Key Factor #8: Soil Carbon Market Operating

The first trade in Australian soil carbon offsets took place on 6 March, 2007, when the an executive from a restaurant chain purchased a ‘subscription’ of 2 tonnes CO2e/month from Carbon Farmers of Australia.

The transaction took place on a website called Adopta Farmer Fighting Greenhouse (www.adoptafarmer.com.au). It was set up as a test marketing exercise by the Carbon Coalition Against Global Warming, an activist group seeking to win for farmers the right to trade the value of the carbon they can grow in their soils.

Several other committed individuals found the site – it was not publicised – and became ‘sponsors’ of the Coalition upon learning of its work. Their financial support takes the form of subscription.

The trading activity served other purposes besides testing the water for demand of “gourmet carbon” (non-commoditised voluntary market transaction that are linked to and derive brand values from a cause). It helped Coalition members start the process of learning about the carbon trade bythe ‘learning-by-doing’ method commonly used in the carbon trading and climate change spheres.

It also changed the nature of our relationship with our supporters, government agencies and the soil science community. No longer did we have to wait for official approval for the market to operate. Believing that a free enterprise system is based on the right of two individuals to freely enter into an arrangement by which value passes to one party for consideration (the buyer being protected by the law of contract and the power of bad publicity).

And we had defied those who said there would never be a Market in soil carbon. The Market had spoken.

Our buyers were attracted by the soil carbon vision: that by encouraging farmers to manage for soil carbon they were restoring farmland biodiversity and restoring ecological health to degraded soils while at the same tme they were helping to preserve family farming. We designed a graphic that showed the relationship between their money and the triple bottom line benefits.

To assure us of supply, we started recruiting carbon farmers and, to facilitate this, established Carbon Farmers of Australia as a not-for-profit, with all profits going towards creating demand so members can sell their carbon. Simultaneously we market tested a recruitment drive and established www.carbonfarmersofaustralia.com.au as a recruitment device. We promoted it on the Carbon Coalition’s popular blogsite http://carboncoalitionoz.blogspot.com and have attracted 25 or more farmers who fit the job description: practicing Carbon Farmers who are committed to soil and landscape regeneration and additional revenue in equal amounts.

The Carbon Farmers of Australia contract and handbook had to be developed. In the course of this process, we confronted the issue of Monitoring and Verification.

Our solution was an evolving MMV model that grew as our capability developed:

Stage 1: An imputed value model (based on CCX system), value based on benchmarks from available sources.

Stage 2: An imputed value model, audited by a credible third party, based on a series of dimensions which can be measured visually and includes some degree of “baseline measurement of soil carbon”

Stage 3: A direct measurement model which involves analysing core samples based on a MMV methodology that is cost effective and based on tolerances acceptable to the corporate market.

Stage 1 Model

Our Stage 1 offering of “Provisional Carbon Credits” was transparent and carefully expressed on the website:

“

The CARBON FARMERS OF AUSTRALIA SOIL CREDIT is based on the following indicators:


1. The history of soil management for the plot in question.
2. 
The history of soil management for the entire property.

3. The training record of the land manager.
4. 
The land management techniques used on the entire property.

5. The imputed increase in soil carbon in the plot in question over the period since the change in land management.

6. Membership of Carbon•Farmers™ Of Australia, a group of conservation land managers who are also actively working to restore the natural resource base.


NB. When the politicians and scientists finally catch on to the danger we are facing and the need for soil carbon credits, we will have a new system that accurately measures out the Carbon 'sequestered'. But we can't afford to wait for them. In the words of Professor Stuart Hill, UWS, "If you get tangled up in measurement you will sink into a quagmire and never achieve your goal."



