As the deadline for Congress to pass a new farm bill rapidly approaches, it is critical that the clean transportation sector pays attention. Rural development initiatives, renewable energy investment, utility support, and vehicle incentives are just some of the opportunities presented in the proposed legislation — initiatives that can only be fully realized if the bill passes.
What is the farm bill?
Every five years, Congress passes legislation setting national agriculture, conservation, forestry, and nutrition policy; this legislation is referred to colloquially as the “farm bill.” The legislation requires alignment of both the House and Senate. U.S. Senate Agriculture, Nutrition, and Forestry Committee Chairwoman Debbie Stabenow (D-MI) released the “Rural Prosperity and Food Security Act” in May 2024, a detailed sketch of a package including over 100 bills. In the House, U.S. House of Representatives Agriculture Committee Chairman Glen Thompson (R-PA), introduced the “Farm, Food, and National Security Act of 2024” in May 2024.
The suite of proposed bills funnels $1.5 trillion over 10 years to a variety of existing and new initiatives including commodity pricing, conservation programs, food export subsidy, nutrition programs, federal loan programs, rural development, research, forestry, energy development, horticulture, crop insurance, and more. Because of the investment and scope, gaining broad-bipartisan support for these bills to move forward is a challenging endeavor. No votes have occurred yet, reducing likelihood of bills passing Congress before the current expiration date of September 30, 2024. If the bill fails to pass, the current bill, last updated in 2018, will be extended until September 30, 2025.
In recent years, the farm bill has played an increasingly large role addressing climate change. Among many purposes, the farm bill serves as a safety-net for farmers facing extreme weather events — events which are exacerbated by greenhouse gas emission (GHG)–driven climate change. Yet this focus on climate and climate-smart investments has drawn attack from Republicans, who are pushing for language that does not prioritize GHGs reduction in programmatic purposes.
Despite these challenges, draft language continues, expands, and puts forth a variety of programs that offer critical support to the growing clean transportation sector. A few areas to watch include:
Incentives for Zero-Emission Vehicles (ZEVs)
While zero-emission vehicles (ZEVs) are not a focal point of farm bill funding, agricultural producers are increasingly considering the role of ZEVs in operations. This is spurred by both regulations (such as California’s Advanced Clean Fleets) and interest in pursuing air quality improvement efforts. These efforts are aided by funding, including the Environmental Quality Incentive Program (EQIP). EQIP is the Natural Resources Conservation Service’s (NRCS) flagship program providing financial assistance to agricultural produces and forest landowners. In fiscal year 2024 EQIP, the NRCS expanded eligible programs to include ZEVs as eligible climate-smart agriculture and forestry mitigation activities.
Both the Senate and House versions of the Bill include continued funding for the Environmental Quality Incentive Program (EQIP). The Senate’s version of the farm bill expands the purpose of Environmental Quality Incentive Program (EQIP) to promote environmental quality and climate change adaptation. The language reflects the compatible goals of agriculture and forestry with conservation practices, including GHG reductions. With an expanded programmatic purpose — explicitly including climate change adaptation and GHG reduction as program goals — funding for ZEVs may expand.
Similarly, the Senate bill expands the definition of the Conservation Stewardship Program (CSP) to include mitigating GHG emissions. On the other hand, Conservation Innovation Grants (CIG) are not included in this expanded definition and there is no increased funding for air quality initiatives proposed.
Renewable Energy Investments
The USDA has long played a role in energy production and distribution, by virtue of its association with rural communities. Thus, both the Senate and House farm bills include support of energy investments—including renewable energy.
Most critical is the USDA Rural Development’s Rural Energy for America Program (REAP), which provides guaranteed loans and grants to both agricultural producers and rural small businesses. The loans and grants support renewable energy systems and energy efficiency improvements including installing renewable energy systems such as solar, wind, and hydrogen and making energy efficiency improvements such as upgrading heating and cooling systems and switching from diesel to electric irrigation motors.
Other highlights in the Senate’s version include: a new Regional Demonstration Project initiative to demonstrate on-farm carbon emission reduction projects through energy efficiency improvements and renewable energy systems; promotion of agrivoltaics projects; and expansion of the definition of qualified loans for the Federal Agricultural Mortgage Corporation to include USDA energy infrastructure loans.
Continued Support for Biofuel
Predictably, both bills include continued support for biofuels, framing the importance of biofuels as both critical for energy security and as a key transition fuel as systems are weaned off fossil-fuels. Both bills continue support for programs such as the BioPreferred Program and the Higher Blends Initiative. Additionally, the House bill includes a strategy to advance sustainable aviation fuel production.
Rural Community Development and Investment
Supporting rural communities is a reoccurring theme throughout both the Senate and House bills. Through loan and grant support to rural businesses—extending beyond agricultural producers—the rural development programs supported by the farm bill facilitate investment in rural communities. These investments are considered broadly. When considered creatively, the rural development investments offer a broad array of opportunities for businesses of all sizes to expand the clean transportation economy. For example, with programs supported by the farm bill, small businesses could receive funding to support ZEVs in their fleet, clean transportation manufacturers could site production plants in rural communities, communities could make meaningful investments in transportation, and utilities could work with electric vehicle refueling providers to ensure the grid is able to support charging needs.
Next Steps
While the presidential election dominates the news cycle, a broad and bipartisan coalition of farmers, rural communities, and advocacy groups have come together to urge Congress to pass a farm bill in 2024. If passed, the farm bill will continue to provide critical support for programs that support a wide range of priorities — including clean transportation and renewable energy.
