Voluntary versus state-based compliance markets in the United States

In the United States, voluntary and compliance carbon markets are being created there is an eﬀort to match producers of carbon credits with those that would like to purchase credits. Each market has unique obligations and requirements. Farmers and those advising farmers are confused about the marketplace. The purpose of this document is to provide useful information about the voluntary and compliance markets. The target audience is farmers, crop consultants, and scientists. The document is organized into four sections, general information about the markets, answers to questions from certiﬁed crop consultants, market glossary, and requirements about speciﬁc markets. These marketplaces are rapidly evolving and will likely change as the markets mature.

example, many voluntary markets are paying between $10 to $20 per metric ton. In the California Low Carbon Fuels Standard, carbon credits are currently trading for $200 per metric ton. Third, for a seller to market credits, pathways must exist. These pathways are still being developed and involve discussion among the project developers, protocol developers, assessor and verifiers, and buyers.

Voluntary Markets
• The number of credits for trading are not fixed.
• Credit prices depend upon a contract between the buyer and the seller.
• Are managed by a coalition of companies that may be a company or a non-profit organization.
• Are often driven by corporate sustainability reporting (CSR), financial regulatory disclosure, or environmental, social, and governance (ESG) investing.
• Are complex in that each program has slightly different protocols developed by a number of protocol developers (most generally follow IPCC 2019 guidelines).
• Can include offsets and inset/emissions factors depending on the source or scope of the emissions (see Glossary document for definitions).
• Can be sold to a third-party entity.
• Are optional (not required by law) for the credit generator (i.e. farmer) or buyer (i.e. industry).
• May require adoption of new practices (additionality) or the purchase of a commercial product.
• Often vary in permanence requirements (10 to 100 years) for long-term soil carbon sequestration.
• Include pathways for payment or compensation for soil organic carbon storage, GHG emissions abatement, water quality improvement, and biodiversity enhancements.
• May provide pathways to obtain payments for storing carbon in soil.

Compliance Markets
• Are made in response to a government legislation.
• The number of credits for trading are fixed and are based on the regulatory requirements.
• Purchasing credits may not be optional for specific industries and manufacturers (buyers).
• Farmers choose whether to participate.
• Have been formed in 12 states and will be soon in other states as laws are passed.
• As of April 2021, options for providing payments in the California Lower Carbon Fuel Standard (LCFS) program for storing carbon in soil are under discussion.
o Research is being conducted to determine an inexpensive and accurate pathway to measure/predict C storage.
• Each market selects or modifies an existing pathway (method) to fit their needs.
o Example: The LCFS is an active market.  The goal of this program is to reduce the carbon intensity of petroleum-based fuels 20% by 2030 and 80% by 2050.
 Payments have been made to liquid fuel producers that help achieve these goals.
 Farm practices can further reduce GHG emissions. However, before farmers can receive payments, a pathway (method for measuring and validating the reduction) must be approved.
 Currently, the California (and Oregon) markets calculate carbon intensities using a modified form of the U.S. Department of Energy (DOE) GREET model.

Summary:
Voluntary and compliance markets have similarities and differences. Similarities include that sellers can choose to participate and farmers may receive payments for participating. A difference is that in voluntary markets, buyers can choose to participate, whereas in compliance markets buyers may be required to participate. In addition, all markets have different pathways/protocols for determining offsets.

Role of the Federal Government
The U.S. Federal government influences renewable fuel production through the Renewable Fuel Standard.
The RFS program is a national policy that requires a certain volume of renewable fuel to replace or reduce the quantity of petroleum-based transportation fuel, heating oil or jet fuel. The Renewable Fuel Standard, combined with other subsidies and mandates from both state and federal governments, has increased the amount of ethanol blended into the nation's fuel supply beyond what would occur in a free market. Under the law, the EPA sets annual quotas for conventional renewable fuel (usually corn-based ethanol), advanced ethanol alternatives made from non-edible material and biodiesel. These quotas are then translated into blending requirements for individual refiners. Companies that do not meet their blending mandates must buy Renewable Identification Numbers (RINs) to cover the difference, unless they are a small refinery that qualifies for a hardship waiver. In this program, the four fuel categories are biomass diesel, cellulosic biofuel, advanced biofuel, and total renewable fuelA full description of the RFS is beyond the scope of this fact sheet, and additional information is available at https://www.epa.gov/renewablefuel-standard-program/fuel-pathways-under-renewable-fuel-standard.
At some time, the federal government may choose to regulate voluntary markets and the state-based compliance carbon trading programs. To date, there has been no federal movement on voluntary and state markets.

