Beet industry fears carbon tax

Beet growers
want ag exemption
for coal-burning processing plants

By DAVE WILKINS

Capital Press

While some U.S. farmers see opportunity in cap and trade legislation, sugar beet growers see potential liability because of their ownership of carbon-emitting processing plants.

All U.S. sugar beet processing plants are controlled by grower-owned cooperatives, so beet farmers could be especially vulnerable to cap and trade laws, according to industry officials.

Many sugar beet factories burn coal as part of the process of converting beets into refined sugar.

Proposed cap an trade legislation would add significantly to the cost of processing, said Mark Duffin, executive director of the Idaho Sugarbeet Growers Association.

"Our factories are where we are particularly vulnerable to cap and trade legislation," Duffin said during a presentation Feb. 8 at the Idaho Ag Summit in Boise.

Duffin said provisions contained in a draft Senate bill could cost the industry tens of millions of dollars in the first year of the program alone, according to an analysis by the Energy Information Administration, an independent analytical and statistical agency within the Department of Energy.

The bill would result in what amounts to a $3,000 to $4,500 tax on each of the nation's 10,000 sugar beet farmers in the first year of the program, he said.

The total costs to the sector over the first 12 years could be as high as $650 million, according to the study.

If cap and trade legislation applied only to growing operations, sugar beet farmers could probably live with it, Duffin said. But factory ownership "changes the whole scenario," he said.

The industry wants sugar beet factories brought under an agricultural exemption.

"Our sugar factories are an extension of our farms," Duffin said.

"We want to be responsible citizens, but we want (cap and trade) to be something that accomplishes its goals without putting an undue burden on the industry," he said.

The industry is looking at ways to reduce its carbon footprint.

A DOE grant announced last fall will analyze the feasibility of building a 100-megawatt combined heat and natural gas powered generation plant at the Amalgamated Sugar Co. factory at Nampa, Idaho.

The plant's carbon emissions using natural gas "would be a lot less than with coal," company president Vic Jaro said. "It would offer some real substantial improvements."

If the study shows the natural gas plant to be feasible, the Idaho sugar beet industry will be well ahead of the curve, said Paul Kjellander, administrator of the Idaho Office of Energy Resources. If it's not feasible, at least the industry will know what not to spend time and money on in the future, he said.