by Stephen Wagner
Carbon credits and markets in Pennsylvania are often misunderstood. If the bulk of your knowledge about carbon comes from “Star Trek” and their search for carbon-based life forms, the following should be a refreshing primer. Dr. Siobhan Fathel, professor of Agricultural & Biological Engineering at Penn State, is said to have a knack for taking complex subjects and breaking them down into palatable pieces. “Can we think about carbon when we think about anaerobic digestion? The answer is yes,” said Fathel. “Where carbon is really viewed as a commodity, as something that you can sell, it offers an opportunity to mitigate climate issues and also provide cash for farmers. Carbon credits and markets are really misunderstood; it’s a catch-all phrase for a lot of practices and policies.
“Greenhouse gases like methane, nitrous oxide and water vapor have an effect on the environment where it really keeps us going. But if we release too many greenhouse gases, we can increase the temperatures and we have this negative climate effect,” Fathel explained.
Carbon dioxide isn’t the only thing that has to be considered in farming. There are other significant connections. One is enteric fermentation (cow flatulence). “This is what’s happening in the guts of dairy cows and cattle,” she said. “They’re releasing methane through their gas, and this is important. Why? Because there’s this multiplier for methane, so if you compare carbon dioxide (to methane), it’s a 1:36. Any time a methane molecule is released you’re getting a higher greenhouse effect.”
Another way of releasing greenhouse gases on the farm is through a manure management program. “We can store some carbon in the soil, ‘sequester’ it,” Fathel said. Think of photosynthesis. “In that process, plants take in light and carbon dioxide and they create sugars for themselves that contributes to plant growth,” she said. “It’s also moving some carbon into the soil. If the soil is undisturbed for a period of time, we can sequester and store carbon even after the plant dies.” The goal is either to reduce the size (release fewer greenhouse gases into the environment) or store more in the soil.
Pennsylvania farmers are smart about carbon farming; with no-till or cover crops, farmers make sure there are crops on the landscape year-round. Reducing the amount of disturbance is important. One way of doing cover crops is to plant perennial grasses. They do not have to be re-planted and the ground beneath them remains undisturbed.
“Good crop rotation, if you’re doing it right, can reduce the amount of nutrients you need to add to your landscape or to your field,” Fathel said. Which brings us to manure management – this can stem from low-cost, low-tech ways like composting where you’re making manure far more stable simply by composting it. There are high-tech ways – such as a digester where you’re putting that waste to work. Not only are you not allowing it to emit gases, you’re creating a byproduct, which is energy – a renewable bio-gas.
How can you profit from this? “The simple answer is carbon credit,” said Fathel. Carbon credits quantify sequestration which can then be traded for the “right” to emit greenhouse gases. “Companies can then buy this to offset their emissions. Essentially, they have the right to emit emissions by buying your credits, what you’re doing on your farm. Ideally, this circle ends when you get paid.”
There are two ways this happens. The first is compliance-based markets. These are well-structured and enforced by the government – a sort of cap and trade system. They pass the cap and buy some carbon offset to justify their greenhouse gas release. “This is not what we see, unfortunately, in Pennsylvania,” Fathel observed. “Instead, we have a voluntary market. Here companies are voluntarily purchasing carbon credits to offset their activities.” Fathel said this offers no enforcement. It’s less regulated, which is an important part of the equation.
To delve further into voluntary markets, attorney Brook Duer at the Center for Agricultural and Shale Law, chimed in. “Voluntary markets are what we have right now,” he said. “With the impending or creeping or advancing voluntary markets … the federal government recognizes that perhaps there needs to be some type of intervention in these voluntary markets, more like controls, but voluntary controls.” Congress addressed the Growing Climate Solutions Act of 2021 which was reported to the Senate in June of this year.
“This bill,” it reads, “authorizes the Department of Agriculture (USDA) to establish a voluntary Greenhouse Gas Technical Assistance Provider and Third-Party Verifier Certification Program to help reduce entry barriers into voluntary environmental credit markets for farmers, ranchers and private forest landowners. A voluntary environmental credit market is a market through which agriculture and forestry credits may be bought or sold. Entities eligible to participate in the program are (1) providers of technical assistance to farmers, ranchers or private forest landowners in carrying out sustainable land use management practices that prevent, reduce or mitigate greenhouse gas emissions, or sequester carbon; or (2) third-party verifiers that conduct the verification of the processes described in the protocols for voluntary environmental credit markets.”
“This is good,” said Duer, “because it gives us some statement of what is the level of thinking at the federal level as to what can be done in these voluntary market situations to try to assist land owners in being a little bit better prepared, a little better protected. The model for this act is essentially ‘Wild West’ because the voluntary markets are a sort of wild west scenario. There’s nobody regulating these markets, really; there’s simply no uniformity controls or predictability to any of this. It’s a completely private voluntary market. The contracts can be all over the place.”