AGRICULTURAL SOIL CARBON SEQUESTRATION VERIFICATION

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AGRICULTURAL SOIL CARBON SEQUESTRATION
VERIFICATION

• SWCS, Show-Me Chapter of Missouri
• Jefferson City, Missouri
• Fall Forum
• October 29, 2008

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SES Verification

• SES is a natural resources and environmental
  consulting firm
• Core business is providing consulting services to
  the agribusiness community
• Based in Merriam, Kansas
• Verifying acres for Chicago Climate Exchange
  (CCX) since 2003
• Verified close to 400,000 acres, primarily in 10
  Midwestern and Great Plains States

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Purpose

• Verification serves as the fundamental basis to
  secure information about contracted agricultural
  practices that result in carbon sequestration,
  and assurance that these practices are being
  followed.
• Verification is integral to the validity of
  carbon equity trading and the financial
  transactions between providers and purchasers of
  equity credits.

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Cropland Practices to be Verified

• Acres have to be considered croppable by the
  Farm Service Agency (FSA)
• Minimum tillage Credit of 0.6 ton/ac/year
• No-till
• Strip-till
• Not ridge-till
• Conversion of cropland to permanent grass Credit
  of 1.0 ton/ac/year
• Conservation reserve program (CRP)
• Farmers own conversion because of forage or
  other needs

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Minimum Tillage

• Must not disturb more than 30 percent of the row
  width
• Eligible implements No-till planter or drill,
  rolling harrows, subsoil ripper with at least
  24-in spacing, anhydrous ammonia applicator, low
  disturbance manure injector
• Ineligible implements Moldboard plow, chisel
  plow, offset disk, tandem disk, field cultivator

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Cropland Conversion to Grassland

• Had to be croppable acres
• Permanent pasture or rangeland is not eligible
• Had to be seeded after January 1, 1999
• Must show paperwork of seeding date
• CRP contract
• FSA-578 form
• Seeding dates on NRCS seeding plan
• Farmers seeding records or receipts

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Verification Process

• Randomly select 10 percent of the acres from an
  aggregators pool of contracts annually.
• Not feasible to field verify every acre every
  year.
• Aggregator sends SES a spreadsheet randomly
  select from this list.
• Typically choose 12 to 13 percent of the acres
  for a cushion in case of missing paperwork or
  access issues to fields.

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Verification Paperwork from Aggregator

• Signed contract
• Contact information for farmer
• Enrollment worksheet
• FSA maps showing enrolled fields with acreage
• FSA-578 forms
• CRP contracts

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Field Verification

• All field verification (and general premise of
  program) is practice-based or management-based.
  In other words the verification is based on
  visual observations of management practices.
• No soil sampling or other direct measurements are
  involved. This would be cost-prohibitive.
• Management-based verification /acre
• Soil sampling /acre

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Field Verification (Continued)

• Ensure we have all necessary paperwork from
  aggregator
• Contact the farmer ahead of time
• This is a courtesy call
• Farmer does not have to be present, but can ride
  around with us if he wants to
• Attempt to visit every enrolled field

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Field Verification (Continued)

• Confirm acreage by comparing FSA maps to visual
  observations in the field
• Confirm crop type
• Assess evidence of tillage practices
• Look for old residue
• Look for indicators of soil disturbance
• Collect GPS reading of point-of-entry to the
  field
• Collect digital photograph of overview of field
  and close-up of soil surface conditions (if
  necessary)

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Verification Timing

• Majority is done in the spring
• (April 1-June 30) around planting season
• Allows easier view of entire fields
• Easier access to fields
• Timing matches opportunity for farmer to till
  fields
• Lesser amount done in fall after harvest

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Verification Report

• SES prepares a verification report for each
  aggregators pool of contracts
• Verification report sections
• Introduction
• Methodology
• Summary which includes a summary table and a
  discussion of all contracts with discrepancies
• Conclusions
• Summary spreadsheet

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Verification Report (Continued)

• Verification Summary Table
• Total no-till and grass acres field verified
• Total and percent of no-till and grass acres
  meeting program requirements
• Total and percent of no-till and grass acres not
  meeting program requirements
• Contract specific discrepancies The report notes
  specific fields and acreage that had anomalies
  (e.g., tillage).

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Overall Program Performance

• Conformance rates for no-till have typically been
  95 to 100 percent, with a mean of about 98
  percent.
• Conformance rates for grassland conversion have
  been more variable and slightly lower at 75 to
  100 percent, with a mean of about 90 percent.
• Conformance rates for grassland conversion
  usually are lower in the early pools of contracts
  because of confusion about land eligibility.

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Common Non-Conformance Issues for No-Till

• Tilled end rows because of compaction
• Tillage to fix storm event damage
• Often these two types of tillage account for less
  than 3 of a field which Aggregator considers De
  Minimus
• Tillage to fix rutting caused by wet conditions
  at harvest or from manure applications
• Tillage necessary because of compaction or
  rutting caused by cattle grazing stalks
• Tillage necessitated because of change in
  cropping practices (e.g., corn after corn)

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Common Interpretation Issues for No-Till

• Eligibility of specific implements Must not
  disturb more than 30 of the row-width. If in
  doubt, take a picture of field and send to
  Aggregator.
• Ridge-till is not allowed
• Continuous low-residue crops (e.g., soybeans or
  cotton) are not allowed
• Biomass removal of annual crops (e.g., corn
  silage, burning wheat stubble) is not allowed.
  Only lose that years credit.

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Common Interpretation Issues for No-Till
(Continued)

• Fallow acres. Fallow is defined as at least a
  12-month period without a crop sometimes
  difficult to interpret with winter wheat and a
  row crop in a rotation. Would not receive
  credits for that year that field is fallowed or
  a prevented planting situation (flooding).
• Alfalfa hay Although a perennial crop, receives
  a no-till credit because most stands only last
  4-6 years.

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Common Non-Conformance Issues for Grassland
Conversion

• Acres were seeded prior to 1999
• Can still be confusing when examining CRP
  contracts regarding exact seeding dates and land
  use prior to CRP contract.
• Acres were in permanent pasture, never farmed
  therefore, not considered croppable

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Common Interpretation Issues for Grassland
Conversion

• Alfalfa/grass mix 50 grass considered grass
  credit 50 alfalfa considered no-till credit
• Re-seeding or renovating old CRP or pasture
  Since it was already in grass, not eligible for
  grass credit.
• Haying, grazing, or burning restrictions There
  are none unless it has been abused to the point
  that weeds, not grass, are the dominant
  vegetation or significant bare ground.

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Unresolved Interpretation Issues for Land Use
Change

• Old grass Cropland that was seeded to grass
  prior to 1999. Currently, ineligible for
  enrollment. Growing interest in crediting at a
  no-till rate.
• CRP brought back into no-till crop production
  Currently not eligible for no-till crediting rate
  because already in grass. Turns into a policy
  debate because want to incentivize farmers not to
  till the CRP land if brought back into production
  (i.e., emission-avoidance credit).