A group of dairy farmers, Wij.land and Rabo Carbon Bank are starting a pilot project to generate and sell climate credits. The trial runs for three years and is designed to give farmers a source of income and accelerate the transition to more sustainable agriculture.
Dutch farmers manage half of the land in the Netherlands. With the right support, agriculture can play a critical role in tackling climate change in the Netherlands by preventing carbon emissions and sequestering carbon into the ground. A new carbon farming pilot, supported by Rabo Carbon Bank – the first Dutch bank to enter this market – will finance several climate-smart measures at a large-scale. According to Barbara Baarsma, director of Rabo Carbon Bank, “Farmers hold an important key when it comes to realising climate gains. I am proud that we in the Netherlands are one of the first to take this up. This is the future of our agriculture.”
Carbon farming creating extra revenue
With the pilot project, there are two ways for farmers to achieve climate benefits: first, carbon is sequestered in agricultural soils and perennial crops. Farmers do this by increasing the organic matter content of their soil, for example by adding compost or adopting no-till methods. Such practices improve soil health and allow more CO2 to be absorbed in the ground. In fact, the right farming methods can potentially sequester up to 1 million tons of CO2 per year in the Netherlands.
In addition, farmers can reduce their emissions by using less fossil fuels and artificial fertiliser or – specifically in peatland areas – by increasing the water level. The realised climate gain is then calculated and traded in the form of climate credits; allowing farmers to create extra revenue from the changed management strategies.
Learning and experimenting are central to the pilot
In this pilot, farmers choose from ten climate-smart measures on the basis of their own sustainability plan. Monitoring – funded by Wij.land and Rabo Carbon Bank – will discover which methods have the most potential (and at what cost). The team will also learn about the best ways to measure and the variables relating to soil type. Because different soils have their own characteristics and processes, meaning that the potential for sequestering or reducing greenhouse gases varies greatly. For example, the impact of spraying manure across peat soil is different from that in clay or sandy soil.
Besides the climate-smart measures, such as sowing herb-rich grassland, reducing the use of artificial fertiliser or applying compost, the entire carbon cycle (including grazing, giving feed, milking, applying manure) of the farm is taken into account. Danielle de Nie, director of Wij.land, says “every farm is different and has different opportunities to achieve climate gains. For Wij.land it is important that the farmer can follow his or her own path with measures that go beyond the law, and is rewarded for doing so”.
On the road to sustainable agriculture
The amount of credits is calculated on the basis of a model developed by Wij.land for the western peatland area. About 90% of the credit price ends up with the farmer, half of which is an advance payment. This is a new income stream for Dutch farmers and prepayment gives farmers more investment room to successfully adopt climate-smart methods on their farm.
Thus, carbon credits can play an important role in financing the agricultural transition, as well as supporting a resilient and profitable future for farmers in the Netherlands. “Climate farming or carbon farming is a way to farm more sustainably,” says Baarsma. “Some adaptations, such as herb-rich grassland and healthier soil, actually yield more money for the farmer after a number of years.”