Question and Answers about Carbon Market
Disclaimer: Many answers to the voluntary carbon market questions are dependent upon the specific platform and their specific rules. This document is not intended to provide legal advice.

Who is buying the credits?
• There are two broad carbon market types, voluntary and compliance markets.
 In voluntary markets, anyone who desires to reduce their carbon footprint can voluntarily purchase carbon credits.
• Buying voluntary carbon credits is popular with high-emission industries such as manufacturing, technology, fuel, and food products.
• Some examples of credit buyers include Cargill, Google, and Shell Energy.
• Some corporations are voluntarily buying carbon credits to show their social responsibility, secure better financing rates, and to provide marketing opportunities.
 In compliance markets, such as the California or Oregon Low Carbon Fuels Standard (LCFS), fossil fuel makers are required by law to reduce the carbon intensity of their fuels. They do this by buying low carbon fuels to mix with their high carbon fuels or by buying carbon credits to offset this obligation.
• The California LCFS compliance market was established by law in 2011 where the price of a metric ton of CO2 (as of March 2021) is about $200.
• Entities that are selling credits must have approved pathways (protocols/rules).

Can I actually store carbon long term in soil?
• Yes, carbon can be stored in soils for a very long time if the carbon inputs in soils are equal-to or greater-than the carbon losses from soil respiration. Storing carbon in soil also improves soil productivity and resilience.

How do I verify the amount of carbon in my soil?
• Soil sampling and subsequent analysis for soil organic matter (SOM) or soil organic/inorganic carbon is used to measure the amount of carbon in the soil.
• Most commercial agricultural or soil labs will determine soil organic matter (SOM).
• To roughly convert laboratory SOM results to soil organic carbon (SOC), multiply SOM by 0.58.
• To convert SOC to the number of carbon credit(s), multiply SOC by 3.667 (The molecular weight of carbon dioxide (44 g/mol) divided by the molecular weight of carbon (12 g/mol)).
• There are many different proposed pathways for estimating soil carbon change. Selected approaches to estimate C storage include: • At multiple locations, measure the changes in the amount of soil carbon stored in the soil. This involves sampling the same points multiple times.
• Measure the amount of plant biomass returned to the soil annually. If this is greater than the maintenance requirement, C should be stored.
• Use a carbon model that considers climatic, soil benchmarks, and crop to estimate C storage.

What do the different soil tests mean?
• Soil organic matter (SOM): measures all the organic materials in the soil and includes decomposing plant and animal tissues, and byproducts of microbial processes.
• Soil organic carbon (SOC): is the of carbon content of the soil organic matter.
• Permanganate-oxidizable carbon (POXC): Also known as active carbon, is highly sensitive to changes in management such as increasing or decreasing tillage or crop rotation diversity.
• Dissolved organic carbon (DOC): Is organic carbon dissolved in the soil water. It is organic carbon that can be rapidly mineralized.
• Haney test for soil health: The Haney Test alone cannot be used to create carbon credits; it estimates the nutrient availability for soil microbes.
• This test measures soil respiration (Solvita CO2 burst test), water-soluble organic carbon, and organic nitrogen and their ratio.
• Haney soil test numbers should be used as a comparison over time to determine your progress toward improving soil health.
• Other test results included in the Haney test are nitrate, ammonia, phosphorus, aluminum, iron, phosphorus, calcium, magnesium, and sodium.
• CO2-burst test (Solvita): measure of soil respiration from soil microbes that is an index of microbial activity in soil.
• Microbial biomass carbon: Carbon present in microbial organisms such as the bacterial cell, fungal hyphae, nematodes body, etc.
• Labile carbon: forms of organic matter that decompose within a growing season or less than a year (green manures or leaf litter).
• Non-labile carbon: complex organic compounds, such as lignin, that take several years to decompose.
• Stable humus: organic matter which has reached a point of relative stability where the break down is very slow. This carbon might remain in the soil for centuries.

