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Carbon Markets 101:

How Agriculture Players Can Reduce or Offset Carbon Emissions


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Anne Fairfield-sonn

Over time, human activities and industries have been increasing the atmospheric concentrations more quickly than natural activities. The good news is that there are solutions including carbon sequestions.

The United States Environmental Protection Agency (EPA) estimates that 10% of carbon dioxide, a primary greenhouse gas, is emitted by the agricultural sector. While this is relatively a small portion of overall carbon dioxide emissions by the economic sector, agriculture has received a lot of attention in reducing overall GHG emissions recently.

The agriculture industry is viewing carbon markets as an opportunity to attract additional revenue while adopting production practices to reduce greenhouse gas (GHG) emissions, improving soil health and yields, and potentially reducing input use. Various forms of carbon markets are being developed across the nation as companies attempt to reduce their own carbon footprint by offering payments to farmers to offset their own carbon emissions and to attract environmentally conscious consumers and investors.

Farmers can participate in this process by either reducing emissions or by capturing and storing emissions. To reduce emissions, producers could:

  • Decrease fertilization
  • Alter manure management
  • Reduce fuel consumption
  • Change feeding practices
  • Switch to alternative fuels, such as from coal to natural gas or bioenergy
  • Produce biofuels feedstock
  • Implement rotational grazing programs

Agriculturists can also capture and store emissions in a process called sequestration. One type of sequestration is biological sequestration, which uses the characteristics of plants to capture emissions. Agricultural forms of biological sequestration include:

  • Changes in tillage practices
  • Crop rotations
  • Conversion of acreage to grasslands
  • Afforestation, which is the planting of trees or seeds to change open land into forest or woodland.

However, these activities are costly, and producers must have an economic incentive to change their production practices to participate in the carbon market.

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