About The Alliance

This low number is due to the fact that payments for the greenhouse gas benefits of climate-smart practices typically do not meet producers’ implementation costs, resulting in a financial loss. Producers lack the up-front financial resources to shift technology and equipment required to adopt climate-smart practices, or to take on subsequent yield risks, and they cannot pass costs on to consumers.

Climate-smart agricultural practices can deliver public environmental benefits with an “ecosystem service” value 400% greater than the value of the greenhouse gas benefit alone, particularly from water quality benefits in crops and air quality benefits in livestock. Paying producers at a rate that reflects the combined environmental values of climate-smart practices enables them to earn a reasonable return, which enables them to rapidly scale adoption and deliver climate-smart commodities.

This pilot project uniquely compensates producers with a payment that surpasses costs and reflects the combined public value delivered by stacked environmental benefits.

Productivity-enhancing practices may have adverse environmental impacts; however, including climate and environmental goals is achievable. This project will draw on insights from Virginia Tech’s seminal Global Agricultural Productivity Reports© to deliver recommendations on integrating productivity considerations within our climate-smart pilot program.

Private market programs often require administrative burdens that prevent equitable access for small and limited resource producers, which includes the majority of socially disadvantaged producers.

Our pilot demonstrates an equitable program by:

• easing the administrative burden on producers;
• offering minimum payments and equity payments to address historic discrimination;
• tailoring outreach to underserved communities; and
• evaluating how to support limited resource producers in using the Carbon Management Evaluation Tool (COMET)

The Alliance will also form a Diversity, Equity, and Inclusion Committee, including relevant Tribal representatives, the National Black Growers Council, and invited members of at least one young farmer organization, an indigenous representative from a national livestock association, a female small dairy operator, a young, small-scale, LGBTQ producer, a national corn association leader, among others, to represent underserved producers.

The Alliance pilot will test a program model to verify and measure total and net greenhouse gas benefits, enabling the private sector to purchase climate-smart commodity certificates and claim additional investments using average net greenhouse gas reductions. Early adopters would be fairly compensated by the program, both gross and net impacts would be reported, and private sector actors will claim only the net impacts to meet their reporting needs. This model also resolves supply chain barriers by separating the certificate from the need for chain of custody tracking. High-end estimates of private-sector market carbon farming are only $5 billion, while the cost of national adoption of climate-smart practices is approximately $50 billion.

Additionally, the pilot will conduct research on consumer willingness to pay for various climate-smart labels to help assess the size of the private market and label effectiveness.

Very few producers have experience with COMET-Planner and this pilot aims to identify what support producers need in order to use the tool effectively. The pilot will use several approaches to inform types of support needed, including outcome evaluation comparing COMET-Planner and COMET-Farm and interviews of participating producers.

Economic incentivization of climate-smart livestock management requires specific consideration due to:

• the unique variability in investment associated with mitigation options (e.g., cost of feed supplements vs lagoon covers);
• the trade-offs among environmental impact, animal productivity, farm profitability, and other sustainability metrics such as consumer acceptance and animal wellbeing; and
• the need for farm-specific planning and evaluation of effective, appropriate, affordable, and timely mitigation strategies

To account for these challenges, a Livestock Working Group will be established in Minnesota and Virginia to implement high-value and high-cost climate-smart practices in Animal Feeding Operations (AFOs).  This sub-pilot will be launched in 2024.