The continued attention to carbon issues and ways to mitigate climate change may be creating new income opportunities for farmers. But how about a fertilizer retailer rewarding you for cutting back on nitrogen use.
The goal of the Sustainable Nitrogen Outcomes program, instituted by Nutrien Ag Solutions, is to generate Scope 1 emission reduction credits around the better use of nitrogen fertilizers in the field, says Sally Flis, senior manager for North America Sustainable Ag and Carbon at Nutrien.
“You hear about additionality with carbon markets,” Flis observes. “The additionality for this program is participating with a minimum 5% total nitrogen rate reduction.”
She explains that the program measures both commercial and organic nitrogen sources to look at the total rate reduction for the 2022 crop year.
To be eligible for the program farmers need to sign up with Nutrien by May 31.
Nitrogen emissions are considered considerably more potent than carbon in the atmosphere. Nutrien is working with Climate Action Reserve, a third-party verifier of carbon credits.
Flis notes there is a lot of information and carbon programs at work in the market. “We tried to take baby steps to figure out what the best approach is for us as an ag retailer, as a nitrogen manufacturer, for participating in carbon marketplaces,” she says.
This program is different than the carbon sequestration programs that require “additionality” changes to how you farm. In this case, simply documenting reduced nitrogen use generates a credit.
How program works
To be eligible for the different programs —corn, cotton and wheat — Nutrien has identified eligible counties for each crop in key states where the crops are raised. These are outlined on its website.
If you’re in an eligible county, you must achieve a measurable 5% reduction in total applied N, based on a three-year historical baseline. “The grower only needs to provide three years of previous nitrogen application rates and crop yields, and the cropping practices for the fields they want to enroll for the 2022 crop year,” Flis says.
She says this data requirement is lower than other programs, yet helps the farmer better understand the kinds of information these programs need. The grower will be paid based on the nitrous oxide emissions, in carbon equivalence, they reduce. “They can go as high as a 30% rate reduction in this program, but I’m not sure anyone is going to do that. We can model up to 30%,” she says.
The program will also add to the payment incentive if the farmer chooses to use Loveland Product (a division of Nutrien) that can reduce N use. This might include a nitrification inhibitor or some other nutrient management product. For example, growers could receive a $2-per-acre incentive to use AlturaBlack Label Zn on their corn. While not a nitrification inhibitor, it can help corn better utilize available N.
This is a one-year contract, which includes the farmer assigning the carbon credit to Nutrien. The farmer will also use Agrible, a proprietary digital sustainability platform, to track and provide data on nitrogen use on the farm and agree to be part of a verification process. The data requirement includes that three-year history plus information on cropping practices for the enrolled year.
This is a one-year contract, which stipulates the farmer:
- assigns the carbon credit to Nutrien
- uses Agrible, a proprietary digital sustainability platform, to track and provide data on nitrogen use
- agrees to be part of a verification process
The data requirement includes that three-year history plus information on cropping practices for the enrolled year.
The program provides an outcome-based payment using $15 per ton as the price for carbon. If the credit is sold for more, the added value is paid to the farm.
Flis says that a 5% N reduction would be between 0.05 and 0.2 ton per acre — so the max at that 0.2 ton level is a $3 payment per acre.
“It really depends on that combination of practices, on the location, and rainfall and weather data,” Flis says. “All that is taken into account as well. And the emission factors that were generated by the Carbon Action Reserve to calculate the emission reduction.”
She adds that while the payment may be small, the farmer gets an added benefit by cutting N by 5%. “And this is a real emission that never happened, which is a really cool way for us to start talking about this as well.”
The other benefit of this program is that even farmers who have no-tilled or used cover crops for years can take advantage of this program, showing they can reduce emissions.