Farmers can earn money selling carbon credits
By ROWENA PLETT
Officials of Farm Bureau and Kansas Farmers Union are promoting the selling of carbon credits by farmers as a way for them to earn extra income. Enrollment deadline is Sept. 15.
Agricultural carbon credits are based on the idea that carbon is stored in soil that is not disturbed, such as no-till cropland, new grass seedings, and native rangeland.
This stored carbon offsets the carbon dioxide that is released into the atmosphere through industrial plants and purportedly contributes to global warming.
The owners of these plants, designated as "emitters," can buy carbon credits from "providers" to offset their CO2 emissions until they can establish their own controls.
Carbon credits sold by farmers through Farm Bureau are pooled by AgraGate Climate Credits Corp., based in Des Moines, Iowa. Farmers Union also has a program to pool credits. They then are sold on the Chicago Climate Exchange, which was established in 2003 by 12 big businesses and the city of Chicago.
Farmers commit to a five-year contract on specific qualified acres and receive payments once or twice a year, based on the current market prices. At present, the price stands at approximately $5 per ton.
Steve Swaffar of Kansas Farm Bureau said the price could go as high as $15 if the government establishes carbon dioxide emission standards, thereby increasing the demand for carbon offsets.
The program is voluntary, but once a contract is signed, the terms are legally binding on all parties. Inspections and certification are required annually.
Eligible land and earning potential
No-till: Carbon credits are issued at the rate of .6 metric tons of carbon per acre annually to participants who commit to continuous conservation tillage on enrolled land from 2007 through 2012. Alfalfa or other hayed forage is considered as no-till.
The use of plows, cultivators, or disks is not allowed, although a no-till disk, subsoiler, or other knife-like implement may be used. At least two-thirds of the residue must be maintained.
Seeded grass stands: Carbon credits are earned at a rate of 1 metric ton per acre annually, even if enrolled in CRP. Grass stands seeded prior to Jan. 1, 1999, are not eligible.
Native rangeland: Grassland with a grazing plan may earn up to .52 tons per acre annually. Light to moderate stocking rates, sustainable livestock distribution, and wildlife management are required. No burning is allowed.
Forestry: Forested acres, planted or regenerated after 1990, can earn up to several tons of carbon credits annually if the trees are managed in a sustainable manner.
Methane offset: Methane captured and/or destroyed can earn tons of carbon credits. Animal waste systems, including anaerobic digesters and covered lagoons can be enrolled. Each ton of methane captured earns 21 tons of carbon credits.
The Natural Resources Conservation Service can assist farmers in managing their contracted acres.
After each calendar year, the earned credits are sold on the Exchange and the proceeds, less fees and escrow, are sent to the producer or landowner.
Swaffar estimated at an information meeting Feb. 4 in Marion that a 250-acre enrollment would net a return of more than $3,000 over the life of the contract.
"If you are already doing these practices, it would not be too difficult to do this," he said.
"If it's (CO2's contribution to global warming) is real, you're helping," said Donn Teske, president of Kansas Farmers Union. "If it's not, you're still making money off of something you're already doing."
Teske said 74,000 acres in Kansas are enrolled to date in the National Farmers Union carbon credits program.
Enrollment is simple. After obtaining a contract form, the participant signs it and specifies how many acres and what type of land is being committed. Copies of FSA maps and reports or CRP contracts are required to be submitted along with the signed contract.
For more information or to obtain an application form, contact Donn Teske at 620-241-6630 or Steve Swaffar at 785-234-4535. The contract form also may be downloaded at www.agragate.com.