Soil carbon controversy: Unfounded concerns or healthy skepticism?

Soil carbon credits have been gaining popularity in the US voluntary carbon market and Australia's compliance-based market, but there are numerous critics of this type of carbon credit. Soil carbon credits are generated through projects that enhance soil carbon sequestration, or the process of plants removing CO2 from the atmosphere and storing it below ground through various biological and chemical processes.

By implementing sustainable management practices, such as reduced tillage or cover cropping, agricultural land managers can increase the amount of stored carbon and generate credits for it. However, there are many skeptics of soil carbon credits due to credit quality concerns, inconsistent standards for calculating the change in soil carbon stocks and issues of additionality and permanence.

More broadly, nature-based carbon credits, particularly avoidance credits, have recently come under scrutiny. The Guardian newspaper published an article in January claiming that 90% of REDD+ deforestation projects certified under Verra, the world's largest voluntary carbon crediting standard, did not represent real emissions reductions. The UK-based newspaper's investigation was done in collaboration with Die Zeit and SourceMaterial and was based on peer-reviewed studies from 2020, 2022 and 2023, one of which was unpublished. Verra disputed the article's findings and released a technical review of the articles cited Jan. 31, stating that two of the three studies used were "patently unreliable" and "contain multiple serious methodological deficiencies."

Soil carbon credit quality

There is no one agreed-upon standard for crediting soil carbon projects as each of the major standards follows a similar yet slightly different methodology for quantifying changes in soil carbon from such projects.

The main components of quantifying soil carbon projects include aligning with applicability criteria, determining baseline and project soil carbon estimates and projections, estimating greenhouse gas emissions, calculating potential leakage, establishing additionality of projects and developing a monitoring plan. The specific protocols for each of these steps vary between standards, which can cause differing quality of credits.

A study done by the Environmental Defense Fund, or EDF, and the Woodwell Climate Research Center reviewed 12 soil carbon quantification protocols and found that the differences between the standards could limit the ability to compare soil carbon credits and ensure that emissions reductions actually occurred.

The Integrity Council for the Voluntary Carbon Market released March 30 its finalized Core Carbon Principles, or CCPs, which outline the fundamental characteristics of high-quality carbon credits. The ICVCM expects crediting programs to begin using CCP-labels by the end of 2023.

The CCP label will be based on climate, environmental and social factors. This initiative represents one approach to determining the quality of each type of credit and crediting program, making maneuvering the market a simpler process for buyers.

"Building a widely shared understanding of what high integrity means for carbon crediting programs and categories of carbon credits is a pre-condition for the development and growth of a viable and vibrant VCM," Annette Nazareth, chair of the Integrity Council, said in a statement March 30.

"The CCPs and program-level criteria we are issuing today are an important step towards a transparent, regulated-like market where buyers can easily identify and price carbon credits that meet consistently high-integrity standards that will also increase ambition over time," Nazareth said.

This initiative will enhance the integrity and credibility of different types of carbon credits and standards, while increasing demand and prices for carbon offsets, David Antonioli, CEO of Verra, said in an interview with S&P Global Commodity Insights earlier this year.

Soil carbon measurement, reporting and verification

A major point of contention for soil carbon projects is how exactly the changes in soil carbon stocks are measured, reported and verified. Under the major methodologies, notably Verra and the Gold Standard, soil carbon quantification can be done by direct sampling, models, calculations or a combination of sampling and modeling.

Skeptics of soil carbon projects say there are problems with each of these methods. A common argument is that soil sampling should be done over modeling or calculations to verify changes in soil carbon stocks. Calculations and modeling are often thought to not be as robust as measuring and remeasuring as the lack of soil sampling limits the integrity and proper verification of emissions reduction.

"There is no sufficient field data to rely on a model at this point. I expect it will take more than 10 years before we will have any confidence in models," Louise Edmonds, CEO and founder of Australia-based project developer Carbon Sync, told S&P Global Commodity Insights via email Jan. 30.

According to the EDF's report, "little evidence suggests that existing models can accurately capture soil organic carbon change at the field level under all proposed management interventions for all combinations of soils and climate."

However, soil sampling has its own challenges due to the enormous spatial variability of soils on a landscape. Different soil structures and textures can significantly impact the amount of carbon stored and the accuracy of sampling only a subset of fields. Furthermore, changes in soil organic matter can take years to realize, so sampling alone does not enable farmers to get a return on their investment in soil carbon projects for several years. In Australia, it takes approximately five years of project implementation before a project begins generating credits, Edmonds said.

"We're taking a hybrid approach of both soil sampling and modeling. If we were just soil sampling, we would want to wait at least five years or so between samples to really separate the signal from the noise," Max DuBuisson, head of sustainability policy and engagement at Indigo Ag, a US-based project developer, said in an interview with S&P Global earlier this year.

Additionality and permanence

A key challenge for soil carbon projects is demonstrating additionality or showing that the storage of carbon wouldn't have happened under business-as-usual scenarios. This requirement of carbon projects limits carbon farming to farmers that have yet to implement sustainable practices. Farmers who have already adopted these practices cannot benefit from participating in the carbon market.

Permanence is also a contentious issue when discussing soil carbon credits. There are varying findings in academic literature surrounding exactly how long carbon is stored in soil.

One way that carbon is released back into the atmosphere is via the respiration of soil microorganisms, which is a key pathway for carbon release in the natural carbon cycle. Additionally, as around 40% or 353.8 million acres of all US farmland is rented or leased, according to the US Department of Agriculture Economic Research Service, changes in the tenure of land can reverse the increased storage of carbon in the soil from regenerative practices due to shifts in management.