Soil carbon credits are coming, will it be worth selling them?

 

Eric Barker, Beef Central (Australia)

22/06/2022

 

LONG awaited soil carbon credits are expected to hit the market later this year, with multiple aggregators submitting results to the industry regulator.

 

CarbonLink and Agriprove both used last month’s National Carbon Farming conference in Albury to announce credits are on the way.

 

The market for soil carbon is relatively untested, with only one project yielding Australian Carbon Credit Units (ACCUs) in the past seven years. The other major deal was Microsoft’s purchase of soil carbon credits, which were generated using a US scheme, from a group of Australian properties.

 

Market foresters say the outlook for ACCUs shows demand outstripping supply for at least the next decade – as companies look to meet ambitious carbon and climate targets and the science behind carbon capture is still being sorted out.

 

But some carbon credits are worth more than others and a lot of it comes down to a concept called “co-benefits”, where companies are buying another benefit they can market to their customers – like an increase in biodiversity, agricultural production or a social outcome. Pretty pictures and good stories are often part of the deal.

 

Cuong Tran is the general manager of Market Advisory Group, which advises companies buying and selling credits. He said one of the best of examples of premium carbon credits was the savanna burning method.

 

“Because it involves traditional owners working on country, there’s a real social benefit attached to it,” Mr Tran said.

 

“There’s a large premium on the savanna burning ACCUs and although there is a lot of interest in soil carbon, there is no immediate evidence that there will also be a premium on soil carbon projects. Noting that there are a lot of primary production and co-benefits to the farmer.”

 

Companies have already shown interest in the co-benefits of the practices used to increase soil carbon – with multinationals like Nestle and Microsoft claiming to support regenerative agriculture.

 

Concerns over soil carbon and drought ...

 

The Microsoft fallout ... 

 

Focus on delivering credits ...

 

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