states it is set in the world mar 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 you mentioned that some of the studies show that the optimum range of temperature for the crop harvest actually increases as co in the atmosphere increases so very quickly how do you see this affecting our southern states like tennessee 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 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 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 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 mister salazar so is it like a sponge then for example if you apply nitrogen fertilizer to the soil will that actually hold 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 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 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 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 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  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 probably one of what forty five fifty 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  gas has spiked above ten dollars three times since two thousand so it is going to be very difficult not to put with the demand for natural gas that natural gas prices  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 would recess for a period of time and come back for additional questions that i and others have but there are at least twenty eight 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 two thousand four hundred and fifty four how it addresses those incentives or tools as well as sufficiently robust offsets program that mister 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 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 stand