Soil Carbon Measurement, Management, and Marketplaces

Soil health is the foundation of a thriving agricultural ecosystem, and soil carbon is vital in maintaining this vitality. As the primary component of soil organic matter, carbon is responsible for the water-retention capacity, structure, and fertility of soil – all crucial elements for optimal crop growth and yield. However, to fully capitalize on improved soil carbon storage benefits, a more comprehensive understanding of how to measure, manage, and standardize this vital element is necessary. In our Soil Carbon Measurement, Management, and Marketplaces Deep Dive, we investigate these challenges and explore how the market adapts to support soil health across these critical areas.

In this in-depth exploration, we are joined by a panel of industry experts, including Ray Riley from Soil Carbon Co., Chris Harbourt of Indigo, Paul Gambill of Nori, David Stanko with Nutrien, and Russ Conser, CEO of Blue Nest Beef. Together, we discuss the latest innovations and best practices in soil carbon measurement, management, and marketplaces, shedding light on emerging trends and opportunities in the field.

Our conversation covers the most recent advances in soil carbon measurement techniques (MRV), providing insights into how technology enables more accurate and efficient soil health assessments. We also delve into the importance of effective soil carbon management, examining the strategies and practices that farmers and land managers can adopt to maximize soil carbon storage and promote sustainable agriculture.

Additionally, we explore the growth of carbon marketplaces and their potential impact on supporting soil health initiatives. By creating incentives for responsible land management and carbon sequestration, these marketplaces can drive the adoption of sustainable practices and ultimately improve overall soil health and productivity.

Join us in this informative Deep Dive as we explore the critical role of soil carbon in agricultural success and the innovative solutions being developed to support healthier, more productive soils.


David Yocom: Good morning and uh, welcome to IS Select’s Deep Dive webinar series. My name is David Yoakum. I’m an associate here on the IS Select Fund Ventures team. I’m excited to walk you through today’s presentation and findings. For those of you who are new to these webinars, is Select is an early stage venture capital firm in St.

Louis, Missouri. Focused primarily on early stage companies in healthcare and agriculture. Uh, at is select, we are privileged to live at the forefront of innovation, seeing emerging problems, solutions, and macro trends at their beginning, before they make their way into popular culture. We use these deep dive presentations not only as a way for us to better engage with and understand new science and technology, but also engage with the experts in entrepreneurs who are driving change and innovation in their respective fields.

One such macro trend we’ve been researching is soil carbon and understanding its role in helping agriculture fight climate change. Agriculture is a major contributor to to global greenhouse gas emissions. Enter pricing. Estimated 10 to 15% of global, global GHGs every year, depending on the life cycle and scope of that analysis.

As such, the industry has come under fire for its contributions to environmental degradation, and significant resources have been expended to develop tools, technologies, and markets fix this Internationally there’s increased focus on ways to decarbonize agriculture and industry generally, uh, not only to reduce emissions, but to store carbon that has already been emitted.

Soil is now seen as a core tenant in the strategy for removal and storage of atmospheric carbon and soil has 3.1 times more carbon storage potential than the atmosphere itself. Fortunately, agricultural methods that improve soil carbon typically improve soil health overall, which have both environmental and agricultural benefits.

To properly incentivize the storage of carbon and soil and the emissions reductions in agriculture, proper incentives must be set, which has led to the development of marketplaces that allow farmers to sell carbon credits. The buyers that want to offset, uh, their emissions. As these marketplaces have come online, robust methodologies and protocols have been developed to standardize how carbon is quantified, uh, through comp.

Though comprehensive improvement to measurement and management are needed to continue to build trust in soil carbon markets and the opportunities around them. Regardless, this movement is already well underway. In this month’s deep dive, we’ll explore possibilities for agricultural soils as a car major carbon sink, along with technologies, methodologies, and markets that will be needed to stand up the development of this tool in the fight against climate change and the movement towards a healthier and more prosperous food system.

So for these reasons and many others, which we’ll cover in today’s webinar, soil carbon is of increase in interest, select in our, in our network generally. A few process comments before we begin. We are not soliciting investment or giving investment advice in any way whatsoever. This presentation is general industry research based on publicly available information.

We’ve invited you to this because you are technologists, thought leaders, entrepreneurs, industry experts, early adopter customers or sophisticated investors that are part of the I Select Network. We valued your thoughts, questions, comments, and insights into this topic and would greatly appreciate it if you actively engage during the presentation.

