Carbon Offsets May Soon Expand Across Canada

Posted in: Environment     

11 1208 Carbon Offsets

As of fall 2008, Alberta is the only regulated jurisdiction in Canada with a functioning Carbon Offset system. Agri-Trend Aggregation Inc. (ATAI) has been working within the Alberta system since its inception, and returned $8.75 per carbon dioxide tonne (CO2e) in new revenues to Alberta producers that applied for them though ATAI this first year.

According to Bill Dorgan, president of ATAI, the primary focus to generate cash for carbon at this early stage of development has been the Tillage Protocol. ATAI is confident a National Offset System will be operational early in 2009.

Because of this, ATAI is gearing up to begin work in a regulated environment under a National Carbon Offset System.

“We are committed to offering the highest quality aggregation service to producers in the rest of Canada who will qualify for and benefit from this exciting opportunity,” says Dorgan.

Environment Canada released the framework of the National Offset System in March 2008, publishing an overview of the program including eligibility, rules and the process for issuing credits, within a document called “Turning the Corner”.

On August 9th, Environment Canada published another document – ‘Canada’s Offset System for Greenhouse Gases: Guide for Protocol Developers’. This document describes the process for
development and implementation of protocols such as ‘Tillage Management’, as well as other gricultural based protocols under which ATAI can assist producers in the generation and marketing of valuable carbon offsets.

“This is a particularly good opportunity for producers in Saskatchewan and Manitoba, as they previously only had access to a voluntary market in the US. Now, hopefully, we will have the opportunity to help them achieve full potential and maximize value right here at home,” he says.

“As a result, we encourage Saskatchewan and Manitoba producers to consider their existing choice in light of a potentially better alternative, with less liability and more flexible
management options.”

Farmer cashes nice ‘carbon cheque’

Russell Friesen operates Harvest Moon Acres Inc. near La Crete, Alberta. He’s also an Agri-Coach with Agri-Trend Agrology. Harvest Moon Acres cropped about 11,000 acres in 2008. When the opportunity to turn low-disturbance seeding into carbon credit cash, Friesen decided to check into it further.

. . (I) ended up receiving cheques that totaled nearly $30,000, for . . . about two days of paperwork. Russell Friesen - La Crete, Alberta

“I’d heard about carbon credits for quite a few years and was thinking it would be nice if it happened some day. When it did come to the point where we could do something, a friend and I decided that the best way to learn the business was to jump in and do it,” says Friesen.

”I had to learn both sides – selling the credits as a farmer and doing the paperwork as an Agri-Coach. It was pretty painless. We had no major hiccups. The PIA (pain in the ass) factor was
pretty minimal. We had a good land database, but it’s still a challenge,” While Friesen had decent records, he found it still took some work sorting through who owned what, with uncles, other family members and renters involved.

“As long as you had your fields set up so everything was clear and done by quarter section it was fine. The fields that wander across quarters, with a couple of landlords, can get complex. But it ends up being pretty straight forward,” he says.

Friesen was able to include land that met the tillage protocol back six years. He used Agri-Trend’s on-line database, where information is kept for every field pass. He says Alberta’s crop insurance organization also tracks whether a farmer is direct seeding or not.

“We used the Agri-Trend data, then Crop Insurance data to verify it. As long as we had good records it was simple,” says Friesen. “It worked out to more than a buck an acre per year, times six years, so it worked out to $10 an acre. That ended up being a nice chunk of change.”

Friesen ended up receiving cheques that totaled nearly $30,000, for what he said was about two days of paperwork.

“It wasn’t 11,000 acres back then, but we went back to all the acres we farmed since 2002. From now on, we just add the acres we’re in for this year. If we decide to tear up a field because it’s too rough or we rutted it up, we just don’t get paid that buck an acre on those acres for that year. The next year we’re eligible to go back in,” he says.

“The next year will be a piece of cake. Once you’re in the database, all you have to do is add new fields if we pick up any new land that year. Then it’s just a checkmark and it’s submitted on-line.”

“From now on, we’re hoping it will be $11,000 to $13,000 a year, depending on what the credits are worth. That can buy us an Autosteer!”

Now that he’s been through the process, Friesen says he’s comfortable working through the procedure with others.

“I did one of my client’s paperwork. He has a 3,000-acre farm and we did all his in one evening,” he says.

“I like the program because it’s pretty straightforward. The protocol is there. If you do it you get paid. If not, you don’t. It’s not long-term lockups. I talked to other companies earlier on, but felt it wasn’t what we were after. It was too vague and the risk was higher. Here, the risk is pretty low.”

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About the Author
Bill Dorgan

Dorgan is President of Agri-Trend Aggregation Inc. He has held a number of key positions in the agricultural industry, most recently as Vice President of PricewaterhouseCoopers Inc. Advisory Services, with extensive senior management experience in sales, marketing, business development and finance in the agricultural sector.

He has also been Vice President of Canada’s largest agricultural co-operative, overseeing the largest agricultural retail supply networks in Canada, with P & L responsibility for sales in excess of $400 Million. 

Dorgan can be reached at bdorgan@agritrend.com 

 


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