Report: Climate reporting ‘increasingly burdensome’ for private sector

(The Center Square) – Nearly 25% of North Dakota’s workforce relies on agriculture, and mandatory climate reporting frameworks have become “increasingly burdensome” for the private sector, according to an environmental, social and governance report.

Bank of North Dakota prepared a report for the North Dakota Power Development and Transmission Committee.

There are about 25,000 farms and ranches in the state, covering just under 40 million acres, according to the report.

Lawmakers have been told that ESG mandates affecting the agriculture industry could result in “significant” legal resistance.

The agriculture sector generates more than $35 billion in annual economic impact to the state. The private sector is burdened with ESG mandates, according to the report.

The U.S. Securities and Exchange Commission adopted new rules in March requiring climate risk disclosures, which would impose additional financial costs on companies. That has led to lawsuits against the SEC from multiple states and companies. The lawsuits are currently pending in the U.S. Eighth Circuit Court of Appeals, according to the report.

“Navigating the complex regulatory and business ESG landscape while remaining globally competitive requires a multi-faceted approach for North Dakota’s agriculture sector. Any viable ESG initiative must first and foremost aim to protect our national food and energy security and minimize negative impacts on producers and consumers,” the report reads.

The report found that the energy and agriculture sectors make up half of the state’s economy.

North Dakota was the second-largest energy producer in the U.S. in 2022, according to the report. The state exported 60% of its electricity in 2010, but those exports have declined in recent years, partly attributed to rising energy demand.

The report recommended a “balanced approach” to energy, with continued use of fossil fuels. It also encouraged support for the expansion of gas pipeline infrastructure.

“To effectively meet current and future energy needs, it is important to comprehensively leverage all of the state’s energy sources. By making the most of the state’s diverse energy portfolio, including clean and low-emission fossil fuel sources, renewable energy sources, and emerging technologies, North Dakota provides a reliable and sustainable energy supply to its residents and continues to positively contribute to energy markets beyond its borders,” the report says.