What is carbon farming and why is the European Commission pushing it?
The term “carbon farming” refers to agricultural methods that enhance the uptake and storage of carbon dioxide (CO2) in soil. CO2 is first absorbed from the air by plants, via photosynthesis. The roots and other parts then decompose and are converted into soil carbon by microbes. Plant matter, and with it the CO2, are thus stored in the soil in the form of organic matter, particularly humus.
The European Commission defines carbon farming as “a green business model that rewards land managers for taking up improved land management practices, resulting in the increase of carbon sequestration in living biomass, dead organic matter and soils by enhancing carbon capture and/or reducing the release of carbon into the atmosphere, in respect of ecological principles favourable to biodiversity and the natural capital overall.”
"Carbon farming is a necessary addition to our efforts to reach climate neutrality. It allows farmers, foresters, and other land managers to become true custodians of our natural environment and shepherds of our climate,” said Frans Timmermans, Executive Vice President of the European Commission in December 2021.
The Commission sees carbon farming as an important part of its sustainable carbon cycles approach which in turn is part of the EU Green Deal, the major strategy for ensuring the European Union becomes climate neutral by the middle of the century. In 2050, the goal is for there to be a constant balance of (residual) greenhouse gas emissions and carbon uptake (net-zero emissions). To achieve this, the Commission wants to propose an EU regulatory framework by the end of the year that will introduce carbon storage and sequestration certification. For carbon emissions, the bloc already has a certification system in place: the EU Emissions Trading System (EU ETS). Carbon offsets are not part of this system and are instead traded on a voluntary market.
At the start of 2022, the French EU council presidency made carbon farming one of its agricultural policy priorities.
What are the German government’s plans for carbon farming?
The new German agriculture minister, Cem Özdemir of the Green Party, has called carbon farming a “huge opportunity” and said in his 2021 parliament maiden speech that he will promote humus build-up. He has said that Germany will support the agricultural agenda of the French EU council presidency.
In November 2021, a ministry spokesperson told Euractiv that “promoting carbon sequestration in agriculture and forestry is of ‘high priority’ and a key instrument for reaching the sector’s climate targets.”
However, in March 2022 Silvia Bender (Green Party), state secretary in the agriculture ministry, told German newspaper taz she had significant doubts over the benefits and practicalities of carbon farming. Citing issues such as the non-permanence of CO2 sequestration via carbon farming, and the fact that the EU already includes natural sinks in its carbon budgets, Bender said: "In my opinion, we cannot provide so much more sink capacity that tradable certificates can be generated at all. We certainly don't want industry to put its own climate efforts on the back burner because it can buy cheap soil allowances and get a free ride. For the climate, that would be an unacceptable zero-sum game." Bender concluded that rather than creating a market for carbon farming certificates, other strategies could be used to reduce the agricultural climate footprint, for example by reducing herd sizes and overfertilization, and rewetting peatlands.
The government has earmarked 75 million euros by 2023 for humus restoration on arable land; an additional 21 million euros are coming in 2022 from the immediate action programme. In the country’s eco-schemes – sustainability techniques that farmers receive funding for under the EU’s Common Agricultural Policy (CAP) – measures such as crop diversification, cultivation of leguminous plants, agroforestry measures and permanent grassland extensification also support carbon soil sequestration.
The agriculture ministry recently announced 23 million euros of funding for a project increasing humus build-up in agricultural soils – the 150 participating farms are testing out different measures to retain and increase soil carbon uptake.
How much carbon could be stored in Germany and the EU via carbon farming?
Humus in soils is the largest terrestrial store of organic carbon: worldwide, about four times as much carbon is stored in soils as in above-ground vegetation, and more than twice as much as in the atmosphere.
According to the Agricultural Soil Inventory by the Thünen Institute (Federal Research Institute for Rural Areas, Forestry and Fisheries), about 2.5 billion tonnes of carbon are stored in the agriculturally used soils (arable land and grassland) in Germany at a depth of up to 1m. The amount of carbon stored in soil in the form of organic matter (mainly humus) depends largely on the type of soil and on the land use. The survey showed that permanent grassland sustains significantly higher carbon stocks than actively farmed fields. Although peat soils account for only six percent of Germany’s agricultural land, they store about a quarter of the total soil carbon of agriculturally used soils. However, about 37 million tonnes of CO2 are emitted every year in Germany from drained peat soils used in agriculture, making peat soil protection particularly important, says Axel Don from the Thünen Institute.