How quickly and accurately can we detect changes in soil carbon?
• It can take at least four to five years to detect changes in soil organic carbon resulting from management changes. The ability to detect changes depends on interactions between management, climate, and soil.
6. What depths do we need to measure for accurate soil carbon estimates?
• Most standard fertilizer recommendations determine the soil organic matter of the surface soil. These values provide a reference for easy comparisons. To assess the amount of carbon that was sequestered, samples should be collected from the entire rooting zone.
• The soil root zone (generally up to 3ft) will be most impacted by management. This depth should be benchmarked (measured before a change in management) and monitored for SOC changes after management changes are implemented.

7.
What are the practices that will increase soil carbon the most/fastest?
• Management practices that increase the amount of carbon (manure or biomass) returned to the soil when combined with reducing soil disturbance have the greatest effect on increasing soil carbon storage. Examples include use of no-till, strip-till, and planting cover crops.
• To find a combination of practices that works for your fields, it is helpful to visit with local agronomists or extension agents.

How does weather (drought, flooding, etc.) affect carbon storage or loss?
• Soil carbon is lost through the microbiological degradation of plant materials that are contained within the soil and from soil loss during wind and water erosion events.
• Climate factors that reduce the amount of biomass returned to the soil following harvest or changes the microbial activity can increase or decrease carbon loss.
• If adverse conditions prevent planting a crop, soil carbon can be lost.
• Extreme climatic events such as enhanced warming, drought, and heavy rainfall can change how much C is stored in soil.

How does tillage affect soil carbon storage or loss?
• Soil carbon is protected when the soil is aggregated (binds together in small clumps) and is physically stable. Tillage breaks soil aggregates which makes the carbon stored in soil more susceptible to microbial decomposition and erosion.

Do soils become saturated with carbon?
• A soil can reach a point where biomass additions are equal to the amount that is lost. At this point, soil carbon will stop increasing. However, this point can change with changes in temperature and moisture as well as increases or decreases in the amount of plant biomass added to the soil.
o It may be possible to increase soil organic matter beyond the "saturation" point by planting cover crops, reducing tillage intensity, or planting crops that produce more plant biomass.

What are the different carbon markets?
• There are two broad carbon markets: compliance and voluntary. Compliance markets were the result of government regulations, whereas voluntary markets were developed by industry and non-profits.
• Multiple forms of compliance and voluntary markets currently exist. Most soil carbon credits are presently being traded through voluntary markets.
• For more information, see the supplemental document on voluntary versus compliance markets.

Who are the companies working in voluntary carbon markets?
• There are many opportunities for farmers to sell C credits through the voluntary markets.
Each market has a slightly different pathway for estimating and selling credits.

Do I need a broker company?
• No, you do not necessarily need a broker company to sell carbon credits. Brokers can be independent traders or investors, tied to corporations or platforms, and/or specialty service providers.
• Some platforms enable farmers to directly sell their credits while others purchase credits from farmers for resale.
• Aggregation and brokering companies can reduce the amount of time you need to dedicate for selling carbon credits. The broker also assumes a portion of the sale risks.
o However, most will either charge fees, take a portion of the proceeds for their services, or purchase credits at a flat rate for resale.
• You must consider how much time you are willing to commit to the sale of the credits, your risk comfort level, and your knowledge of the markets.
14. Can I sell carbon credits directly myself?
• As markets become more mature, the answer to this question can change. When you make your marketing decisions, consider your: o Knowledge, preferred level of involvement, risk comfort, available time, and willingness to monitor and verify the credits, • There are currently platforms within the voluntary carbon market which allow farmers to directly register and sell their credits.
• It is too soon to tell if these self-service markets give producers a market advantage.

Who gets the payment/owns the credit on rented land?
• This is a gray area for voluntary carbon markets because the markets can change with time.
o It is a good idea to seek out legal advice for your specific situation prior to entering carbon credit contracts.
o For some carbon platforms, the credit follows the field (landowner), not the farmer. For other carbon platforms, this could be different.
• The ownership of credits is recorded in registries which are checked during the verification process to prevent two parties from obtaining duplicate credits on the same ground.
• Emission reductions (avoidance of carbon dioxide, nitrous oxide and methane emissions and the use of fossil fuels) and tillage and crop production practices (which generate offsets) are management choices and are the responsibility of the operator.
• Specifying the division of carbon credit responsibilities and ownership in rental agreements will help avoid conflicts.