Thank you in advance for your attendance and active participation. We ask that you put yourself on mute for the time being. However, we hope this will be an engaging, interactive presentation. So if you have questions or comments, please feel free, uh, to jump in, um, typing questions into the q and a box or into the comments section.

We typically will re reserve questions like this towards the end, and we’ll have dedicated time for you, either ask questions of me or to ask questions of our panelists. Um, who will be, uh, speaking today. Finally, this presentation is being recorded and will be available for replay. And so with that, I am pleased to bring you this week’s deep dive on the role of soil carbon in agriculture, climate change, uh, and mitigation, uh, methods.

So just to give a sense of the agenda that we’re gonna cover today, we’re gonna get some brief intros from the speakers that we have on today. Really excited about the, the group that, that has joined us. A lot of really interesting perspectives and a lot of deep knowledge from this group of people, from a variety of backgrounds.

And then I’m gonna give a little bit of background on soil carbon, some baseline definitions to bring everybody up to speed. And then from there, we’ll, we’ll jump into sort of where the industry is today and highlight some of the work that’s being done, particularly on technologies that are improving the way in which we manage, measure, um, and market soil carbon.

And then finally, we’ll, we’ll have sort of a, a wrap up with the end, talk about the thesis, some of the key considerations moving forward out of this presentation. And then we’ll also have a, a section for questions from our speakers, should there be any time, uh, available following. So, uh, I’d love to kick things off, which is some brief intros from, uh, our speakers and panelists today.

Again, really excellent distinguished group and really excited to hear their thoughts. It’d be great if we kick things off with Ray and then Chris, Paul, Dave and Russ, and then we’ll, we’ll dive into the presentation.

Ray Riley: Hi, Ray Riley, the North America Lead for So Carbon Code, which is a, a Australian startup.

My background is in plant breeding and biotech was a corn breeder with Pioneer and, uh, then worked with Syngenta for about 15 years, was at Indigo for three and a half years. Senior VP of product development and now leading the startup of e r D platform in North America, as well as partnering on the overall soil carbon co activities globally.

Paul Gambill: Excellent. Thanks Ray. Chris. Good morning

Chris Harbourt: everyone. Chris Har. I’m the global head of Carbon for Indigo, working there for about over a year. Been leading the program there and then thinking forward about where we’re headed. Just we’re in the second year of our program and really excited to, to be talking about it today.

My, my background’s agricultural engineering and I’ve spent a lifetime in agriculture in the, uh, startup world and then also in. Science consulting in, in in agricultural supply chain. Paul, good morning.

Paul Gambill: My name’s Paul Gamble. I’m one of the co-founders and the c e O at Nori. And Nori is a, uh, carbon removal marketplace startup.  We found it, we were founded in, uh, 2017. We have been focusing for the last several years on creating robust and standardized methodologies for, uh, measuring and verifying soil carbon. And we are live today working with farmers in the us.

David Yocom: Excellent. Thanks Paul. Dave, good

David Stanko: morning everybody. My name’s Dave Stanko.

I’m the head of ag tech engagement for Nutrient, where I lead our partnership and investment activities with early stage ag tech companies and venture funds. With a recent focus on technologies that can accelerate our carbon strategy, which we, we announced late last year, uh, 2021. We’re focused on multiple pilot projects using, um, a variety of different protocols that are available today.

And we’re really looking to be able to scale our, our capabilities in 2022. So appreciate you guys having me today and really looking forward to the discussion.

David Yocom: Excellent. Thanks Dave. And, uh, last but certainly not least, Russ. Hi, Russ Conser,

Russ Conser: I’m calling from Houston, Texas. I absolutely have no long-term background in agriculture.

Up until about eight years ago, I come out of the fossil fuel industry where I spent 30 years at Shell taking dead carbon out of the ground. I came into this business through the soil, carbon science, and as strange as it sounds, I’m now co-founder and c e o of direct-to-consumer grassed beef company that’s using the face of birds in a partnership with the National Audubon Society to bring a product that’s actually helping something that’s both an objective and a surrogate for soil, carbon and other ecosystem benefits of regenerative agriculture and getting consumers engaged in that story early while we work harder to get the quantitative, robust, uh, rigorous, uh, measurement systems in place to do this more rigorously.

