The Ups and Downs of Sheep Burps

Environmentally, there are two ways to look at sheep.

We can focus on what goes in and what comes out.

Solar Farm Sheep

It turns out that sheep are ideal for solar panel farms. Small, starved, and mild-mannered, the sheep have the right stature, appetite, and temperament. Rather like grazing lawn mowers, they minimize the surrounding foliage so nothing blocks the panels. By contrast cows and horses are too big while goats nibble on wires.

With vegetation management a top cost, solar farm owners say sheep are the least expensive solution. Meanwhile sheep farmers sound delighted. Receiving $300 to $500 an acre, sheepherder demand has soared. As for the environment, sheep appear to improve the soil while they replace fossil fuel fed lawn mowers.

But there is one problem. Sheep burps.

Sheep contribute to the methane emitted by ruminant livestock. Recognizing that sheep burps are a disproportionally large source of GHG, New Zealand has even proposed a tax on those emissions. With its 26 million sheep (and just five million people), New Zealand’s tax could make a difference.

Our Bottom Line: A Demand Determinant

Sometimes the position of a demand curve can depend on a second commodity. When that happens, economists say we have a determinant of demand that is a complement. So, I wonder if we can say that more solar panel production will lead to more sheep? It certainly is creating more sheepherders.

Then we would see both curves shift to the right and maybe, the price of sheep for grazing and sheepherder revenue would rise.

Returning to our title, the upside of a sheep burp is how it helped a solar farm. But the downside is the methane.

My sources and more: Thanks to WSJ for alerting me to solar farm sheep. From there, the Bay Journal had more detail. Then, completing the story, this journal explained New Zealand’s tax proposals.