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Agricultural Sector Should Actively Prepare Countermeasures
In the midst of growing concerns on climate change worldwide, pressure is getting stronger on Korea to take part in the duties imposed to reduce greenhouse gases. In case Korea decides to join the climate pact, which aims to cut greenhouse gases by 5% from the emissions level of 2000 beginning in 2013, it is expected that Korea’s joining the pact would provide the nation an opportunity on one hand but a risk factor on the other. In consequence, Korea is in urgent need to draw up countermeasures.
In a recent report on the effects of climate pact on agriculture, KREI researcher Kim Chang-Gil said that Korea will be ever more pressured to cut greenhouse gas emissions. Even though the nation can wield surplus emission rights in produce farming, the livestock sector’s emissions exceed a permissible level. Hence, he points out, the nation should actively seek measures such as taking part in the trading of emission credits and saving of greenhouse gas reduction costs.
The Need to Actively Utilize Surplus Emission Rights in Produce Farming
According to the report, it is found that if the volume of permissible greenhouse gas emissions in 2013 is reduced by 5% from that of the base year 2000, the emission volume in produce farming as opposed to animal husbandry is forecast to fall to 7.888 million CO2, a 14.7% drop from the base year’s figure. In that case, the nation will be able to exercise surplus emission rights equal to about 2 million five thousand tons/CO2.
As a result, it is expected that if the agricultural sector participates in the trading of emission rights the industry will earn 69.8 billion won in 2013 through the selling of surplus emission rights generated by emission reductions in produce farming.
The Livestock Industry May Save 86% of Emission Reduction Costs
The livestock industry stands on the brink of incurring immensely high emission reduction costs as compared with other industries. As a result of increases in the number of reared animals that will accompany emission reduction obligations, the industry needs to prepare a systematic strategy that includes emission rights trading and technology innovations to reduce greenhouse gases, Kim points out.
According to estimations of the report, it is found that when the permissible level of greenhouse gas emissions is lowered by 5% from that of the year 2000, reduction obligations in the livestock sector will amount to 300,000 tons/CO2 in the case of cattle, 126,000 tons/CO2 for hogs, and 56,000~59,000 tons/CO2 for poultry. The figures amount to approximately 170,000 heads of cattle, 1.03 million hogs, and 45.7 million chickens, respectively.
When the livestock sector tries to achieve greenhouse gas abatement through individual means, such as cuts in the number of reared animals, the reduction costs are forecast to reach 603~637.5 billion won in 2013 due to an extremely high unit cost of reduction. However, the report said that if the livestock sector joins in the trading of carbon credits it could reduce up to 86% of reduction costs that will amount to only 86.4 billion won at most.
Carbon Tax to Raise Operating Costs of Greenhouse Farming
If carbon taxes are levied on greenhouse vegetables and flowers, the report finds, the burden of operating greenhouse farming in the short run will increase substantially higher, thus pressuring businesses that are highly dependent on fossil fuels.
If carbon taxes are levied on fossil fuels with a tax rate of 30%, it is found that operating costs for greenhouse farming will rise. The operating cost for tangerines is forecast to increase by the highest with an increase rate of 18.9%. This will be followed by the operating costs for roses and cucumbers with increase rates of 11.2% and 10.7%, respectively.
As for livestock animals, too, the operating costs are found to be increasing in the order of hogs (6.7%), hens (6.4%), brood cattle (6.2%), milk cows (4.0%), and meat cattle (3.2%).
Carbon dioxide emissions can be cut by replacing energy source or improving energy efficiency. However, the principal way to cut methane and nitrous oxide emission is to reduce the number of reared animals. Accordingly, Kim points out, the agricultural industry needs to set up effective countermeasures as there is a high chance for the agricultural sector to face relatively high reduction costs.
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