US Cap & Trade Could Boost 'No-Till' Agriculture
Looking to revitalize their soil and lessen the release of carbon dioxide into the atmosphere a small but growing number of farmers around the U.S. are practicing “no-till” agriculture. The practice stands to get a substantial boost if the U.S. government establishes a national emissions cap-and-trade system, according to the Kansas Farm Bureau's director of natural resources Steve Swaffer.
The financial crisis and recession have pummeled so-called carbon prices on existing markets for carbon emissions credits, whether on voluntary markets such as that run by the CME's Chicago Climate Exchange or those mandated by government, such as the European Union's Emissions Trading Scheme, or ETS.
Even at these low levels, farmers and ranchers could still generate enough income to cover property taxes or pay for a vacation, however, Swaffer told a small group of farmers, ranchers and property owners at a recent meeting.
Boosting No-Til Farming, Reducing CO2 emissions
The market price could rise if the federal government passes a national emissions cap-and-trade bill, market-driven regulatory legislation that Pres. Obama, leading Democrats and Republicans have said they would push for but to date has been held back by internal debate and dissension over projected costs, effects on the economy and the relative merits of variants of a cap-and-trade as well as an outright carbon tax.
The release of CO2 from soils on agricultural land is estimated to account for around 12% of carbon dioxide emissions globally, but as much as 20% in the U.S., according to government studies. The standard practice of repeatedly tilling soils increases the amount of carbon dioxide released into the atmosphere. It also wears the soil out faster than the 'no till' alternative by speeding up the nutrient cycling process.
Studies show that practicing 'no till' agriculture allows soil to rejuvenate and reduces the amount of CO2 released into the atmosphere. "You're storing it in the soil and not releasing it," Swaffar said. "It's something you can't taste, touch or smell, but it's real."
Aggregating Agricultural Carbon Credits
More than 200 members of the Chicago Climate Exchange, including the likes of Cargill, IBM, Monsanto and Safeway Foods, are prospective buyers of carbon credits from farmers, according to Swaffar.
The recession and credit crisis has pushed CCX carbon credit prices down but farmers practicing 'no till' can qualify for credits, each worth $2 a year with each acre of 'no till' land in Saline County, Kansas worth about 0.6 of a credit, according to Swaffar.
The high cost of obtaining a CCX membership-- around $50,000—has kept individual farmers and ranchers out of the market to date. The Kansas Farm Bureau is looking to solve that problem by partnering with AgraGate Climate Credits of West Des Moines, a for-profit company established by the Iowa Farm Bureau, to originate and buy credits from farmers and ranchers and trade them on the CCX.
AgraGate has 260,000 acres of 'no-till' and 'strip-till' land under contract in 71 Kansas counties. The company paid out $4.2 million in carbon credit payments to farmers last year at an average price of $4.63 per credit, according to this report by The Salina Journal reporter Tim Unruh.