"PROVISIONAL CARBON CREDITS" - HOW THEY WORK


CARBON FARMERS OF AUSTRALIA SOIL CREDITS are Provisional Carbon Credits. This is your guarantee that you are getting what you pay for. They are set at a very conservative rate of 2 tonne CO2e per hectare per year where land management has changed since 1990: 

• from till to no till (ploughing to no ploughing)
• from till to pasture
• from set stocking to grazing management



These categories are based on estimates published by authorities such as the Australian Greenhouse Office: "The review clearly indicated that the introduction of a cropping phase into uncleared land or a well-established pasture with high plant biomass, reduced soil carbon density by 10 to 30 t/ha in soils to 30 cm depth... Likely changes in soil carbon densities associated with changes in soil tillage practices are of the order of 5 to 10 t/ha when they occur..." (Australian Greenhouse Office, National Carbon Accounting System, Technical Report No. 43, January 2005)

And the work of leading CSIRO soil scientists Roger Swift and Jan Skjemstad: “…it is suggested that a sequestration rate in the of about 2 Mt C pa is within the realms of possibility… Ideally the carbon levels can be restored to the same values that were supported the soils in their virgin state under native vegetation. In some instances the soils may be capable of sustaining higher organic matter levels than in their virgin state... Let us assume that half of the total amount of carbon lost from these soils can be recovered over a twenty year period and that in any one year one third of the 45 M ha is in a recovery or organic matter build-up mode. On this basis...the annual rate of sequestration of carbon by agricultural soils would be in the region of 4.4 Mt C pa. A more conservative target of 2.2 Mt C pa based on the treatment of 7.5 M ha pa ... could well be achieved. “- Roger Swift and Jan Skjemstad, “Agricultural Soils as Potential Sinks for Carbon”, CSIRO Land and Water for the CSIRO Biosphere Working Group, http://www.dar.csiro.au/csiro_reserved/BWG/agricultural_soils.htm

Our estimates are also informed by K.Y. Chan’s work on soil carbon levels under different land management methods in NSW which revealed that soil carbon levels were 2 to 2.7 times higher in pasture soil than in cropped soils, and up to 2.4 times higher in minimum till than in conventional tillage soils. (Chan, K.Y. “Soil particulate organic carbon under different land use and management,” Soil Use and Management (2001) 17, 217-221.)


Once the science provides us with a verifiable measurement approach, the surface area will be rescaled to meet the amount 'measured' in the soil below. 

Provisional Carbon Credits allows the Soil Storage of CO2 to start!
………………………WEB COPY.ENDS


We started with the proposition that a farmer in the Central West Catchment who changed land management techniques and was a practicing ‘Carbon Farmer’ could easily sequester 0.55tC/ha/year or 2 tonnes of CO2e per hectare per year. We chose that figure based on input from the following sources:

• Dr Christine Jones, Carbon For Life, a botanist and agronomist who has pioneered carbon sequestration in Australia, bringing together practitioners and specialists in a series of Carbon Forums across the nation.

• Members of the 10 farm families selected for the first “Farming Systems” Program conducted by the Central West Catchment Management Authority. Those selected were considered the most innovative in the Catchment, having introduced some significant deviations from the norm The focus of the program was salination and soil health. (Members included Colin Seis, David Marsh, Rick Maurice, Angus Maurice, all of whom became members of the Advisory Council of the Carbon Coalition Against Global Warming.)

• A Literature Search of Australian soil science papers.

• Meetings with leading international figures such as Michael Walsh, Senior Vice President, Chicago Climate Exchange (the first to trade in soil carbon offsets), and Dr Rattan Lal (Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food, Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award, World Congress of Soil Science 2006; President, American Soil Science Society)., and Professor Bruce McCarl, Agricultural Economist and Economist, Climate Change, Texas A&M University; Member of the Intergovernmental Panel on Climate Change.


Under Stage 1, buyers can come and stay with the farmer, watch “their” hectares develop, and learn about carbon farming.

Stage 2 model: Performance Dimensions for Audit by Third Party

We worked with Central West Catchment Management Authority Soils Officer John Lawrie to develop a standard audit regime for Stage 2.

The following has been proposed:

Audit based on 5 “Indicators” or proxies:

• increase groundcover and therefore biomass
• increase perenniality & therefore produce more biomass
• increase biodiversity of plants species and wildlife in and on the soil
• reduce soil disturbance and compaction
• balance soil nutrition

Indicators can be used because they are all known to be related to increases in soil carbon – whether in a direct causal relationship or a complex self-reinforcing looped system.

The first four indicators can be audited visually by members of the CMA staff or any third party certification service.

Additionally we will require the following:

• Farm Plan with soils map
• Soil tests of major nutrients, pH and carbon
• Proposed Management plan for 5 years

As soil carbon sequestration is based on climate, soil type, and land management, some provision has been made for climate in the form of a variable based on soil survey data.