What happens if I lose or can't show that I have increased carbon?
• The carbon credit contract will specify the steps that will be taken and/or consequences if credits do not pass verification.
• If the farmer cannot fulfill contractual obligations, many companies will pause or withhold payment until the obligations are met.
• If you have concerns that you may be unable to meet contract requirements, please seek appropriate legal counsel to explore your options.

Is the program measuring and rewarding changes in soil carbon? Or rewarding adoption of conservation practices?
• Currently, most programs only award credits for soil carbon sequestration offsets and/or greenhouse gas emission reductions.
o Some platforms, such as the Ecosystem Service Market Consortium, are working to develop protocols that encompass improvements in soil, air, and water quality.
• Rewards for adopting specific management practices are being considered by some marketplaces. This approach is being considered to reduce quantification costs.
• At this stage, the future of the market for ecosystem services is uncertain.
18. Will farmers who have already been working to increase carbon in their soils be able to benefit from these programs?
• In the voluntary markets, payments are most often provided for adopting new practices (additionality, see glossary for definition). However, some companies allow farmers to receive payments if the new practices were only recently adopted.
• Some markets have safeguards that reject applicants who intentionally degrade soil resources.

Are greenhouse gas emissions and carbon footprints of the farm operation going to be
considered in the programs? Is the program based on net storage rather than just carbon levels?
• Most programs measure the entire carbon footprint of the food or feedstock that is being produced, so this would account for all GHG (CO2, N2O, CH4) emissions of the farm (land preparation through harvesting) and convert that value into carbon dioxide equivalent.
• Carbon credit is a generic term for any tradable certificate or permit representing the right to emit one metric ton of carbon dioxide or the equivalent amount of a different greenhouse gas (tCO₂e). Carbon credits can be generated by following an approved pathway that quantifies and validates reductions in CO2 emissions (CO2 equivalent of GHGs). For example, switching from conventional tillage to no-tillage.
• Carbon credits are a term which is misleading and confusing.
• Other terms that can be used are CO2 equivalent, soil organic carbon offsets, or greenhouse gas emission reductions. The SOC is converted to number of carbon credit(s), by multiplying SOC by 3.667.
• Many life cycle analysis models convert greenhouse gases to CO2 equivalent (CO2eq).

How large of a payment should I expect?
• Compliance markets are not approved for carbon storage in soil through crop production, and therefore payments will only be through the volunteer markets.
• In the volunteer markets, markets are variable and have been ranging from $4 to $40/acre. However, most range from $10 to $20 per acre. beyond what is currently being done on the farm. Some markets require 'additional' activities or changes in farming which would not be possible without the sale of carbon credits. For example, if a farmer been using no-tillage for many years, then they will not earn credits for using no-tillage. In this context, credits could only be earned by doing something in addition to no-tillage. In other markets, additionality means producers are required to continue to reduce their emissions or continue to increase their soil carbon storage even if they are a low carbon producer. Not all markets require additionality. For example, the California Air Resource Board (CARB) compliance market does not use additionality.

Baseline:
The amount of soil carbon on your farm at a point in time. A baseline would be that your soil has 20 tons of carbon per acre and that you apply 150 lbs N/(acre × year). Based on these values the amount of carbon stored in the soil or decreases in the amount of N applied to the can be calculated.
Baseline is a term that is often linked with past emissions and future goals or mandates.
Benchmark: Very similar to a baseline. It is a standard or a point of reference that can be used to verify changes in soil carbon. Benchmarks are commonly used in policies, such as Lower Carbon Fuel Standards to set an emission standard (rules for pollutant releases) for specific fuels or methods of making fuels. For example, if a fuel producer goes above their carbon benchmark, then they must purchase carbon credits (including emission reductions or offsets), but if they go below their benchmark, they can sell carbon credits as emission reductions to others.
Bulk density: A measure of how heavy and tightly packed the soil is. This is calculated by taking a known volume (size) of soil, drying the soil, and dividing the weight of the dry soil by its volume. Uncompacted (light, loose) soils with high organic matter content will have a low bulk density. Compacted (tight, hard, heavy) soils will have a high bulk density. Bulk density is required to quantify how much carbon is in the soil.

Business-as-usual:
A set (unchanging) process or normal practices and activities. These normal practices can be for an individual farm or a region with similar traits. For example, planting corn every year in eastern South Dakota normally means fall tillage followed by disking in the spring and planting when soil temps go above 55 o F. The common practices for an area can be used to figure out the typical carbon footprint of an area and these averages are sometimes used in deciding carbon credit rules.

