Building up soil organic carbon is a good thing that drives productivity, resilience and creates new economic opportunities.
The problem is that the process for turning soil improvements into financial outcomes is complex and fast-moving. Farmers are constantly bombarded with information about new opportunities at the same time as being told about the risks of getting things wrong. Many farmers are so unsure what to do that the easiest thing seems to be doing nothing at all.
This is a doubly bad outcome because it misses opportunities to improve soil health and to provide climate solutions.
Soil carbon markets are really a bolt-on to existing carbon markets, and it shows. More than that it shows in ways that make it especially hard for farmers to participate given the already uncertain nature of farming.
Do we really need soil carbon markets to function in this way? Are there better designs that can address these challenges and still deliver healthier soil, more resilient farms, and payments for ecosystem services?
Of course, we have to draw down atmospheric carbon, and we have to draw down far more than is released, but is it possible that imposing permanence on a per-project level inhibits scale and hence total drawdown?
Does it make sense to consider carbon retention as an annual service provided by farmers?
Retention risk in soil carbon projects is difficult to solve, and possibly doesn’t make any sense to be viewed on a per-project basis. Are there basketing approaches, or cooperative approaches that can provide better solutions?
Do we focus too much on perfect methods and not enough on defining the data that buyers need to make their own decisions in balancing price with quality? Can a more digitally native ecosystem service market provide a greater diversity of opportunity for participation — allowing farmers to pick their own level?
Are we interested in taking a whole new look at what a carbon market designed specifically for agriculture might look like?
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Tenacious Ventures Management Pty Ltd (CAR 001275760), Tenacious Ventures Management Partnership, LP (CAR 001298484), Tenacious Ventures Fund II Management Partnership, LP (CAR 001298483), and Tenacious Ventures Fund II Staple Co Pty Ltd (CAR 001298487) are Corporate Authorised Representatives of Sandford Capital Pty Ltd (ABN 82 600 590 887), Australian Financial Services Licence No 461981, and are authorised to provide advisory and dealing in connection with investments to wholesale clients only.