At its core, the program incentivizes farmers to use precision irrigation methods, reducing methane emissions while increasing long-term incomes. Carbon credits, essentially permits that represent reduced greenhouse gas emissions, are generated when farmers switch to more sustainable practices. Given that rice accounts for more than 10% of global methane emissions, the potential impact is staggering. Industry experts suggest that if just 10% of rice farmers adopted drip irrigation, the emissions reduction would be equivalent to taking 40 million cars off the road.

carbon credits and agriculture—a fascinating intersection where environmental stewardship meets the fertile soil! Let’s dive right in!

What Are Carbon Credits?

Carbon credits are like eco-friendly currency. They’re created from carbon offsets, which are activities that prevent the emission of carbon dioxide (or other greenhouse gases) into the atmosphere. Imagine this: You decide to walk to the store instead of driving. That choice results in fewer carbon emissions. Now, picture yourself strolling up to a company or organization that wants to reduce its net emissions. You say, “Hey, I can save three pounds of carbon dioxide by walking to the store every day. Pay me fifty cents, and you’ll own those carbon savings!” That’s a carbon offset. Essentially, it’s easier for some organizations to pay others to reduce their carbon footprint than to do it themselves.

Cap and Trade System: The Nitty-Gritty

Under a cap and trade system, companies receive a certain number of carbon credits (kind of like carbon allowances). Each credit represents one ton of carbon dioxide. If a company emits less carbon dioxide than its credits allow (maybe by switching to electric vehicles), it can sell those excess credits to another company that needs more. It’s like a carbon marketplace where emissions are capped, but companies can trade these credits among themselves.

Now, here’s the twist: The United States doesn’t have a national cap on carbon emissions (yet!). However, California has its own state-wide cap-and-trade model, with greenhouse gas emission caps gradually decreasing over time. So, while we don’t have a nationwide system, some states are leading the way.

Agriculture’s Role: Soil Carbon Heroes

Guess what? There’s a lot of carbon hiding in our soils—almost three times as much as in the atmosphere! Soil is like Earth’s carbon vault. And agriculture? Well, it can play a superhero role. Certain practices—like regenerative agriculture—can move excess atmospheric carbon into the soil. Regenerative agriculture focuses on soil restoration, enhancing farm systems in the process. So, when farmers adopt these practices, they’re not just growing crops; they’re also sequestering carbon. 🌿

Farmers and Carbon Credits

Farmers and landowners can turn their carbon sequestration efforts into cash by participating in carbon credit programs. Here’s how it works: By implementing practices that reduce emissions or sequester carbon (think cover cropping, no-till farming, or agroforestry), they generate carbon credits. These credits can then be sold, providing new income opportunities. Plus, companies looking to offset their own emissions can purchase these credits. It’s a win-win! 🌾💰

Sources:

1. Agricultural carbon credits: An overview for farmers and landowners
2. What Are Carbon Credits For Farmers and How Do They Benefit Your Farm?
3. Carbon credits 101: How do they work in agriculture?
4. USDA Releases Assessment on Agriculture and Forestry in Carbon Markets
5. 1cropsandsoils.extension.wisc.edu2carboncredits.com3climatefarmers.org4agdaily.com5usda.gov

From pilot to global impact: Orbia’s journey to carbon credits

Tania Rabasa Kovacs, VP of Sustainability and Corporate Affairs, explains the launch of the program: “Orbia’s Precision Agriculture business Netafim has launched the world’s first carbon credit program for drip irrigated rice in 2022. The program aims to drastically reduce methane emissions from rice cultivation to near zero, while generating additional revenue for farmers in the long term.”

Italy, as Europe’s largest rice producer and a signatory to the global methane pledge, provided an ideal testing ground. Kovacs describes the process and results: “La Fagiana farm in Venice, Italy, was our first adopter in 2022. Since Italy is a signatory to the global methane pledge, it was a natural fit – and Italy is Europe’s largest producer of rice, particularly risotto rice.”

The results were impressive. “We monitored the farm for an entire season. It’s essential to have a full season of data to ensure accurate measurements,” Kovacs explains. “We found that drip irrigation technology in Italy yields more than rice while using 70% less water, 30% less fertilizer, and 36% less energy, while reducing methane emissions to almost zero.”

Building on this success, Orbia has expanded the program to more farms in Italy and extended its reach to other crops and countries, including Israel, India and Turkey. These programs are offered commercially once the growing seasons end and Orbia has accurate data on their positive environmental impact.

Overcoming obstacles: making sustainability accessible

Despite the clear benefits, adoption has its challenges. Kovacs acknowledges, “Making the investment to transition to sustainable practices is difficult for farmers, especially smallholders who lack resources and operate on tight margins.”

The program faces unique challenges, particularly in regions where water costs are not a consideration for farmers. Kovacs explains, “One of the biggest challenges for our rice program is that farmers typically do not pay for water, making it harder for them to see the business benefit in the first place. To address this, we work with local governments to encourage the transition to more efficient irrigation methods.”

Educating farmers about the extensive benefits

Orbia’s strategy goes beyond simply emphasizing water conservation. Kovacs emphasizes the multifaceted benefits of adopting drip irrigation: “There are many benefits to switching to drip irrigation beyond just reducing methane and water—from higher crop yields and improved soil health to reduced energy and fertilizer use. If it can be made more affordable for farmers through the carbon credit program, then the barrier to entry is lower.”

Navigating the carbon credit landscape

As carbon credits become increasingly popular in corporate sustainability strategies, Orbia’s experience offers valuable insights. Kovacs emphasizes the importance of rigorous verification: “Currently, the biggest challenge to widespread adoption of carbon credits is the lack of a standardized verification system and accreditation.”

Orbia is working with Regrow Ag for Measurement, Reporting and Verification (MRV). Kovacs explains: “We are working with them to measure and verify the environmental impact of traditional rice production methods compared to Orbia Netafim’s drip irrigation system. We then use the carbon offset verifier Verra to secure the carbon credits. We found their approach to farming to be the most accurate and scientific.”

Precision Farming: Orbia’s Vision for a Sustainable Future

To address the growing global demand for food in a sustainable way, Orbia invests in advanced agricultural technologies. The company has invested in startups such as Tortuga AgTech, Seetree and Greeneye Technology, which use innovative approaches such as harvesting robots, tree health monitoring and AI-driven precision chemical application.

Digital farming solutions are another key focus area, enabling real-time control and monitoring of farming activities. These technologies aim to make agriculture more sustainable, efficient and resilient in the face of climate change.

The Way Forward: Balancing Profit and Planet

As the agricultural sector faces increasing challenges from climate change and rising global demand for food, Orbia’s approach represents a growing trend in the industry. While the long-term impact of these initiatives remains to be seen, they highlight the potential for innovative solutions to address food security and environmental issues.

However, carbon credit programs have their critics. Some argue that they allow companies to keep polluting while compensating elsewhere. Others question whether such programs are viable in the long term to truly reduce global emissions.

As the global community grapples with these pressing issues, the ability of the agricultural sector to balance profitability with environmental stewardship will be critical. Orbia’s efforts, along with those of other industry players, can shape the future landscape of sustainable agriculture, but continued monitoring and refinement of these programs will be essential to ensure their continued effectiveness in the fight against climate change.