David Yocom: Excellent. Thanks Ross. Well, thanks to all our speakers. I’m looking forward to hearing, um, all of your thoughts and insights today. Um, let’s go ahead and jump in. So what I wanna kick things off is just take everybody a little bit back to either their high school biology or, uh, environmental studies or maybe, uh, freshman year of college, undergrad, um, uh, environmental science class, um, to talk a little bit about the carbon cycle, um, and just set some key definitions for the kind of conversation that we’re gonna have today.

So everybody’s on equal footing. So, uh, when we. Talk about carbon today, we’ll be speaking principally around this idea of soil organic carbon, creating a, a distinction here between organic carbon, which is fundamentally derived from living and dead organic matter, uh, that inorganic matter, inorganic carbon, which comes from these mineral farm forms of carbon, typically due to weathering, um, or interaction with co2.

So two distinctly different types of carbon that can be present in the soil. When we think about soil organic carbon, we’re thinking about a component of the total soil organic matter in soil so that soil is this complex component of Mexican components of, of water and air and minerals and organic matter where that organic matter can be, you know, anywhere from as low as 0.5% up to sort of 5% in healthier soils.

It’s this combination of, of aspects that fundamentally give, uh, plants and life their nutrients, um, that is, is a distinguishing factor of what we would consider to be healthy soils. Soil organic carbon is the measurable carbon component of that soil organic matter. We’ll talk about how that’s measured going forward.

It is generally speaking, you know, can be as much as sort of 58% of total soil organic matter, which overall is a smaller component of, uh, soil generally. But I just wanna make sure that we have a good understanding of sort of those core definitions as we proceed through the conversation today. And I wanna bring everybody back to sort of an understanding of the carbon cycle and the, the means by which that, uh, carbon is either emitted, um, into the atmosphere or, and then, and then recycled back through the soil, um, and into the ocean typically through, primarily through means of photosynthesis, uh, or facilitated by microbes and other microorganisms.

Um, and then deposited by animals back into the soil as well, and then released through respiration. And also at to quite a large extent, as we’re all aware through human activities. And then the final distinction I would point to in the bottom left corner here just sort of talks about the different types of, of soil carbon that exist and the timetables by which it takes them to form where there are sort of more surface level forms of organic matter, uh, and soil cor carbon that form over shorter periods of time, and then deeper, more resistant and less likely to be recycled forms of organic carbon that form over hundreds or thousands of years.

And so when we think about soil carbon, there’s sort of a fundamental relationship that is just important to identify as fundamentally, when we think about what defines a healthy soil, it’s a soil that’s rich in soil organic matter, and soils that are rich in organic matter are also rich in soil organic carbon.

And so typically, and, and obviously this varies from where you are in the world in climatically and in different soil types, where there may not be as much of a capacity for the storage. Of rich organic soils or for the accumulation of carbon rich soils. But as a general principle, it is generally considered true that soils are rich in soil organic matter are are healthier soils.

And so when you have an increase in soil organic carbon, you have a means by which soils hold more water. They can improve crop health and yield, they can improve nutrient availability, biological activity, diversity, and overall productivity. And so this is sort of a key feature that I think will be prevalent throughout this conversation today, is that we talk a lot about the, the means by which soil can be a way to store carbon in fighting against climate change, but that there’s also a positive externality there when you’re thinking about climate change and how many negative feedback loops.

It’s nice that there’s, at least in certain instances, a positive feedback loop potentially in this case where the carbon has other, um, positive attributes to it. So in terms of the way that. Soil carbon fits into the picture of some of these global challenges. There, there are a number of them, but I frame it mostly in these three buckets, at least for this conversation, thinking about it from a soil loss and erosion standpoint.

Um, and that soil loss can cost us corn farmers up to 500 million each year. Um, some estimates might even put it higher. And that fundamentally, when you have richer soils, richer in organic matter, or richer in in carbon content, that you fundamentally have better structure and benefit from reduced erosion due to climatic events or other factors that might cause soil degradation.

These fundamentally make agro ecosystems more sustainable and more resilient. And then with the context of, in the context of climate change, one of the really interesting opportunities is, and we’ll talk about this more in the next slide, is about the scale that soil presents. So we’ll talk about some of the, the pros and some of the drawbacks of biological systems and how they.

Can play a role,

Paul Gambill: a really important role in, in fighting against climate change.

David Yocom: But really the exciting aspect here is the, the pure scope and the size of a tool, um, like soil for carbon sequestration. And then finally, the, we’ll get into more about methodologies, but there are pr agricultural practices that can be undertaken, that have a means by which they store more carbon in the soil and reduce the

Paul Gambill: disturbance of soil that would

David Yocom: cause release of carbon in the atmosphere unnecessarily.