Calibration:
The process of comparing measured values with known levels or standards. A process used to adjust models and/or tools to make them match real-world systems and results. When a model or tool has been calibrated, it can be used to estimate carbon storage.

CARB (California Air Resources Board):
The "clean air agency" in the state government of California.
This is a group of people appointed by the Governor of California and approved by the State Senate to set the rules for meeting California's climate change policies.

Carbon broker:
A person or company that serves as a middleman between carbon credit (offset and emission reduction) sources and buyers. Each offset or emission reduction source can provide carbon credits. Brokers can help collect the number of carbon credits needed to attract corporate or other big buyers who can pay higher prices.
Carbon credit: A carbon credit is a generic term for any tradable certificate or permit representing the right to emit one metric ton of carbon dioxide or the equivalent amount of a different greenhouse gas (tCO₂e). It is also used to describe greenhouse gas emission reductions or offsets. There are three major greenhouse gases that are related to farm operations that can generate carbon credits: carbon dioxide (CO2), nitrous oxide (N2O), and methane (CH4). Each of these gases have a different effect on climate, so a common term called CO2 equivalents (CO2 eq) is used to make all carbon credits equal. For example, 1 ton of methane is equal to about 25 tons carbon dioxide and 1 ton of nitrous oxide is about 300 tons of carbon dioxide.
CAP: Common Agricultural Policy in the European Union. Its main purpose is to provide a stable, sustainably produced supply of safe, low-cost food for people, while also ensuring a decent standard of living.
Cap: Defines the max amount allowed. As in a cap on emissions.

Cap-and-trade:
A policy tool where the government places a limit or cap on the emissions from polluters.
This cap can sometimes become tougher with time. Polluters can meet this cap by reducing their emissions, or by purchasing carbon credits. The carbon credit prices are set by market demand. The goal of this type of policy is to use high credit prices to push polluters into cutting emissions to save money.
The U.S. Acid Rain program has successfully used cap-and-trade policy approaches to reduce acid rain.

Carbon dioxide (CO2):
A greenhouse gas which has a global warming potential (GWP) of one. Carbon dioxide is produced when plants, animals, microbes, and other living beings use oxygen to breathe (aerobic respiration). During this process, living beings convert food to energy and carbon dioxide. It is also made when fuels like coal, ethanol, or wood are burned. It is a common greenhouse gas which is both released to and taken from the air by farm activities.
Carbon dioxide equivalent (CO2 eq): A measure that converts greenhouse gases, based on their global warming potential (GWP) to an equivalent (comparable) amount of carbon dioxide. The impact that each gas has on our climate over the next one hundred years is called the global warming potential. The global warming potential of carbon dioxide is considered one, and other greenhouse gases are converted to equivalent amounts of carbon dioxide (CO2 eq) The conversion factors for methane and nitrous oxide are approximately 25 and 300, respectively. See carbon credit and EPA GHG Overview for more information.
Carbon footprint: This is a term that can have many meanings. How, when, and where it is used affects the meaning. The carbon footprint is the total amount of greenhouse gases that are made or produced by any given action. Many online tools such as TNC's Carbon Footprint Calculator can be used to assess personal carbon levels. In farming, the main greenhouse gases are carbon dioxide, nitrous oxide, and methane. Each of these gases have a different effect on the earth's climate, with nitrous oxide and methane having about 300 and 25 times more than the impact of carbon dioxide, respectively. As a result, a carbon footprint that only considers carbon dioxide can be markedly different than one that includes all greenhouse gases.

