March 9, 2013 08:56 AM

A Carbon Market for the Ducks

Every day farmers make decisions that impact the bottom line and the natural world around them. With high commodity prices driving more grassland cultivation, 500,000 native rangeland acres in the Prairie Pothole Region of the Dakotas have been converted to grain crops.

According to Ducks Unlimited, more than 70% of the wetlands in the Prairie Pothole Region have been drained or severely degraded. This has been catastrophic for wetland bird and animal populations; but thanks to a USDA Conservation Innovation Grant, Ducks Unlimited and partners such as The Nature Conservancy are hoping to stem the tide by developing a method for measuring and issuing carbon credits. Like most carbon markets, the idea is to pay an incentive for stored carbon as opposed to a use that would release carbon into the atmosphere in a form of a greenhouse gas like carbon dioxide.

"Farmers and ranchers provide many benefits to society for free, including carbon sequestration and storage," says Randal Dell, Ducks Unlimited regional biologist–environmental markets.

Challenges and opportunities. Dell says businesses, individuals and other entities interested in offsetting their pollution footprint beyond what they can internally reduce have demonstrated that they’re willing to pay for farm-based carbon offsets. In 2011, U.S. buyers voluntarily purchased an estimated $178 million in certified carbon credits.

"Carbon markets are one way that farmers can begin to realize revenue from management practices and land covers that store or sequester additional carbon or that avoid the emissions of other greenhouse gases to the extent that these benefits can be commoditized as a carbon offset."

Dell acknowledges that the execution of carbon markets in practice isn’t perfect. "The economics have to pencil out for the producer and the producer also needs to be comfortable with the contractual obligations of a carbon contract."

To date, the economics haven’t penciled out for most carbon credit producing practices and management restrictions. The long-term monitoring and reporting obligations have also turned off many producers.

To solve this problem, he says that "aggregators," who act as intermediaries between buyers and farmers, can help eliminate the reporting burden and assume other risks.

"The economics will improve as market demand grows," Dell says. "Demand in the voluntary carbon market has been largely correlated with the health of the economy. The development of a regulatory carbon market in California will also stimulate demand for carbon credits and push up prices."

Learn more about the Prairie Pothole region and the efforts of Ducks Unlimited at

Percent Grassland Converted Chart

From 2008 to 2011, USDA-National Agricultural Statistics Service tracked land expansion for agricultural use, shown in the colors above. The black outlined counties represent an area of interest established by the U.S. Fish and Wildlife Service as the Prairie Pothole Landscape Conservation area.


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