Germany’s 2021 Climate Action Law prescribes that the land use, land use change and forestry sector (LULUCF) provides a sink for 25 million tonnes of CO2 equivalent by 2030, and for 40 million tonnes by 2045.
The Thünen Institut researchers estimate the practically realisable potential for additional carbon storage in the humus of mineral arable soils to be 3-5 million tonnes of CO2 per year in Germany. Their calculations also show, however, that arable soils could lose an average of 0.19 tonnes of carbon per hectare each year in future, triggered by low inputs of organic carbon via plant residue or manure, high temperatures and lower precipitation.
The European Commission has proposed a 2030 target of net annual carbon removals of 310 million tonnes CO2 equivalent in the LULUCF sector. According to the European Commission, carbon farming initiatives should contribute to the increase by 42 million tonnes CO2 equivalent of the land sink. But while forests show annual net carbon removals at EU level, all other land uses such as croplands, grasslands, wetlands and settlements show overall annual net emissions, according to the European Commission.
Internationally, the ‘4Per 1000 Initiative’, first launched in 2015 at the Paris COP climate summit, aims to increase carbon content in the first 30-40 cm of soils by 0.4 percent annually, which would offset a significant share of the CO2 released into the atmosphere from human activities. “The value of four per mile is a symbolic size, the actual potentials are smaller, but still huge,” says Carsten Paul, researcher at the Leibniz Centre for Agricultural Landscape Research (ZALF). A case study in Bavaria found that around 30 percent of this value could be achieved by using certain farming techniques such as intercropping, improved crop rotations, organic farming, agroforestry and conversion of arable land to grassland (see below for most promising techniques for soil carbon uptake).
What are the most promising farming practices?
Preserving permanent grasslands or converting cropland to fallow or permanent pastures are among the most promising soil carbon storage techniques, as they are known to store higher amounts of carbon than tilled fields. Restoring and rewetting peatlands ensures that existing carbon stocks remain intact, and over time such areas have the potential to sequester additional carbon. Agroforestry systems (land use systems in which woody plants (trees or shrubs) are combined with crops and/or animal husbandry on one area) store similar amounts of carbon as permanent grasslands.
On cropland, central measures to increase the carbon intake of soils include improved crop rotations and permanent crops that cover soil all year round. Crops with deep root systems that remain on the land for several years can increase the carbon content by up to 0.35 tonnes per hectare annually, says Sandra Spielvogel, professor for soil science at the University of Kiel. Long roots help to store the carbon in deeper soil horizons.
If not using multi-annual crops, cover crops such as clover, beans and peas, planted after the main crop is harvested, help soils to take in carbon year-round. When ploughed under as green fertiliser, they also aid humus build-up.
Increasing the input of organic matter through returning crop residue to the land – be it directly or in the form of slurry, manure, compost or digestate – is suitable for increasing the land’s carbon intake.
Researchers are still unsure whether reduced tillage can lead to humus build-up. While this measure preserves the soil structure and lets the carbon content of the upper 10-15 cm grow, the carbon stocks in deeper layers are likely to be depleted because the lack of mixing means no new carbon is moved downwards. It is therefore overall unclear whether no-till farming leads to a net carbon enrichment.
To ensure that a certain farming measure contributes to soil carbon uptake it must be adapted to the topography, soil type, nutrient dynamics, erosion risk and water supplies in the area.
A higher humus content in soils is known to have several other benefits, such as increased fertility, better nutrient storage, improved water storage and less erosion. The measures that can increase soil carbon are generally also good for biodiversity and for making land more adaptable to climate change.
How is it measured?
Measuring the carbon content of soil is complicated, and there are different ways to determine carbon levels over time, which also depend on the kind of soil. The standard technique uses a dry combustion method to determine total soil carbon as a percentage. To measure the development of soil carbon content, the samples must be exactly located and taken at the right depth and time to ensure comparability. Variability, uncertainty and potential errors arise from the fact that the distribution of soil carbon content differs even within the same field or plot, as well as from other sampling mistakes or lab errors. Existing frameworks for carbon farming certificates deploy a wide variety of approaches to quantifying the amount of carbon removals, the European Commission says.
It can take between three and five years before an increase in soil carbon can be detected.
