Agricultural Carbon Markets: How Could They Work?

Drew Havens Author

07/30/2021 Added

7 Plays

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Summer 2021 UCARE

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[00:00:01.140]Hello. I am drew havens,
[00:00:02.820]studying environmental studies and natural resource and environmental economics
[00:00:06.690]here at the university of Nebraska Lincoln. This summer,
[00:00:10.350]I've been working on an extended literature review for my year long thesis
[00:00:14.160]project titled agricultural carbon markets. How could they work?
[00:00:18.300]And I would like to share what I found with you today
[00:00:23.840]in the world effort to limit the worst effects of climate change.
[00:00:27.290]A proposed solution is to incentivize soil carbon sequestration through
[00:00:31.280]voluntary carbon markets because United States is physically a large country and
[00:00:36.110]much of our land is an agricultural use.
[00:00:38.540]Significant potential exists for the sequence duration of carbon dioxide in our
[00:00:43.100]soils. The problem is this requires a change of practice by farmers,
[00:00:47.630]such as using no-till or cover crops.
[00:00:50.390]Sometimes the change in practice results in a decrease yield for the farmer or
[00:00:55.010]more time to spend in the field working.
[00:00:56.960]So monetary compensation helps to offset these potential losses or provide extra
[00:01:01.850]income to egg producers.
[00:01:05.030]Voluntary carbon markets have existed and failed in the past.
[00:01:08.780]So the objective of this research project is to identify what challenges these
[00:01:12.830]markets face and potential solutions.
[00:01:15.620]I feel this is an especially important issue as we continue to see the
[00:01:19.040]disastrous effects of climate change at alarming rate, and must take action to.
[00:01:23.600]Address the problem to begin.
[00:01:26.690]My literature review,
[00:01:27.830]I collected scholarly popular and informative articles about the subject and
[00:01:32.120]categories them by topic.
[00:01:34.130]I compiled them on a website I made and implemented a search feature to make my
[00:01:38.330]future research more efficient.
[00:01:40.430]The next part of my literature review was writing a report containing four
[00:01:44.840]important topics.
[00:01:46.160]How agricultural carbon offset payment programs work history of earlier programs
[00:01:50.750]for carbon offset payments to farmers,
[00:01:52.610]status of current programs and proposals for carbon offset payments and review
[00:01:56.990]of existing literature describing and evaluating carbon agricultural credit
[00:02:01.700]market.
[00:02:01.880]It's.
[00:02:04.190]The first section.
[00:02:05.060]My report explains what voluntary carbon offset markets are and to the economic
[00:02:09.560]reasons behind why they work.
[00:02:11.570]Essentially producers can implement a change of practice that results in a
[00:02:15.080]certain amount of carbon sequestered,
[00:02:17.210]then sell the credits to a carbon marketplace.
[00:02:20.090]Then consumers who desire reductions and the level of carbon dioxide in our
[00:02:24.200]atmosphere,
[00:02:25.190]but are unable or unwilling to make personal changes can buy the credits usually
[00:02:29.510]worth one ton of sequestered carbon dioxide.
[00:02:32.630]The result is a net negative amount of carbon in the atmosphere than there
[00:02:35.870]otherwise would be. Other methods of reducing emissions,
[00:02:39.020]such as carbon taxes and cap and trade are also effective,
[00:02:42.320]but voluntary markets have distinct advantages. First,
[00:02:46.190]they result in the least cost solutions to the negative externality of carbon
[00:02:49.970]emissions being implemented. First,
[00:02:52.160]they allow anyone to participate in the market and also lead to an
[00:02:56.750]increase in innovation of carbon sequestration. Overall,
[00:03:00.820]though multiple solutions will be required to solve the problem.
[00:03:04.150]And voluntary markets are just one tool in our.
[00:03:06.280]Toolbox.
[00:03:08.860]The next section covers the history of voluntary carbon markets and lessons.
[00:03:12.370]We can learn from them. For example,
[00:03:14.380]the Chicago climate exchange ran from 2003 to 2010,
[00:03:18.760]over the course of its operation, 680 million metric tons offsets were traded,
[00:03:24.100]but the financial crisis of 2008 ultimately caused demands dry up and the price
[00:03:29.050]of each credit to plummet the European union's emissions trading system
[00:03:33.910]is a voluntary carbon market that began in 2005. And it's still trading today,
[00:03:38.290]although it has been criticized for the verification of its credit.
[00:03:43.920]Presently,
[00:03:44.880]there are multiple carbon marketplaces that have just recently moved on or will
[00:03:48.420]soon begin trading credits. These include Nori, indigo agriculture,
[00:03:52.920]and Landolakes owned true Tara among others.
[00:03:55.980]Challenges to the survivability of these markets include the dynamics of
[00:04:00.780]supply and demand in the carbon offset economy. Verification methods of credits,
[00:04:05.610]data, privacy rights,
[00:04:07.290]and longevity of offsets innovation in the industry is lowering the cost of
[00:04:12.030]verification and making it more reliable,
[00:04:14.580]which is especially important because it is the step in the creation process
[00:04:18.510]that gets credit survey also demand for carbon offsets is higher than it was a
[00:04:23.220]decade ago due to increase education and awareness about.
[00:04:26.490]The climate crisis.
[00:04:29.520]The fine no section of my report,
[00:04:31.140]delves into the popular and scientific literature about voluntary agricultural
[00:04:35.370]carbon markets in popular articles,
[00:04:38.040]common themes include skepticism on the farmer's part and concerned about data
[00:04:42.510]you to utilization and verification methods in the scientific literature.
[00:04:47.610]Some questions that are left unanswered,
[00:04:49.680]such as the most cost-effective way to verify sequestered carbon and how best to
[00:04:54.330]find the equilibrium price and balance supply and demand in the voluntary
[00:04:58.530]market. Having answers to these questions would be beneficial to the industry.
[00:05:03.030]So I hope to answer some of them through future research in the fall,
[00:05:07.680]I will be conducting research on methods of measuring soil,
[00:05:10.560]organic carbon fluxes on a large scale and attempting to determine which methods
[00:05:14.760]are most feasible. Next spring,
[00:05:16.740]I will be synthesizing the results of the whole project and identifying the
[00:05:20.340]economic feasibility of carbon offset payments to farmers.
[00:05:23.700]There are still a lot I need to learn about the subject,
[00:05:26.010]but the summer has provided me with an excellent base from which to move
[00:05:29.490]forward.
[00:05:30.300]The main takeaway that I have so far is that voluntary carbon markets are an
[00:05:33.870]efficient and popular method of reducing atmosphere, carbon emissions.
[00:05:38.070]I think they're the most politically feasible as well.
[00:05:40.830]And as long as farmers are getting paid a fair price for the Seaquest duration
[00:05:44.190]efforts, the market is a win-win for everyone involved.
[00:05:49.230]I would like to think that you care program for providing funding for this
[00:05:52.170]research, as well as Dr. Richard Perrin and Dr. Lillian Fulton.
[00:05:56.430][inaudible] both faculty and the UNL YAG econ department for the
[00:06:01.310]support they've provided guidance and proofreading throughout the summer.
[00:06:05.240]And I will continue to work with them throughout the school year.
[00:06:08.540]Thank you for your time today.

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Agricultural Carbon Markets: How Could They Work?

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