Marginal Abatement Cost Curves for Greenhouse Gas Mitigation on U.S. Farms and Ranches (Updated)

Executive Summary: This work provides estimates of the costs of greenhouse gas (GHG) mitigation that would occur on working U.S. farms and ranches for specific suites of technologies and practices. Understanding the costs and greenhouse gas benefits is important in helping U.S. farmers create new and expand existing market opportunities for agricultural commodities produced with “climate-smart” farming practices. This report provides a valuable update to past studies the Office of the Chief Economist commissioned in 2013 and 2016. First, we have expanded the set of practices to include biochar amendments, alternate wetting-and-drying during rice production, cover crops, feed management strategies, enhanced efficiency fertilizers, and prescribed grazing. Second, we have updated cost and greenhouse gas reduction estimates for several practices included in past studies, like conservation tillage and manure management, based on more recent data. The content is provided in a series of fact sheets. Each fact sheet describes the methodology and assumptions used by ICF International to develop the cost curves. Specifically, the fact sheets describe how they determined business-as-usual farming practices, the percentage of farms that would undertake mitigation practices, GHG mitigation estimates for climate-smart farming practices, cost functions for climate-smart practices, byproduct revenue if applicable (e.g., biogas sales from digesters), and, finally, the marginal abatement cost curves for that practice. Some of the fact sheets have several marginal abatement cost curves that reflect sensitivity analysis we performed with respect to certain parameters. There are some limitations of these curves that readers should be cognizant of when interpreting them. First, the curves are static in the sense that they represent annual potential mitigation consistent with a given cost. However, the costs of “climate-smart practices” and the GHG mitigation from them can vary over time. Second, since we developed the curves on a practice-by-practice basis, they do not account for shifts in costs and GHG mitigation that would occur if a farm were to undertake multiple practices (i.e., cover crops and conservation tillage) at the same time.