• Tablelands 2.5% OC in top 10 cm = 0.75 tonnes Carbon/ha/yr

• Slopes 1.7% OC in top 10 cm = 0.50 tonnes Carbon/ha/yr

• Plains 0.8% OC in top 10 cm = 0.25 tonnes Carbon/ha/yr

Payments will be made on the basis of these estimates

Towards an Australian Voluntary Standard

Carbon Farmers of Australia is committed to developing an auditable Standard acceptable to Voluntary customers in Australia.

As the “Australian Voluntary Soil Carbon Sequestration Standard” develops, we will seek to register the methodology with the World Voluntary Carbon Standard, the world’s premier Standard for the Voluntary market.

We have made an agreement with the National Association of Sustainable Agriculture in Australia (NASAA) to co-develop the Standard. NASAA will thereafter certify and audit our growers.

Carbon Farmers of Australia will build on the knowledge and experience of NASAA in developing the Organic Certification Standard to develop the Australian Voluntary Soil Carbon Sequestration Standard. The following elements will form the basis of the Standard.

This Standard will comprise four sections:

• “General Principles” behind the architecture of Carbon Farming

• “Recommendations” which should be put into place where appropriate.

• “Standards” or the minimum requirements which must be met.

• “Derogations” represent possible exceptions to a standard and the specific conditions under which they may be authorised.

The Standard will also outline the practices and materials that are allowed, restricted or prohibited for use in order to be certified by NASAA as a Carbon Farmer. It will define the minimum conditions for certification under the Australian Carbon Farmers Trading scheme.

The Standard will be subject to continuous upgrading and amendment as knowledge increases and the market matures.

Collaborations with International Partners

Carbon Farmers of Australia has developed relationships with like minded people in three countries:

USA: The Carbon Coalition has a close relationship with the Carbon Farmers of America, which it helped form in October, 2006 in Vermont, USA. Carbon Farmers of America will be the beneficiaries of the work on Voluntary Standards in Australia.

NZ: Carbon Farmers of Australia has formed a working partnership delegates to the Carbon Farming Expo & Conference from New Zealand establish Carbon farmers of New Zealand and leverage knowledge gathered in Australia. The two groups are responding to a request from the NZ Ministry for Agriculture and Forestry for proposals on the following:

VOLUNTARY CARBON MARKET OPPORTUNITIES – SOIL CARBON MANAGEMENT IN NEW ZEALAND

1.1. To develop a cost-effective and practical system that allows those undertaking cropland management and grazing land management activities to estimate/measure soil carbon changes on their land and sell voluntary carbon market offsets.

India: CFA is mentoring interests in India in particular the Society for the Improvement of Public Life & Environment as they establish Carbon Farmers of India.

Stage 3 Model – Full Value/Direct Measurement MMV

The arrival of a robust model that measures soil carbon as accurately as is required to satisfy buyers.

The emergence of a system such as Dr Christine Jones’s Australian Soil Carbon Accreditation Scheme would give members of Carbon Farmers of Australia the opportunity to increase their involvement in carbon farming.

There will be different standards and requirements for such a system.

Carbon Farmers of Australia is developing a methodology which uses the ‘statistical properties’ of flux to equalize it across a single plot, farm, district, etc.


FOOTNOTES:

41.Formed in 1986, the National Association for Sustainable Agriculture, Australia (NASAA) is Australia’s leading national organic certifier. Through its role as a certifier, NASAA is committed to developing and maintaining
standards; assisting operators in gaining certification; and conducting ongoing
compliance supervision and inspection of certified operations. In addition to its national accreditation from the Australian Quarantine Inspection Service (AQIS) NASAA was the first Australian certification body to achieve accreditation through IFOAM (International Federation of Organic Agricultural Movements), and was the first to receive ISO65 (International Standards Organisation) status under the newly developed IFOAM/IOAS program

42. The world’s first Carbon Farming Expo & Conference (Mudgee, November 16th-17th, 2007) was organised by the Carbon Coalition, the Central West and Lachlan CMAs, and the Australian Soil Science Society and attended by 400 delegates from all States of Australia and New Zealand.