Credit Generator – Carbon Dioxide Sink
Credit Generator – Carbon Dioxide Sink

The credit generator removes carbon dioxide (CO2) from the atmosphere or prevents carbon dioxide from entering the atmosphere.
A Credit Generator could be a farmer or green energy producer.

The credit generator removes carbon dioxide (CO2) from the atmosphere or prevents carbon dioxide from entering the atmosphere.
A Credit Generator could be a farmer or green energy producer.

For example, harvest, tillage, and cover crop conservation practice data would be gathered by a farmer.
For a farmer, implementing conservation practices such as reduced tillage or cover cropping sequesters carbon dioxide in the soil. Data proving a practice change (ex: harvest, tillage pass, fertility, cover crop planting date) allows that farmer to turn that trapped carbon dioxide into a carbon credit.

$ is exchanged for metric tons of carbon captured, while data is supplied to prove the change.
Credit Aggregator – Carbon Credit Marketer
Credit Aggregator – Carbon Credit Marketer

The credit aggregator manages large scale (regional, nationwide, international) carbon projects. They either source carbon credit buyers directly or provide a platform for growers to sell carbon credits on their own. Farmers provide data to the aggregator and the aggregator provides money for credits back to the farmer.
Data goes in, money comes out.

The credit aggregator manages large scale (regional, nationwide, international) carbon projects. They either source carbon credit buyers directly or provide a platform for growers to sell carbon credits on their own. Farmers provide data to the aggregator and the aggregator provides money for credits back to the farmer.
Data goes in, money comes out.

Data from the farmer turns into carbon credit.

$ is exchanged for metric tons of carbon captured, while data is supplied to prove the change.

Carbon registries set the standards of what is acceptable to create a carbon credit. The aggregator reports to the carbon registry. In general, the registries require any models utilized by the carbon aggregator to be 90% correct 90% of the time.
Credit Buyer – Carbon Dioxide Source
Credit Buyer – Carbon Dioxide Source

The credit buyer purchases carbon credits to offset carbon dioxide emissions.

The credit buyer purchases carbon credits to offset carbon dioxide emissions.

Money for carbon credits goes in,

data in the form of verification of carbon captured comes out.

The credit aggregator verifies the carbon was captured through data verifying practice changes, satellite imagery, and soil sampling a subset of enrolled fields.
Carbon Market – Inset Programs
Carbon Market – Inset Programs

The credit buyer is within the agricultural value chain. For example, the buyer could be an agricultural input provider or an end user of grain.

The credit buyer is within the agricultural value chain. For example, the buyer could be an agricultural input provider or an end user of grain.

For example, certain programs may incentivize adding a winter wheat crop to increase crop diversity and keep living roots in the soil during the winter.

A beer company then purchases that wheat. The credit buyer is WITHIN the agricultural value chain.

The contracts are often shorter than those used for offset programs and last from 1-5 years.
Carbon Market – Offset Programs
Carbon Market – Offset Programs

The credit buyer is outside the agricultural value chain.

The credit buyer is outside the agricultural value chain.

For example, a clothing factory making polyester t-shirts produces subscript CO2 emissions.

They purchase an agricultural carbon credit to offset their emissions. The credit buyer is OUTSIDE the agricultural value chain.

Buyers require sequestered carbon dioxide to be both permanent and additional . The contracts are often longer than inset programs and typically last between 5-10 years.
Ecosystem Service Market
Ecosystem Service Market

Ecosystem Service Market
Many of the same conservation practices that capture carbon also improve water quality, reduce sediment erosion, and can improve biodiverisity and wildlife habitat.

Ecosystem Service Market
Many of the same conservation practices that capture carbon also improve water quality, reduce sediment erosion, and can improve biodiverisity and wildlife habitat.

Currently, the most common agricultural ecosystem service markets generate credits for carbon + water quality (N+P runoff reductions).

Because these markets also include a water quality credit payment, they generally result in higher total per acre payments for the farmer.
Ecosystem Service Market Credit Buyers
Ecosystem Service Market Credit Buyers

Entities that would purchase these credits are often government funded, usually through water treatment districts or the USDA.

Entities that would purchase these credits are often government funded, usually through water treatment districts or the USDA.

For example, Soil & Water Outcomes Fund is an ecosystem service market that generates carbon and water quality credits.

$ is exchanged for metric tons of carbon dioxide captured along with water conservation practices, while data is supplied to prove the change.