The European Commission acknowledges that measuring and monitoring carbon farming results to ensure that it unambiguously removes carbon from the atmosphere is one of the major challenges of implementing such a scheme. It says that robust monitoring, reporting and verification of carbon removals is necessary to ensure the authenticity of carbon removals and minimise the risk of fraud and errors.
In what ways could farmers be rewarded for carbon farming?
The European Commission says that carbon farming is a future business model for farmers.
Its 2021 communication suggests that rewards would be paid to farmers via a trading system for certified carbon removals (other carbon removals, such as from CCS or direct air capture and storage would be part of this market too). Carbon farming credits would become an additional product that land managers can sell. Buyers would consist of companies and individuals that want to financially contribute to more climate action on the land and to offset their own unavoidable emissions, the Commission writes. For this system to function, actual carbon content developments would need to be determined in farmers’ fields and calculated to be represented as a carbon removal credit.
Alternatively, farmers could be rewarded for applying certain land management practices (see promising carbon farming measures, above) that are known to increase the storage of atmospheric carbon. In this case, a continuous monitoring, reporting and verification system would be less crucial. The existing subsidies paid to farmers under the European Union CAP already include payments that are conditional on pursuing certain best practices or additional farming measures that are beneficial to climate and biodiversity. In part, these measures are the same as those recommended for humus build-up.
What problems and concerns are connected to practicing carbon farming?
The biggest issue with carbon farming is that it can be easily reversed. After a soil’s carbon content has increased over some years, it can be released if carbon farming measures are stopped, mistakes are made when farming a plot or farming techniques are changed. If not continuously pursued, carbon farming is not a permanent way to remove CO2 from the atmosphere.
When paying individuals or companies to pursue emission reductions that other entities can use to offset theirs, there is always concern over the so called “additionality” of such measures (for example carbon farming). On the voluntary carbon market, a project where a farmer generates CO2 removal credits for the carbon she or he sequesters in their fields, must prove that the CO2 would not have been stored without the money from the certificate. So only those measures that the farmer would not have carried out anyway can be subsidised via the market. “But this can hardly be guaranteed, as farmers also carry out humus-building measures for their own motivation, for example for environmental reasons or as a climate adaptation measure,” says Carsten Paul of the ZALF.
Sebastian Lakner, professor of agricultural economics at the University of Rostock, also points out that because of the many co-benefits of more humus in the soil (such as more fertile fields, better water storage, less erosion) additional support via the EU’s agricultural policy would be “absurd”: “It would support a goal [keeping the soil healthy by humus build-up] that is actually prescribed by law [Bundes-Bodenschutzgesetz] and that farmers, if they manage their land sensibly, want to achieve themselves anyway.”
3. “Leakage” – transferring organic material
When undertaking carbon farming, land managers must be careful to not simply move organic matter (and with it, carbon) from one field to another. Only if biomass is left on the same field – or brought back to the same field in the form of manure or digestate – will an overall increase in carbon stock occur. If, on the other hand, biomass is moved from another piece of land, then the additional carbon intake in the “carbon farmed” field means the simultaneous depletion on the other field where the organic matter is now lacking. "This would be pure redistribution and not additional carbon sequestration," says Sandra Spielvogel from the Unversity of Kiel. The same problem arises when a farmer practices carbon farming techniques on some of their fields, but then cultivates the rest of their land in an even more humus-depleting fashion.
4. Fairness issues
The amount of carbon that soil can store is limited. This means that the effects of carbon farming measures are greatest in the beginning, but then carbon accumulation decreases over time. Eventually, the farming practices remain necessary for maintaining the carbon content but will not increase it anymore. But this also means that more carbon-depleted soils have greater potential for increasing their carbon content and, in a market for certified tonnes of carbon removals, would generate more income for the farmer. Farmers who have already been managing their land sustainably and in a humus-conserving way for years would thus benefit less from such a scheme.
5. Measurement and standardisation issues
As described above, measuring and monitoring soil carbon content is difficult and error-prone. Private schemes use different benchmarks and rules to arrive at the carbon credits that are sold on the voluntary market. But to establish a market for carbon removal credits generated by carbon farming (and other removal techniques), the standardisation of the sequestered carbon has to be watertight. Otherwise – both researchers and the European Commission point out – buyers will be hesitant to buy such credits, farmers will have a hard time estimating potential revenues from carbon farming, and policy makers will be reluctant to include the removal credits into the regulatory framework for carbon trading.
