(The Center Square) – Almost 25% of North Dakota’s workforce is reliant upon the agriculture industry and government-mandated climate reporting frameworks have become “increasingly burdensome” for the private sector, according to a report on Environmental, Social and Governance.
The Bank of North Dakota generated the report for the North Dakota Energy Development and Transmission Committee.
The state has around 25,000 farms and ranches covering just under 40 million acres, according to the report.
ESG mandates on the agricultural industry could result in “significant” legal resistance, lawmakers were told.
The agriculture industry generates more than $35 billion in annual economic impact for the state. The private sector is burdened by the ESG mandates, according to the report.
The U.S. Securities and Exchange Commission adopted new rules in March to mandate climate-risk disclosures, which would mean additional financial costs for businesses. This led to multiple states and businesses suing the SEC. According to the report, the lawsuits are currently pending in the U.S. Eighth Court of Appeals.
“Navigating the existing complex regulatory and business ESG landscape while remaining competitive on a global scale requires a multifaceted approach for North Dakota’s agriculture sector. Any viable ESG initiative must first aim to safeguard our national food and energy security and minimize adverse impacts to producers and consumers,” the report said.
The report found that the energy and agriculture sectors comprise half of the state’s economy.
North Dakota was the second-largest energy producer in the U.S. as of 2022, the report said. The state exported 60% of its electric power in 2010, but this export has declined in recent years, which was partially attributed to growing energy demands.
The report recommended a “balanced approach” to energy, with continued use of fossil fuels. It also encouraged supporting the expansion of natural gas pipeline infrastructure.
“To meet both current and future energy needs effectively, it is important to leverage all of the state’s energy sources comprehensively. By maximizing the utilization of the state’s diverse energy portfolio, including clean and low-carbon sources of fossil fuels, renewables, and emerging technologies, North Dakota ensures a reliable and sustainable energy supply for its residents and continues to contribute positively to energy markets beyond its borders,” the report said.