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IDFA Questions Fairness of Cap-and-Trade Program in House Climate Bill

Jun 30, 2009

By a vote of 219-212, the U.S. House of Representatives passed on Friday a comprehensive climate change bill that includes a cap-and-trade program designed to reduce greenhouse gas emissions across all industries. Prior to the vote, IDFA and other food industry groups warned House leaders that the sweeping legislation could have a negative impact on food prices and accessibility.

While the bill offers transition assistance to help control price increases in electricity, natural gas and home heating oil for consumers, it did not provide similar assistance for the impact of higher food prices. In a letter sent last week to House Speaker Nancy Pelosi (D-CA) and Minority Leader John Boehner (R-OH), IDFA and others called for a climate-change approach that would provide equitable treatment for all industries.

"When you include all of our suppliers, the food, feed and beverage sector has the fourth largest exposure to carbon costs," said Jerry Slominski, IDFA senior vice president of legislative affairs and economic policy. "We want to assure that Congress is fully considering these impacts as this legislation moves forward."

The cap-and-trade program establishes a cap, or limit, on allowable greenhouse gas emissions and lets manufacturers and other companies trade pollution permits, or allowances. Over time the cap would be reduced, increasing the cost of pollution permits and forcing companies to find greener ways to operate. The program is scheduled to begin in 2012.

Although the Senate has yet to consider climate change legislation, many expect the path to passage there to be much more difficult.

"IDFA will continue to work with Congress to assure that any climate change legislation balances greenhouse gas reductions with our nation's need for an abundant and affordable food supply," Slominski said.

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