And then a lot of times these practices, whether it be no-till, low till, uh, cover crops, reduction of nitrogen fertilizers, these all in the grand scheme of things have external environmental benefits and positive externalities, uh, that play a role in society for farmers and, and for others, which is why it’s important that we’re having a discussion about, about marketplaces later in this conversation, putting this all into context, thinking about soil as a carbon sink.

You know, through the research that we did prior to this conversation, the two main advantages I saw were really about this size and, and some of these numbers we’ve already talked about today is sort of this, this fact that soil has more than three times the capacity of the atmosphere to store carbon, which is a really exciting opportunity.

And that when you think about all of the, the carbon that’s stored in terrestrial organisms or in, or just terrestrial carbon, 80% of it’s found in soil as opposed to plants, et cetera. And so it’s responsible for holding a lot of the carbon that is in the carbon cycle today. And then as we mentioned, some of these positive externalities, they include, uh, rich organic matter, reduced runoff, higher agricultural fertility, and better water holding capacity.

Some of the drawbacks and, and the illustration here on the right shows this a little bit, are

Paul Gambill: around the way in which,

David Yocom: obviously because soil is biologically active and it participates in the carbon cycle, is that. Carbon stores in soil are constantly in flux. And depending on the time of year from which you’re taking a measurement, you may get one read one time of the year completely different from another time of the year.

The, the challenges of measurement and and management are important in this context because while soil on the long term, so let’s say the hundred thousand of year scale will catch the capacity to sequester more carbon than from the atmosphere, than it admits during various periods, it may be flexing more or less than it would be in other periods.

And so that makes it challenging from a measurement and management standpoint, particularly when we’re talking about specific thresholds of carbon emissions and trying to improve carbon, uh, sequestration. And that that also speaks to the, to the variance aspect here listed. Um, on the bottom, before we sort of jump into the next sort of sections to talk a little bit about, a little bit

Paul Gambill: more about where.

David Yocom: How we manage carbon, how we measure carbon, how we’re building markets around this idea of soil as a carbon sink. I wanna pause here and see if there’s any comments, uh, from the, from the speakers. Is there, if there’s anything they’d like to add before we jump into that, into that

Russ Conser: section. Yeah. At the risk of opening up a, a, a can of worms, but maybe bookmark for future conversations can of worms is welcome.

Is this question of permanence is one that I think nature-based solutions like soil carbon, have to participate in a conversation with other people participating in the market to more deeply understand. I think what we really care about is that the total pool of carbon is growing that. Is, but, but I think we have some misunderstandings of what we’re trying to do.

There’s this word sequestration, right? And a lot of people say that they wanna lock it up, but what we really want with soil carbon isn’t permanence, like locking it in a vault. What we want is a lot more carbon being put to work in the biological economy that’s helping grow food and crops in a system.

So it’s kinda like looking at the M one money supply money and circulation versus Golden Fort Knox type thing. And I, I think it changes the conversation about permanent. So how we address that in both voluntary and regulatory systems is an open question. Uh, but I, I, I think it’s more complicated than people think it

David Yocom: is.

Yeah. That’s a great point, Ross. Great. So what we’re gonna start off with in this next section and, uh, really excited to get some more thoughts from speakers throughout the, the rest of these slides here is really around measurement management and some of these markets. Um, Which really sort of set the footing for where the opportunities for so carbon are in the future.

And we’re gonna start things off with, with talking about measurement. So this was a, a really fun exercise of breathing, uh, putting together this slide and, and some of the research of, of reading, um, through some of the, so protocols over the weekend, which was, uh, certainly a, a riveting exercise. Um, I appreciate how robust they are cause these are extremely, uh, dense, dense documents.

Um, and provided a, a huge amount of detail on, um, the ways in which soils can be, can be managed. Um, but fundamentally when we think about measurement of actual carbon, um, the, the sort of still the gold standard today is still, uh, soil sampling. Um, and using common methods like dry combustion analysis essentially to take dry soils, uh, and burn off, um, the carbon and then re weighing those soils.

To capture the difference, um, between the, the new measurement and the old measurement, um, to understand how much carbon was in that soil, and then measuring that over, uh, a representative area in a field. Um, and then over representative periods of time for which carbon, uh, storage may change over, um, those periods of time.

