Carbon Credits: Is it worth the switch to regenerative ag?

Farmers are the best at what they do, actively removing carbon from the atmosphere and doing it cheaper than anyone else. How can more people buy into this practice so researchers can quantify agriculture’s role in the carbon cycle into something meaningful?

Carbon catalyst program manager, Russell Booth with Indigo Ag encouraged producers at the annual Kansas Ag Research and Technology Association conference to make the switch to regenerative agriculture for profit incentives in addition to the benefit of running an eco-friendly operation using a carbon credit program.

Carbon credits, paid out from corporate partners, incentivize farmers to switch to regenerative ag practices. On the flip side, companies, known as the buyers, are incentivized to spend less on transportation by supporting local. In time, both parties work equally to reduce greenhouse gas emissions.

“This is built to match buyers to growers,” Booth said. “A buyer may want it to come down to location. They don’t want to be trucking grain from the Dakotas all the way over to [their] facility. So maybe they need something a little bit closer because that may directly impact their supply chain and they can say, ‘Hey, we’re actually being a good steward. I’m not emitting as much CO2’ and all that fun stuff that we’d like to talk about in a sustainable space.”

Reducing greenhouse gas emissions is the end goal on both sides of the spectrum. Using the registry-issued carbon credits system through Indigo Ag, farmers can be paid to switch to sustainable farming practices and cover crops to capture carbon in the atmosphere.

“The challenge is it costs money to measure and verify,” Booth said. “Ideally, when we go do this, we want to sample every single field. But that’s where management systems come into play.”

Indigo Ag is working to solve three main challenges the carbon system is facing. The cost to measure and verify carbon conversion, the lack of technology to guide a change to regenerative practices and finding an acceptable financial incentive for improving farming behaviors.

“Farming is here. It’s now. It’s something we’re doing year in and year out. If we can model it, quantify it, verify it and get the growers paid for it. Why not do it?” Booth said. “You’ve got to look at the bigger picture and say, we may not be able to solve all of it, but can it help make an impact?”

Through Indigo’s system, carbon sequestration can be proved to the buyer through soil sampling and documentation of cover crops used. If carbon sequestration cannot be proven, producers aren’t getting paid.

“What we’re learning is when we go to work for these verifiers, buyers want to know if their dollars invested actually made a change,” Booth said.

With higher data collection and monetary gain, accuracy can be improved. So long as data is being provided through a third-party source, buyers can remain confident dollars are going toward their intended farming practices.

“The unbiased approach is something that is a requirement for us to meet,” Booth said. “We can estimate emission reductions and uncertainty and calculate the credits. Our model also gives credit for abatement. What that means is a grower that may have been full tillage and reduced tillage isn’t taking as many passes. If he’s not taking as many passes, he’s not emitting as much and that gives him credit.”

Booth said if farmers can still feel competent with their operation and it puts an extra dollar in their pocket, why not do it? The system improves farm economics for a healthier planet and farming is done a little bit cleaner and greener.

“[We need to] demonstrate that the transition to regenerative practices increases soil organic carbon and nutrient concentrations, identify specific areas where regenerative practices are more profitable and can increase organic carbon and nutrient concentrations in the field,” Booth said. “The value to the grower is to generate increased returns by lowering input costs without incurring losses while improving on resiliency, water stress, pest pressure and time.”

Making the system attractive on more than just a money front is key to long-term success and change within the industry.

“We are making sure we’re putting the growers in a position to succeed with these regenerative practices, and not just saying, ‘Yeah, do it for the money,’” Booth said. “Again, we’ve got to be able to get some of this data back from the grower. The grower agrees on a minimum of three to five years, so they’re able to get us the data we need and transfer it in an acceptable manner.”

The idea is for corporate partners to pay out a premium per bushel on the number of regenerative practices used. Single farm scale can be increased over time for long-lasting carbon sequestration. To see the full program or get involved and learn more, Booth recommends visiting www.indigoag.com/carbon/progress.

“We’re not out there recommending like $80 an acre on cover crops,” Booth said. “We’re actually saying start slow and take this approach and do it slowly and more like $20 to $25 per acre, something like that.”