Thursday, February 8, 2007 - 9:35 AM

Farm-Specific Modeling can Provide Better Value to Soil-based GHG Offset Buyers and Sellers.

Karen Updegraff, Patrick Zimmerman, Patrick Kozak, and P.V. Sundareshwar. South Dakota School of Mines & Technology, 501 East Saint Joseph Street, Rapid City, SD 57701

We have compared the results of soil GHG offset quantification using systems with three increasing levels of data requirements and customization. Currently the Chicago Climate Exchange buys GHG offsets from soil sequestration contracts estimated in at least two different ways: (1) using a generic sequestration factor based on regional modeling or (2) using the USDA's Comet-VR system to estimate soil carbon sequestration rates from "custom" modeling that is parameterized by selecting from a limited set of management and site-definition options. We compared the number of potentially marketable offsets estimated for a set of central and eastern South Dakota farm fields comprising roughly 3000 acres, using the generic factor, Comet, and a proprietary system, C-Lock, that uses site-specific soil, climate and annual management information. The estimates derived from C-Lock ranged from -350% to over 1100% of estimates made using Comet or the generic factor method. Over the entire sample, C-Lock-quantified sequestration offsets were 120% higher than the generic estimates and 640% higher than Comet estimates. Furthermore, the C-Lock estimates incorporate Monte Carlo-based site-specific uncertainty estimates as well as discounting to accomodate a regional baseline. Preliminary indications are that a system that allows farmers to account for field-specific and annually-varying crops and practices will more than justify the additional labor and information requirements by providing substantially greater potential income for the farmer and lower risk for the offset buyer.