How the Inflation Reduction Act could impact the Mississippi River

by Trevor Russell

The Inflation Reduction Act includes substantial funding for climate-friendly agriculture, provisions which could be a boon for clean-water crops and the health of the Mississippi River. (Photo by David Wheaton for FMR)

By now, you've seen the headlines. A stunning compromise on the Inflation Reduction Act of 2022 sets the stage for nearly $370 billion in new spending on climate change and energy security programs over the next 10 years.

Added together, these policy and funding initiatives could put the U.S. on track to reduce greenhouse gas emissions by 40% by 2030.

A first take

There's a lot to like. The bill includes significant new incentives for clean energy, agricultural conservation, electric vehicles, offshore wind production and environmental justice funding. And it would spur domestic manufacturing of clean energy technologies to accelerate our transition away from fossil fuels.

We've been excited to sign on to an endorsement letter to support IRA's climate-smart agriculture investments, and look forward to supporting other river-positive aspects.

What this bill could mean for agriculture, water quality and the Mississippi River

Addressing climate change head-on is critical for the health of the Mississippi River, in part because of the link between climate and water quality. Unmitigated climate change is expected to supercharge runoff pollution in Minnesota by an additional 24% this century — an increase that would make achieving our state's clean water goals virtually impossible.

Agriculture is a significant driver of this runoff pollution, and as Minnesota's recent climate change report shows, our state is not meeting our climate goals. Nor are we making progress on agriculture climate mitigation.

That's why we're excited that the bill includes over $21 billion for climate-friendly agriculture, United States Department of Agriculture conservation programs and conservation technical assistance.

What's more, several measures in the proposed legislation not only help address greenhouse gas emissions from the farm sector but will do so in a way that helps improve water quality, soil health and habitat. Specifically, the bill includes:

  • Climate-friendly farmland conservation ($11.7 billion): The bill includes $3.25 billion for the Conservation Stewardship Program and $8.45 billion for Environmental Quality Incentives Program. Programs like these provide technical and financial support to farmers to reduce greenhouse gas emissions and improve soil health.
  • The Regional Conservation Partnership Program ($6.75 billion): Through the Regional Conservation Partnership Program, the U.S. Department of Agriculture's Natural Resources Conservation Service partners with state agencies, NGOs and others to provide financial and technical assistance to farmers in implementing conservation practices.
  • Agricultural Conservation Easement Program ($1.4 billion): The Agricultural Conservation Easement Program helps private landowners, land trusts and other entities to preserve working farms and ranches and restore, protect and enhance wetlands and grasslands through long-term conservation easements.
  • Conservation Technical Assistance ($1 billion): The Conservation Technical Assistance Program provides farmers with the knowledge and tools they need to conserve, maintain and restore the natural resources on their lands, including addressing erosion, water quality, water conservation and agricultural waste issues.
  • Agricultural carbon sequestration and emission quantification ($300 million): As we've noted previously, more research is required to better understand the complexities of agricultural carbon sequestration on active croplands. Investing in carbon sequestration tracking and greenhouse gas emissions quantification programs is critical to our success.
  • Sustainable Aviation Biofuel Credit: The bill establishes new credits for sustainable aviation biofuels that could accelerate the adoption of winter-annual oilseeds such as camelina and pennycress under development through the University of Minnesota's Forever Green Initiative. These crops show huge promise for water quality, pollinators, soil health and farm prosperity.

Each of these provisions can help accelerate the adoption of continuous living cover cropping systems in Minnesota and the upper Midwest — one of FMR's main goals to improve water quality. These cropping systems also help address the climate impacts of our modern row-crop agricultural systems while enhancing habitat and pollinator health. 

Cause for concern?

In a bill of this scope, there will be provisions that we don't fully embrace. While the overall bill makes important strides toward a more sustainable climate, the reality is that the bill is a compromise that includes items that pose real risks to the Mississippi River. Two items jumped out at us immediately:

Expansion of ethanol infrastructure

The bill provides $500 million for upgrading gas stations to dispense higher blends of ethanol. That infrastructure update would open the door to pushing for ever-higher blends of ethanol in our gasoline, a trend that is closely tied to an alarming loss of conservation lands, including more than 2 million acres of grasslands lost to the plow in Minnesota just since 2012. While $500 million nationwide is a tiny fraction of the cost of upgrading gas stations to dispense higher ethanol blends (the costs for Minnesota alone could approach $800 million), this is a concerning signal from lawmakers in D.C. 

Carbon capture and storage — for enhanced oil recovery?

The bill incentivizes carbon capture and storage technology, an important but largely yet-unproven tool in reducing greenhouse gas emissions. However, we are concerned that this bill could in turn accelerate investment in multi-state carbon pipeline construction that has raised serious concerns in the environmental community, in part due to implications for "enhanced oil recovery" projects where captured carbon is injected into depleted oil fields to boost oil production. Given the state's uneven track record in preventing pipeline construction from harming our waters, this is a provision we'll be watching closely.

This bill also opens up millions of acres of land and water for new fossil fuel extraction, a move that is necessary to secure passage but which, in turn, at least partially undermines the net positive impacts of the bill.

Looking ahead

Though the bill has been signed into law by President Biden, this work is not yet done. The specifics of how each river-friendly funding item is administered will require ongoing oversight. In particular, the mechanics of the new aviation biofuels incentive will heavily influence how quickly new winter annual oilseed crops like Camelina and Pennycress make their way into Minnesota's cropland acres. FMR will be following these developments closely to ensure that these investments address our climate challenge while helping to protect and restore our great river. 

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