Compliance market:
A market formed in response to a government rule or regulation. A system for exchanging goods or services for money that people, businesses, or organizations must participate in to meet regulatory mandates. With respect to the carbon market, compliance markets have been established in many locations including, California and Oregon.
Corporate social responsibility: Large businesses are expected to follow U.S. standards and follow ethical practices, such as not using slave labor or dumping harmful chemicals into the streams and lakes. People want to know that the companies did not hurt nature or people when making the product they are buying and using. This collective (group) goal of doing business ethically and the right way is often called corporate social responsibility. Companies often purchase offsets voluntarily to appeal to buyers and to meet social responsibilities.
Credit/offset creation: A carbon credit, or offset, is a documented decrease in CO2 or in other greenhouse gas (GHG) emissions that is traded from a CO2-reducing source (ex: agricultural producer or clean fuel manufacturer) to a CO2-emitting industry. The CO2-emitting industry purchases credits to reduce their carbon footprint. Credits can be made by many different industries including manufacturing, shipping, energy production, and agriculture. For example, credits could be made by planting trees, developing an improved-efficiency engine, reducing the amount of nitrogen fertilizer applied to a field, or reducing tillage intensity. There are many ways to calculate credits and carbon footprints.
DAYCENT -A daily timestep version of the CENTURY model. This is a process-based model used to assess carbon, nitrogen, and water cycling in ecosystems.
Denitrification: This is a biological process where nitrate (fertilizer) is converted to nitrogen (N2) gas and released to the air. This process is not fully efficient, and a portion can also be lost to the air as nitrogen oxide (NO) and nitrous oxide (N2O).

DNDC (DeNitrification-DeComposition Model):
A process-based model that estimates the greenhouse gas emissions and soil carbon due to crop, grassland, and forest growth. This model was developed to estimate soil nutrient changes. The DNDC model has been used by scientists for several decades and has proven useful worldwide in modeling soil nitrogen changes and nitrous oxide emissions. Compliance with these mandates has created a premium international market for low carbon feedstock, biofuels, and bioproducts. Greenhouse gas: Any gas that retains heat within the atmosphere (air). There are 25 gases that the IPCC has found to cause climate problems. The most mentioned gases are water vapor (H2O), carbon dioxide (CO2), nitrous oxide (N2O), methane (CH4), sulfur hexafluoride (SF6), ozone (O3), and chlorofluorocarbon (CFCs). Chlorofluorocarbons are a group of many gases used in aerosol cans, refrigerators, and making many things, such as computer chips. The climate forcing, or ability to influence climate, of these gases varies and changes as more of these gases are emitted.

GREET® (Greenhouse gases, Regulated Emissions, and Energy use in Technologies model):
A life cycle analysis model used to calculate carbon footprints. GREET® is a suite of life-cycle analysis (LCA) models developed at US-DOE-Argonne National Laboratory. This model has been adopted by many U.S.
policymakers and is used in both California's and Oregon's carbon markets. GREET can be used to calculate life cycle energy consumption, fossil fuel energy used, greenhouse gas emissions, air pollution emissions, and water consumption of renewable and non-renewable fuels.
Insetting: Carbon insetting is a proactive approach to reducing greenhouse gas emissions that occurs within a company and supply chain.
IPCC: This is the International Panel on Climate Change. This global group of scientists work together to identify sources and sinks of greenhouse gases and to model how our world will be changed by these emissions in the future. This group publishes data and forecasts based on consensus (meaning, they all must agree, which is hard to do with several hundred scientists). Their findings are updated every few years as more is learned about climate change.
Kyoto Protocol: This is an international treaty adopted in 1997 which set the core rules and principles for carbon markets. This agreement created rules for developed and developing countries while setting voluntary country-specific targets for emission reductions.
Legume: A group of plants which take nitrogen from the air to add to their plant structure. Legumes belong to the family Fabaceae (or Leguminosae), or the fruit or seed of such a plant. When used as a dry grain, the seed is also called a pulse. Legumes are grown for people and livestock to eat. Well-known legumes include alfalfa, clover, beans, peas, soybeans, and peanuts. Legumes are notable that most of them have symbiotic nitrogen-fixing bacteria in structures called root nodules, and they play a key role in crop nitrogen dynamics.

Life cycle analysis (LCA):
Life cycle analyses (LCAs) are used to gauge carbon intensities (CI) for ag products such as biofuels and high-end foods. The supply, demand, and use of ag products and trade-offs related with farm systems have direct and indirect effects on local, national, and global systems. Plants capture carbon from the air. With proper care, nature can transfer this carbon into soils. Many farm practices can reduce or avoid emissions. Farms and fields can be managed to make emission reduction credits or offsets, such as soil carbon credits, which can be sold. LCAs can be used to help make choices, reduce climate change, and build a lasting and robust economy.
Farm systems can vary lots within a farm or a given year. LCAs take a snapshot of these changes. Crop and animal yields do not always meet farm goals. As a result, we need to focus on long-term gains rather than short-term impacts. For example, changing crop residue into soil can take ten years of more. While nitrogen losses due to poorly timed fertilizer use can occur within hours or days. Actions which support long-term, positive rural economy (such as using biofuels to produce crops) and farm system benefits (such as soil health and water quality) are needed to protect the future of our farms and ranches. Mandate: A required action, activity, order, or target. This is a term commonly used when talking about laws or policies where compliance is required.