And obviously, some of those advantages are surrounding direct is, is really fundamentally based in direct analysis, um, of those soils, and it’s fundamentally the most accurate way to measure carbon in a specific sample. Um, but some of the challenges for, uh, for soil carbon measurement can include, uh, labor intensiveness, particularly across a really large operation.

Um, additionally for a really large operation, how representative it it is of those soil conditions, the timing of when the sample is collected and, and particularly as climate variance becomes taken into account, you may not be seeing the same exact. Soil conditions in the fall of this year, as you may have seen in the fall of last year.

And so it makes it challenging to set a baseline. The other aspect that I’ll, that I’ll bring in here is this is not just about, as we start to think about carbon management on the farm level, it starts to become not just about soil carbon management, but also about general carbon emissions management.

And so you start to bring in some of these more modeled aspects. So we start to bring in, as you can see in the table in the bottom left, this comes from one of the soil health protocols that sort of discusses the way in which soil, organic carbon is directly measured. But a lot of these other, uh, a lot of these other carbon emissions or storage means are either modeled or calculated, not directly measured, which can create certain uncertainty because you’re bringing in high multiple models into, into an estimation.

So that can be one of, one of the, one of the challenges there. And then on the emerging methods, most of what I’ve seen, and I’m curious to know if the speakers have any other, Thoughts here has really been around applications of remote sensing. So bringing Hyperspectral imaging, UABs, flex Towers, ground penetrating radar.

We heard from a really interesting company recently that was using ground penetrating

Paul Gambill: radar

David Yocom: and

Paul Gambill: machine learning

David Yocom: as a means of calculating soil organic carbon at scale, which was a really exciting opportunity. And I think some of the advantages around that are really around greater scale, lower cost per acre of application.

You get faster feedback, you can get more in-season feedback, and there’s an opportunity for greater automation. But the disadvantage is being that it is potentially unproven in certain use cases. Uh, you really need excellent models and, and training data sets that need to be updated. And, um, and that can be a challenge in of, of itself, could be more expensive in some cases.

Uh, and, and it, and sort of fundamentally you’re looking at correlative non, um, direct measurements. Um, so with, with all these in with, with sort of the current methods and the emerging methods in mind, you know, Russ, you and I had a, had an interesting conversation yesterday. Just about your experience in the world of regenerative agriculture and, and thinking about measuring, um, soil carbon.

Is there anything that stuck out to you in terms of promising technologies that could help us improve soil carbon measurement, um, or G H D emissions and sequestration in general?

Russ Conser: Yeah. Well, I come out of the energy industry where we tend to think of as this phrase of all of the above, and we need to think of the same way when it comes to soil carbon measuring indeed, uh, lots of interesting possibilities and remote sensing.

But important to note what you pointed out there, that none are direct measurements, they’re correlative. That means we have to compare with ground truth in terms of emerging technology. There are entrepreneurs working on, on the ground, uh, sensor-based systems for measurement of soil carbon concentrations, either in samples or in probes that might go into the ground.

And one category of technology that I’m particularly intrigued about is a, is a class of technology called Eddie Co variance technology. Uh, which is very rigorously proven in the scientific field. Uh, think of it like a power meter, uh, for, uh, ag land that counts carbon going in and out of the ground all day every day instead of how much is stored in the stock.

The problem is right now it’s very expensive and you pretty much have to have a PhD to run it and analyze the data. So entrepreneurs that can reduce the cost and simplify the process of doing that edco variance technology, I think that could be a real kind of nucl leading technology to pull some of these other sampling modeling and remote sensing systems together and give us more economic ways to confidently track carbon in time and

David Yocom: space.

Great. Thanks Ross. And then, you know, I would ask Chris, Paul, and Dave, just based on, you know, the, the roles that you have and the connections that you have to farmers and the, and the fact of the matter is that if you’re standing up a, a carbon. Carbon market measurement is so important to trust on both ends.

Um, and so I’m curious to know if, if any of you have sort of, you know, either for your own organizations or for the farmers that use your market services, you know, sort of what’s on, what’s on your technology wishlist for, for better sensing and better measurement going forward? Yeah, I’ll, I’ll kick

Paul Gambill: this off.

So our, our perspective at Nori is that, um, you know, some of the issues that you mentioned are, are absolutely true, especially when it comes to soil sample testing. And in terms of the, uh,

David Yocom: reliability

Paul Gambill: of that over time. Like, it’s not just as simple as measuring, uh, one, you know, the same field, uh, repeatedly over different years.

