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Carbon Markets and Methane Digesters: Potential Implications forthe Dairy Sector

Published online by Cambridge University Press:  26 January 2015

Nigel Key  and
Stacy Sneeringer
Nigel Key
Affiliation:
Economic Research Service in the U.S. Department of Agriculture, Washington, DC
Stacy Sneeringer
Affiliation:
Economic Research Service in the U.S. Department of Agriculture, Washington, DC
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Abstract

Anaerobic digesters that capture and burn manure methane can provide arenewable source of energy and reduce greenhouse gas emissions. Payingproducers for these emission reductions—either directly or through a carbonoffset market—could substantially increase digester adoption. However, thereis likely to be wide variation in the scale, location, and characteristicsof adopters, so these policies could have long run structural implicationsfor the livestock sector. Using a model of digester profits and data from anationally-representative survey of dairy operations we estimate the likelydistribution of digester adoption and profits under different carbon pricescenarios.

Keywords

anaerobic digester, carbon offsets, climate change, distribution,livestock, methaneQ12Q16Q42Q54Q58
Type
Research Article
Information
Journal of Agricultural and Applied Economics , Volume 43 , Issue 4 , November 2011 , pp. 569 - 590
Copyright
Copyright © Southern Agricultural Economics Association 2011

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