6. Target conflicts
There are generally many co-benefits to carbon farming, for example in biodiversity, water storage and erosion prevention. But some farmers have said that if they were to use a no-tillage technique on their fields, they may have to use more pesticides such as glyphosate instead, because less tilling means more pests.
Is carbon farming greenwashing?
As with all emission offsetting and the trade of credits that represent avoided or removed CO2, there is concern that buyers of such certificates use them to continue their existing business models, offsetting instead of reducing their own emissions. This greenwashing potential of carbon offset schemes, including the use of carbon farming removals, can only be prevented by sticking to a strict “avoidance first, removal last” hierarchy. In addition, robust monitoring, reporting and verification of carbon removals according to set standards are key, and permanence of the measures must be ensured.
When generating and trading carbon credits in Europe, there is also the danger of double counting the same emission reduction. Because European countries have set themselves economy-wide greenhouse gas reduction goals and have included the uptake of CO2 in carbon sinks (such as forests and soils) in their calculations, they would count any greenhouse gas reductions through carbon farming in their national carbon budgets. So if for the same CO2 sequestration, a certificate is sold to a company which then also uses it to claim an emission reduction or even climate-neutrality, then the same tonne of removed CO2 would be counted twice. NGOs therefore warn that in order to prevent double counting, corresponding adjustments (Article 6 Paris Agreement) would have to be made and that companies should in general be prohibited from claiming climate neutrality or net-zero targets.
Nevertheless, seeing as there will be residual emissions in 2050 that will need to be offset by carbon removals in other sectors, it is still very likely that establishing carbon removal technologies and measures, including ways of funding them, will become part of the EU’s climate neutrality efforts.
How do different stakeholders position themselves vis-à-vis carbon farming?
For the listed reasons and uncertainties of carbon farming, many researchers (see above) are doubtful as to how a verifiable and trustworthy market for carbon farming certificates could be established. (For the position of the German government and the European Commission, see above.)
Martin Häusling, spokesman on agricultural policy for the Greens/EFA group in the European Parliament, said in a Twitter debate: “Carbon credits are a shaky instrument: measurements inaccurate, C-stability questionable, humus pioneers disadvantaged...”
EU farmers’ association Copa-Cogeca said in the same debate that “Carbon farming represents an interesting and unique opportunity as no other sector can store carbon as naturally and efficiently as farming can, while still producing quality food. But, it's not a golden ticket or THE solution for climate change at farm level.”
The German Farmers’ Association DBV has stressed that carbon farming should not be included in the measures under the Common Agricultural Policy (CAP). To ensure its widespread implementation, it would be necessary to finance carbon farming by additional funds, such as from emissions trading and “by giving greater consideration to private providers”, the DBV wrote in December 2021.
Another German farmers’ association, the Working Group for Rural Agriculture (AbL), rejects the “proposed financing system via private-sector emission certificates”, chairwoman Elisabeth Fresen said. While adding that the AbL expressly welcomes the fact that farmers who work in a climate-friendly manner in their stables and fields are to be rewarded, she said the focus of a trading system as proposed by the European Commission would not be on farming or emission reductions but rather on the possibility for companies to buy emission compensations.
Where has verified carbon farming been tried?
The European Union is pursuing several carbon farming pilots across the EU in order to generate more data and insights into the potential of the measure and the issues around monitoring, reporting and verification. Another carbon farming pilot is run by chemicals giant Bayer.
Swedish and German rye farmers are participating in a three-year pilot by crispbread maker Wasa and US agricultural firm Indigo, changing their farming techniques to enable humus build-up and measuring the results. Offset certificates standard setter Verra has provided the project with an accounting standard for quantifying greenhouse gas emissions reductions and soil carbon storage.
There are also independently operating carbon farming schemes in Europe that generate removal credits sold on a voluntary market (e.g. Agreena in Denmark, Climate Famers and Carbocert in Germany). They offer farmers advice on how to increase the carbon content of their soil, including measuring tools and services and the generation and sale of carbon removal certificates.
What are the next steps towards implementing carbon farming in Europe?
2022 is the year of setting the stage for carbon farming in the EU. By the end of the year, the European Commission wants to present a proposal for an EU regulatory framework for the certification of carbon removals. To that end, there will be a conference on sustainable carbon cycles and the upcoming legislative proposal for the certification in the first quarter of 2022, an impact assessment, and an open public consultation.