So, We’ve been taking the approach of how do we get this going now in a way that’s trusted and reliable? And then how do we incorporate this new technology as these are coming out over time to improve the precision and accuracy and bring down costs. So we’re working with the team at Soil Metrics, which has spun out from, uh, comet Farm, that U S D A funded greenhouse gas accounting tool.

Which has a reference

David Yocom: network of soil sample testing

Paul Gambill: sites around the country, and then they layer the dataset model on top of that. That’s pretty much the best in class for what’s available today coming in the future, though, basically everything that you mentioned is going to be useful over time. And the real trick is how do we, how do we continue to layer that stuff in, into this modeled approach that’s taking into account various other factors like climate and different growing season, uh, stuff.

So that’s, that’s our approach. And by, by creating a, by creating a method today that can, um, actually drive revenues into this space that’s going to help fund the long term on the ground data calibration and, uh, ground true thing that, um, that Russ was mentioning. Great. And Paul, just, I I would just one,

David Yocom: one quick follow up there as you.

Sort of thought about what types of models you wanted to incorporate into Nora’s methodology, how, how much variance do you typically see between different, different models that you might use? I mean, was it significant enough? There’s,

Paul Gambill: there’s only one model, right? That, uh, COMHAR is the only open source peer reviewed model out there.

Um, there are, there are others that are right, um, trying to catch up. But, um, you know, we’re, we’re only going to work with, uh, platforms that are open source and peer reviewed in that common farm.

David Yocom: Um, thanks Paul. Um, uh,

Paul Gambill: Dave, Chris, any, any, uh,

David Yocom: tech, any items on the technology wishlist that, that you guys would want to

Paul Gambill: add here?


Chris Harbourt: sure. Uh, David, just to talk a little bit about where, you know, I’m trying to focus on the slide you have here about remote sensing. There’s a lot of promising technology out there and you know, Russ mentioned the whole issue of ground truth and the correlations needed there. What, when we think of this, and Russ, it’s actually to one of your earlier comments about permanence.

Remote sensing is really an excellent tool as we think about guaranteeing the permanence. When we look at the registry approved methods, the real high quality credits, we’re looking for a hundred year permanence period. And at some point, those credits transfer outta the programs into a monitoring period and remote sensing technology of today and what will develop over the next few years offers a really great opportunity for a low-cost measurement of that permanence long-term.

So I’m looking forward to the technology there. As things mature, you know, we’re, we’re open to, you know, all sorts of, of innovation and thoughts. You know, when, when I break up the carbon world into four areas of, you know, what we’re talking about here is like the realness of the credits. So could you come up with a better mouse trap around the modeling or the soil?

That’s certainly an area additionality is the actual technology of what you’re doing to the ground, like the, the practice that a farmer would implement. There’s all kinds of opportunities there. We just talked about permanence and maybe the opportunities around how to beat the cost out of, out of that requirement of permanence.

And of course just the concept of leakage where you have to maintain the yields on the fields of today and, and not risk a transfer of that. Um, Yield capacity to an area that’s more sensitive environment than where you are. Um, so technologies that keep yields high or increase yields with on a smaller footprint.

All of those sorts of areas, I think are, are key components. So I, I try not to get too wrapped up in the modeling area. That’s a, that’s a piece of it, right? And we have to be excellent at it, and it guarantees the quality of the credit. But really this is a, a far bigger technology opportunity, um, across the whole, the whole kind of opportunity with the farmer and, and the, the technology company.


David Yocom: I think that’s a really good point, Chris, and it actually ties well into the, to the next section here. So, um, I’m gonna use that as a transition. So when we think about measurement, we, there’s also this aspect obviously of, of management. And so, um, there was a, a in, in, these are well documented in some of the protocols and also in any number of articles online means by which you can either store more carbon in the soil or reduce the means by which carbon is, uh, emitted on the farm by some other, by some other means.

Typically, methane or oxide are the other emissions that are considered external to, uh, carbon sequestration. Uh, and some of these methods include, uh, a agri forestry no-till, or the use of cover crops, improved crop rotations, reducing the use of substant nitrogen incorporation of. High carbon holding materials like biochar, the reduction of flooding and rice fields, which can reduce methane emissions using rotational grazing to reduce the damage on, um, gra um, on, uh, pasture lands.