Lower Carbon
Mandatory: It is required.

Maintenance requirement:
The amount of organic carbon required to keep the soil organic matter at the current level. The maintenance requirements for soil carbon vary with climate, soil type, and farm practices.
For example, if the surface 6 inches contains 2 million lbs of soil, the soil contains 3.5% organic matter, and 20% of biomass carbon is retained in the soil following degradation, then the maintenance requirement likely is, The amount of residue varies across locations and crop varieties. This math assumes that only 20% of the added biomass goes into soil organic carbon. This biomass (9667 lbs biomass/acre) is the non-harvested surface residue (leaves, stems) plus roots that must be kept in fields to keep the soil organic matter at 3.5%. For corn, a 200 bushel/acre crop returns about 9500 lbs biomass per acre. If the root to shoot ratio (roots produced/{shoots + grain}) is 0.55, then for this example, the corn roots return over 5000 lbs biomass/acre to soil.
Methane (CH4): A greenhouse gas that can be converted to CO2 eq by multiplying CH4 by 25. The amount of methane in the air has increased by about 150% since 1750. The primary ag sources of methane are from dairy and livestock.
Replicability: Doing an experiment again or more than once using the same methods.

Saturation:
The point when no more of something can be absorbed. Saturation occurs when a system reaches a chemical or physical limit where no more can be accepted into the system. With soil carbon, some scientists believe that there is a point where no more carbon can be added to the soil. This point could be called the cap. This is a point of debate and some scientists do not believe this to be true. Sequester: The process of isolating and retaining something. When farmers 'sequester' soil carbon, they are using practices that pull carbon dioxide from the air and store it in stable forms in the soil.
Sink: A practice, process, or system which removes pollutants such as greenhouse gases. The most discussed sink for greenhouse gases is soil organic carbon. When plants remove carbon dioxide from the air and store in the soil, the process is called soil carbon sequestration.

Soil carbon sequestration:
Soil carbon sequestration is a process of removing carbon dioxide (CO2) from the air and storing it in the soil by adding soil organic matter. See also sequestration and carbon maintenance.
Soil health: Soil health, also referred to as soil quality, is the continued ability of soil to function as a vital living ecosystem that sustains plants, animals, and humans.
Source: A practice, process, or system which emits greenhouse gases into the air. Validation: The action of checking or proving the validity or accuracy of something. A measurement process used to ground truth or check that models and/or methods are accurate and properly represent real systems.

Verification:
The process of establishing the truth, accuracy, or validity of something. A process of checking that all information, methods, and results are true. Carbon credits go through a verification process by an independent third-party before they are sold. For carbon markets, the process is often like tax audits -the depth of the audit varies from paperwork checks to a visit where results are checked. With carbon markets, verification is used to catch entities which falsely report or misrepresent facts.

Volatilization:
The loss of a gas to the air. This term is often used when talking about ammonia (NH3) or other N fertilizer losses to the air. Losses can be minimized by following the 4R approach, apply at the right time, right place, right source, and right rate. a. Producers must register in the system and enter required information for asset or credit generation, and certify information entered is accurate to the best of their knowledge. a. ESMC is a nonprofit organization b. Producers must show ownership of the assets that will sold into the market.
b. Pilot programs are taking place now with intention of market program launch in 2022.
c. Producers are not required to implement a specific set of practices.
c. There is no contractual volume for producers and the standard contracting length is 5 years c. The act of implementing conservation practices may have associated costs. Producers may be responsible for practice implementation costs and potential program expenses (such as soil carbon testing).
c. There is no enrollment fee or requirement to purchase agricultural products.
d. Farmers implement conservation practices specific to their production system and geography e. Producers' outcomes are calculated annually over the course of a 5-year crediting period (which may be renewed for three additional 5year contracts for a total of 20 years maximum participation).
e. Scope 1 carbon greenhouse gas contracts are 10-year minimum.
e. ESMC recognizes common practices referenced in NRCS Conservation Practice Standards. However. non-NRCS recognized practices may also be used, provided the outcomes justify their use.