Charting a New Course – Carbon Insetting Program

Bayer/Soil Health Partnership Conservation Innovation Project Overview

The “Scalable on Farm Greenhouse Gas Reductions and Water Quality Improvements: Development and Implementation of an Economical and Verifiable Insetting and Accounting Framework” project began in December 2016. At the time, corporate interest in supply chain interventions that reduce GHG emissions was growing and many coffee, chocolate and cosmetics companies had already begun to implement on-farm emission reduction projects in their supply chains. However, at the time no guidance on how the impacts of supply chain interventions, often called ‘insetting’ projects, should be quantified and reported was available and there was concern about the credibility and consistency of these insetting claims.

With funding support from the USDA’s Natural Resources Conservation Service’s (NRCS’s) Conservation Innovation Grants (CIG) Program, Bayer, NCGA and partners began work to develop a unique and comprehensive value chain intervention that places climate smart agricultural practices on the right acres, verify the success and impact of those practices, and ultimately create a replicable approach for corporate carbon emissions reduction in their supply chain. One of the most innovative components of the project focuses on delivering management practice systems that create both opportunities to reduce corporate value chain emissions and provide improved economic outcomes for farmers. When complete, it will be the first externally-validated intervention for the supply chain for row crops in agriculture. Bayer is committed to positively impacting climate change and in the past year has set goals to reduce field greenhouse gas emissions by 30 percent by 2030 as well as be carbon neutral in its own operations.

The project is the second pilot in the world to achieve Design Certification – see: https://registry.goldstandard.org/projects/details/2824.

Certification documents including details such as the objectives, methodology, references relied upon and findings of this process and a final certification statement can be found at: GoldStandard (sustain-cert.com).

What is insetting?

“Carbon insetting” is a concept that takes an alternative approach to “carbon offsetting” by helping companies achieve carbon/greenhouse gas reduction goals. Unlike offsetting, where tradable assets like carbon credits are created and sold to others, carbon insetting is a proactive approach to reducing carbon directly and reporting those reductions within a corporation’s own carbon footprint. For example, a hotel chain has funded the creation of olive groves, paying residents to plant and care for the trees, and then buys back the olive oil for its hotels. Insetting can directly reduce the hotel company’s carbon footprint by the atmospheric carbon removed by the olive trees and the farmer practices.

In this CIG project, participating companies partnered with farmers in their supply chain who took steps to reduce Greenhouse Gases on their farms. Although many different pathways have been explored for corporate GHG reduction, such as purchasing offsets, the concept of insetting brings many co-benefits that offsetting doesn’t have. As an investment, insetting can move the company several steps closer to being carbon neutral, while also improving efficiency, strengthening communication and trust within the supply chain and improving communities.

Who is doing it? What are others doing?

Partway through the CIG project, the Value Change program, co-led by SustainCERT (SC) and Gold Standard (GS), was initiated to provide guidance for companies to report on Value Chain emissions reductions in line with the Greenhouse Gas Protocol and recognized by Science Based Targets. As an early part of the Value Change Program pilot phase, Bayer and partners (including Viresco) engaged with GS/SC to test the CIG Project intervention framework, seeking certification of the Project. This effort, coordinated by Viresco on behalf of the CIG Project team, provided critical learnings for “on-the-ground” application of the Value Change Interventions Guidance. SustainCERT and Gold Standard will use these learnings to adapt processes and recommend updates to rules and requirements for the Value Chain Intervention Guidance and certification process.

As a result, the CIG Project is the second intervention, globally, to achieve Design Certification under the Value Chain Intervention Guidance and Gold Standard for the Global Goals (GS4GG) (see (https://www.sustain-cert.com/press-release-2/). This achievement verifies that the project has followed best practice principles and is a key milestone toward unlocking credible value chain emissions reductions and removals aligned with corporate reporting, Science-based Targets and Net-Zero goals. Viresco has played a significant role in the design of the CIG Project Intervention framework, and has been supporting the development of a number of GS/SC Value Change Working Groups and Platform Labs including Use of Products Sold and EF Tracking Mechanisms.

Who were the Project Partners?

The CIG project had six partners: Soil Health Partnership, Bayer, Viresco Solutions, Radicle Balance, Crop Growers LLC, Dagan LLC (formerly Applied GeoSolutions and DNDC-ART LLC) and EFC Systems (formerly AgSolver). The roles and responsibilities of each organization are as follows:

Soil Health Partnership (SHP)– SHP was the project administrator, responsible for coordination and financial reporting. In addition, SHP’s grower-cooperator sites formed the basis for evaluating the climate smart agriculture practices against conventional methods of production.
Bayer– Bayer co-funded the project and was heavily involved in all aspects of the project related to Bayer’s GHG insetting program. Bayer also reports on all the verified environmental benefits achieved from the project.
Viresco Solutions – provided project management and technical support and lead the creation of the carbon accounting and insetting framework. Viresco also assisted in data management and project monitoring, reporting and verification.
Crop Growers LLC (CG)– CG was also be involved in the testing and development of the low-cost, low-touch verification system. Specifically, CG uses data from the Satellogic constellation (which provides real-time coverage) to assess cover crops and reduce tillage practices.
Dagan – Dagan was responsible for testing and development of a low-cost, low-touch verification process. Specifically, AG’s Operational Tillage Information System (OpTIS) was tested to audit crop residue, tillage and cover crop practices. The DNDC model was used to quantify these metrics.
EFC Systems – EFC Systems deployed its precision business planning services to the participating growers, provide high resolution environmental performance analysis and evaluate the economic and environmental performance of the project using precision agriculture data sources.

With the help of our collaborators, we produced the following discussion papers as a basis for developing the Intervention Framework. The discussion papers are available for download here:

Other Resources

ICROA webpage and report: http://www.icroa.org/Insetting

Ecometrica paper: https://ecometrica.com/white-papers/is-insetting-the-new-offsetting