Papers with the Inflation Reduction Act and US flag.

By David Bryngelsson, CEO of CarbonCloud

The Inflation Reduction Act is undeniably an event to celebrate. However, its minimal and questionable action for food and agriculture puts the bill’s success at risk. If the USA, or the global society, is to reach the goals of the Paris agreement, the food system must be addressed on par with energy.

On August 16, President Joe Biden signed the Inflation Reduction Act (IRA), a game-changing bill that includes $369 billion to address energy security and climate change. While the bill provides much-needed incentives for heat pumps, electric vehicles, and induction stove tops, food is missing. Agriculture alone is responsible for 11% of total US emissions, and with a mere 5% of the climate budget, it is disadvantaged.

To start with, the incentives included in the bill have a questionable effect. Almost $20 billion will be spent on climate smart agricultural practices and use of less fertilizer. As beneficial as these practices have proven to be for soil health, the results on reducing emissions remain uncertain. Such practices take time to bring a return on the climate investment – if any.

Methane emissions have taken their rightful place in the bill but are unjustifiably limited to the oil and gas industry, completely leaving out agriculture, which comprises 36% of total US methane emissions. Agricultural methane emissions have increased over the last 30 years, while methane emissions from natural gas, petroleum, and landfills have decreased. This is evidence that agricultural methane emissions are a systematically unaddressed growing risk.

Acknowledging the food system’s role in climate change and incentivizing a climate-smart modus operandi for the thousands of individuals working in it is imperative. This makes the IRA a missed opportunity for the food system – but it doesn’t have to be. Here are three key incentives that could make a difference in reducing emissions from food.

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Consumer emissions reductions

Consumers are well aware that switching their internal combustion engine vehicle to an electric one can reduce their footprint – and are rightfully rebated for doing so. However, there are no incentives for changing food habits, 10-30% of a household’s emissions. A lower tax rate on food products with low emissions would make a difference in consumers’ choices – especially lower income households, where a larger percentage of their total climate footprint comes from food. This initiative entails knowing the carbon footprint of food products – data which is based on credible, official sources and readily available.

Methane emissions reduction

Methane-reducing feeds are still awaiting approval in the United States. Resources to intensify their approval process and rebates for their application could reduce the 36% of methane emissions from livestock and manure management by a quarter.

Corporate emissions reductions

Part of the allocated $27 billion Greenhouse Gas Reduction Fund for private investments administered by the EPA can and should be directed to the food industry in proportion to their contribution to the national emissions. A rebate per ton of CO2e reduced from the baseline year will propel food corporations to actively work with emissions reduction. In addition to the upcoming reporting standardization funded by the IRA, establishing an emissions baseline and acting with proven return of investment becomes the oil in the cog of delegating responsibility and rewarding it.

Nevertheless, the IRA delivers on one critical issue. The EPA will receive $5 million to carry out a standardization and transparency program in corporate emissions reporting, including corporate climate action commitments and plans. This is an important action to stepping forward from the standardization paralysis that is currently slowing down climate action across industries.

CarbonCloud applauds the efforts that have been included so far and urges the US government to take further action and give the food industry the attention it needs to keep the Paris Agreement targets alive.

David Bryngelsson is CEO of CarbonCloud, a climate intelligence platform for the food industry. The SaaS platform delivers climate footprint insights for critical climate action across the entire food industry. It houses the most sophisticated dataset of climate footprints for food embedded in a digital architecture that enables increasing transparency and data definition across food supply chains.