Specific Objectives of the Project

Develop a framework for modelling different regulatory approaches to controlling methane emissions from California’s dairy sector.

Summary of Results

We have developed a simulation model that allows for different regulatory schemes controlling short lived climate pollutants from dairies. A tax, an emissions standard and a cap and trade. The model simulates the associated costs of control and provides scenarios for leakage to other states.

Specific Objectives of the Project
This project estimated the empirical effects of historical temperature on dairy production and quality, specifically measured by volume, fat content and protein content. This estimation will be used to both forecast the expected costs to the dairy sector of future climate change, and estimate the historical cost of recent climate change.

Project Report/Summary of Results
Dairy is a crucial part of the California and United States' food systems. Milk is California's largest agricultural commodity by value, producing approximately $8 billion per year for farmers. Dairy constitutes 19% of the protein content of the US diet, provides half of the total calcium and vitamin D, and provides a quarter of the total vitamin A and vitamin B12. Globally, dairy is also very important, constituting 10% of total protein and 26% of the total protein consumed from all animal sources. It is the largest animal product globally both in terms of contribution to protein supply and calorie supply.

This project finds that the production response of California dairies to temperature is increasing up to 15-20°C, and more steeply decreasing thereafter. The model estimates that taking an hour at 15-20°C and moving it to 35-40°C would result in a reduction in production of approximately 30% (for that hour), a statistically significant reduction. The quality measures (fat proportion and solids-not-fat proportion) exhibit a significant negative relationship with temperature, across the temperature spectrum, that is economically small. The model estimates that the same temperature change would result in reductions of these proportions of less than 0.2% (not percentage points). These results allow researchers to confidently work with data on raw quantities of dairy production, which is much more readily available than the nutritional quality data.

This project also finds that predominantly pasture-based dairy systems respond to hot temperatures to a much larger degree than concentrated feeding operations. We find that the production response for pasture-based counties is increasing up to 10-15°C and decreasing thereafter. The model estimates that taking an hour at 10-15°C and moving it to 20-25°C would result in a reduction in production of approximately 60%, a much larger impact than that for Central Valley counties. The difference can be explained by a combination of differences in the ease of protection of the cows (fans and evaporative cooling cannot be employed in pasture-based systems) and differences in the proportion of feed grown locally.

A next step in this project is a careful accounting of the impacts on upstream feed production for the Central Valley farms. A simple projection of future climate change would naïvely omi omit these important effects. A working paper will be available in August.