Carbon offset markets are a winning issue no matter who controls the US Senate
As we look ahead to the 117th Congress, many have been speculating as to what, if any, climate policy initiatives can achieve enough bipartisan support to make it through a divided government. Even if the Democrats are able to win both seats in Georgia’s special election in January and command the Senate thanks to Vice President-elect Kamala Harris’ tie-breaking vote, lofty progressive agendas like the Green New Deal most certainly have no path forward due to the narrow margins in both chambers.
To those who followed the campaign cycle, it may seem as though the GOP and Democratic parties are oceans apart on climate policy. However, if you look past the political grandstanding and partisan talking points, there is actually significant bipartisan cooperation happening on Capitol Hill on more obscure climate-related issues that don’t necessarily make national headlines.
One example is the growing momentum and interest in voluntary carbon offset markets in the agriculture and forestry sectors. The concept of a carbon offset market is straightforward: agriculture and forestry together are among the highest carbon-emitting sectors of the economy, accounting for more than 10 percent of all U.S. greenhouse gas emissions. However, by using certain conservation practices like planting cover crops, diversifying rotation, or using fewer chemicals and fertilizers, farmers and landowners can sequester carbon in the soil and remove carbon dioxide from the atmosphere.
These carbon-negative practices generate a “carbon credit,” which can be sold in a market to individuals or companies seeking to reduce their own carbon footprint. The buyers in the carbon market are most commonly large corporations and Fortune 500 companies that have undertaken voluntary initiatives to reduce their emissions. Microsoft, for example, has recently pledged to cut its emissions in half by 2030, and to remove all the carbon the company has emitted—either directly or indirectly—since its founding in 1975. Many other companies including tech firms and airlines have recently made similarly ambitious environmental commitments.
Buying carbon credits in an offset market makes these private sector commitments possible. As Michael Jenkins, the president and CEO of Forest Trends, explains, “Companies feel an urgency to reduce their emissions, but they can’t eliminate them internally overnight. Many are now using voluntary carbon markets to offset those emissions they can’t eliminate until they transition to new technologies.”
Bipartisan lawmakers like Sens. Mike Braun (R-IN) and Debbie Stabenow (D-MI) have taken notice of the booming private sector demand and enormous potential for voluntary carbon markets to reduce emissions and allow farmers to get paid for implementing climate-friendly practices. As farm income has taken a huge hit in recent years—both due to a trade war with China that eliminated access to foreign markets and the pandemic, which has reduced demand for agricultural products—an additional revenue stream for farmers that is not dependent on taxpayer subsidies would be most welcome.
Unfortunately, despite enormous potential, there remain challenges to ensuring that farmers can access the markets and in ensuring that carbon offset projects are actually yielding long-term environmental benefits. Because of high transaction costs and a lack of educational resources on how to participate in the markets, few farmers to date have taken advantage beyond large operations. What’s more, better tools are needed to measure soil carbon to the degree of scientific accuracy needed to ensure the integrity of the carbon offset.
To address these challenges, the bipartisan Senators have introduced the Growing Climate Solutions Act, a bill that is seeing a growing list of cosponsors and supporters on Capitol Hill. The proposal would make it easier for farmers and landowners to access carbon markets and solve technical barriers by establishing a Greenhouse Gas Technical Assistance Provider within the U.S. Department of Agriculture. It would also bring validity to markets by establishing third-party verifiers, certified by USDA, which confirm that emissions were reduced or carbon was stored.
Voluntary carbon markets are not a silver bullet to addressing climate change, but they are a significant step in the right direction. With the enormous private capital available for offset markets and growing momentum, it would be a shame for lawmakers to let the moment pass without providing the investment needed to ensure that carbon markets can indeed deliver long-term climate benefits.
Properly constructed, these markets are a win-win for the private sector, farmers and landowners, and the environment. Democrats and Republicans may not always agree on the science behind climate change or the role of government in combatting it. However, recent momentum on issues like carbon markets shows that there are plenty of common-sense solutions which both sides of the aisle can embrace. Regardless of who commands the Senate come January, this type of bipartisan cooperation will be key to efforts to combat climate change and ensure healthy air and soil for future generations.
Image credit: creeed
