A 6-step guide for farmers to get carbon credits in agriculture

When finding new ways to make the farm profitable, generating agricultural carbon credits is swiftly becoming the sustainable solution many farmers look for. It isn’t surprising considering soil carbon farming increases the organic matter content in the soil, optimizes production costs, and expands income from selling carbon credits as well as gaining access to better economic incentives from banks or financial providers.

There are many ways a farmer can leverage carbon credits in agriculture. With upcoming regulations and growing demand from businesses to purchase carbon credits from farmers, it’s becoming clear why the shift to carbon farming is the future of agriculture. What can be confusing though is the information surrounding carbon farming credits.

This article is filled with practical information on how to get carbon credits in agriculture. Follow along with 6 simple steps as we break down key information to obtain carbon credits for your farm.

What are carbon credits for farmers?

It’s worth asking the basics before diving in deeper. Carbon credits is the talk of the town and the chatter around it can be confusing. Simply, it’s defined as:

Carbon credits: Represents successful emission reductions through practices that enable the removal of carbon in the atmosphere. Carbon credits in agriculture require practice changes that limit farm emissions or store carbon in the fields or both.

On specifications, these are the qualities of carbon credits:

• One carbon credit corresponds to one metric ton of carbon dioxide.

• Genuine carbon credits are generated with careful measurement, reporting, and verification (MRV) procedures.

Once carbon credits are generated, carbon credit producers can sell them to buyers looking to offset their emissions, usually to businesses or even individuals. Carbon credits are traded at carbon markets for sellers and buyers.

How do farmers get carbon credits?

Carbon credits are produced from different methods and industries. For carbon credits in agriculture, it can be generated from any of these five sources:

• Managing peatlands

• Agroforestry

• Maintain and enhance soil organic carbon on mineral soils

• Livestock and manure management

• Nutrient management on cropland and grasslands

For crop producers, in particular, credits are generated by shifting to carbon farming practices that enhance soil health and contribute to climate change mitigation by storing carbon in the soils.

However, adopting carbon farming practices is just one step in the process to generate carbon credits in agriculture. This guide outlines general procedures for land managers to follow to produce tradable carbon credits for income.

6 steps to generate carbon credits in agriculture for income

The steps listed below vary from one carbon program to another. There could be more or less depending on requirements, and the ones below are generally true for most programs.

1. Begin by finding the right carbon program

Carbon farming takes commitment and engagement with the right partner from the start can impact the success of the endeavor. A good place to start is to connect with a carbon program provider that can guide you through with the right tools, expertise, and support.

The right voluntary carbon credit program encourages farmers to implement certain agronomic practices designed to improve soil health, reduce greenhouse gas emissions, and/or enhance soil carbon sequestration. This should be collaborative, taking into consideration that each farm is unique and doesn’t just default to rigid guidelines applied to all participating farms regardless of individual conditions.

This stage is usually kicked-off with initial consultations to manage results and expectations. Once the farmer and the carbon program provider agree to the terms, the carbon credit program provider oversees the next steps hereafter to guide the farmer accordingly.

The eAgronom Carbon Programme is the only carbon farming manager that offers payments at the start of the carbon program to help farmers manage outcomes and profits at an early stage. Talk to us about carbon credits prepayments.

2. Conducting an initial assessment of the farm

Carbon farming is a science-based approach to agriculture that deals with measurements and understanding data to get to know how change can be implemented best with verifiable results. As a nature-based solution to climate change, it is imperative to generate credits based on robust assessment. Different measurements are conducted at different stages of the engagement, but it is typically done at the start by gathering baseline information to understand the current condition of the farm.

Gathering initial data on a farm can include the following:

• 3-5 years of historical farm data about crops grown, farm practices, yields, diesel usage, rate of fertilizer application, etc.

• Soil sampling

Setting the baseline for the farm is important because it guides what carbon farming practices are appropriate for the farm as well as measuring progress to properly account for carbon credits.

3. Designing a carbon farming practice plan

Upon assessment, the carbon program will recommend a set of agronomic practices which will enable the farmer to improve soil health, reduce greenhouse gas emissions, and enhance soil carbon sequestration, which subsequently leads to the generation of carbon credits.

All farms are different and should have a custom carbon farming practice plan based on their baseline assessment and goals. Expert agronomists will guide the crop producers on how to implement carbon practices.

Here are 10 examples of carbon farming methods to implement in the field.

• Reduced fertilizer application

• Reduced tillage

• Improved residue management

• Eliminating bare fallows

• Increased production of cover crops

• Sowing companion crops

• Agroforestry

• Improved task efficiency

• Improved water management

• Fuel-use efficiency

→ Read more about the 10 best carbon farming practices for soil health and income

4. Applying practice changes on the farm and recording data

After setting the guidelines and practices to implement on the farm to achieve carbon credits, the next step is for the land manager to carry out the plan in the fields. Each carbon farming practice will have different requirements and will depend on actual conditions.

It’s worth highlighting how important proper data-keeping and tracking is at this stage. The aim is to achieve results through practice changes. And having measurable information guides in understanding how each practice contributed to successfully generating carbon credits. Or perhaps, when it’s not working as originally planned, it’s good to have data to review the practices that need to be amended or improved.

MRV or measurement, reporting, and verification are vital in generating carbon credits. Recording data can be tedious. But without it, it will be hard to tell if there’s real carbon reduction or removal that happened.

The eAgronom Carbon Programme provides an MRV system for the farmer to support farm management and track the progress of the practice changes. It’s easy-to-use software which can be combined with other technologies such as remote sensing for a more robust data collection.

5. Verifying the results

This step makes sense of all the data gathered from practice changes applied on the farm to determine how it developed since setting the baseline data at the start. Calculations can include the amount of total CO2 removals or reductions generated by the farm.

The process of checking and verifying the farmer’s data can be conducted by the carbon program provider or an independent verification body.

→ What makes a true-high quality carbon credit? Read more about it here.

6. Earn certified carbon credits in agriculture

Following verification comes the issuance of carbon credits. Carbon credits are traded in a carbon market where buyers actively look for high-impact projects to complete their own emission reduction goals. Successfully trading carbon credits in agriculture results in a new revenue stream for farmers.

It’s worth noting that the prices of carbon credits change, and at the moment, they can trade anywhere between $10-90. The carbon credit market is expected to grow to reach a total value of up to $1.7billion at the end of 2022.

→ Read more about the different types of carbon markets

Start carbon farming today

In summary, these are 6 essential steps to create carbon credits for farming:

• Connect with a carbon program

• Initial farm assessment

• Creating a carbon farming practice plan

• Implementation and recording of data

• Verification

• Earning from carbon credits

Apart from carbon credits, there are many ways farmers can leverage carbon farming to their advantage. And it goes without saying that successfully generating high-quality carbon credits in agriculture needs commitment. Finding the right carbon program can provide the needed tools and guidance throughout the process.

From expert agronomic advice when creating the practice plan and during implementation, to providing tools such as an MRV system to make verification more robust. These are just some of the most important ways farmers can be supported in their transition to sustainable farming. Providing access to payments at the start of the engagement is also a key factor in making carbon farming more manageable for farmers.