And then reducing fossil fuel use are all means by which are all aspects of those models that can be brought into calculating what the, the effective carbon footprint of a farm is, which incorporates both soil carbon storage and just simply reducing emissions. Um, but there’s also some really exciting emerging methods.

And so with that, we have, uh, Ray Riley here from, um, soil Carbon Company, um, and talking a little bit about some of their work and using microbes as a means of, uh, sequestering more carbon in the soil while boosting yield and, and providing tools to farmers that make sense from an agronomic standpoint, but that also have substantial climate footprint.

So Ray would just love if you could give us an overview of Soil Carbon Company and what you guys are working on to bring microbes into the discussion to better suppressor carbon in agricultural soils. Um, and then we’ll sort of go from there.

Ray Riley: Sure appreciate the chance. So Saul Carbon is really, you know, leveraging a lot of work that’s been done over time, but really focusing on the systems biology, uh, and how we can think about the microbial community.

With more intensity than what we’ve done in the past. And so if you, if you look at the, the what’s been talked about in terms of the carbon in the soil, a lot of that’s the micromass from microbial communities. But a lot of that’s pretty labile. A lot of that’s pretty cyclical. And that relates to a lot of the points about the measurements over time, uh, you know, ranging and, and differing.

But there’s, there’s certainly parts of the carbon system that are very focused on creating more, more recal forms, uh, increasing the carbon sequestration in, in ways that it’s more intertwined into the, into the structure, into the mineral carbon. And, uh, you know, this is what soils have done over time to create the, the soil, uh, capabilities in the carbon, uh, capacities that are there today.

And so, how do we. Understand the microbes that are most capable of creating and, and contributing to the soil structure, to the mineral, uh, carbon components and to much more stable components of, uh, carbon. Looking at both the chemistry. And the structural approaches that the microbes, uh, take for instance, the production of, of compounds like melanin can have very long lives in the soil.

You know, depending on the way you look at a hundred to 300 years particularly of, of those things. And, and, uh, also the ability to sequester those within the soil structure and enhance the soil. Soil structure can be very contributory and, and allow for significant increases in soil carbon, while also focusing on some of the things that Chris was talking about in terms of increasing the productivity.

So you’re, you’re saving more, more, uh, susceptible soils at the same time.

David Yocom: Got it. That’s really helpful. Ray. Um, can, can you help us understand a little bit more about sort of the, the scale and the potential of microbial carbon sequestration? So, For example, for parts of the world that may have a huge amount of microbial soil activity and likely plant activity as well.

How do sort of naturally occurring microbes compare with trees and plants? Um, generally in terms of their carbon sequestration potential? Obviously it’s cyclical to a certain extent, so more microbial activity and the soil likely means that the soil is generally healthier. Plants are able to better facilitate photosynthesis.

But if we were to sort of compare and think about the scale of a solution like this, how, how, how could you compare that to sort of what’s naturally occurring right now?

Ray Riley: And I’m not sure I’ll have the, the best comparisons of those things. But thinking about the capacity of capability. So if you, if you look at things that we’ve seen both in, in validated, both in field and in greenhouse trials, uh, taking canola in Australia as an example, you know, we see the ability to increase, uh, carbon in the soil, uh, controlled experiments of 15% within one year, one growing season.

And to, uh, see that linked with increases, uh, in plant performance and yield of, of five to 10%. So getting the short term benefit while also building the carbon capacities. Uh, if you take that on a, on a Hector basis, uh, you know, that can be 10 tons of carbon, uh, sequestered. If you take that across.

Australia, uh, you know, that could be 5 million tons of carbon. And if you think about that across the planet, that could be, uh, 25% of the global co2. And so, you know, these are, these are systems that have significant capacity and are able to be validated and demonstrated. And, uh, the other thing that’s really beneficial is that these are, these are very applicable in traditional production environments as well as in the regenerative agricultural systems.

And so it’s really, it’s really, you know, going to the next level in terms of understanding systems biology and how soil over. Time became the, the tremendous carbon, uh, system that it is today. And as mentioned earlier, not only in terms of being a vault for carbon, but also being, uh, being a, an integrated system where carbon is part of the currency exchange methods to, to make nutrients available to increase, uh, water holding capacity to allow the plant to have extended, uh, access to, to the nutrients as well as contributing to that soil system that will benefit them long term.

David Yocom: That’s great. Um, super interesting. And, and one, one thing I’m, I’m curious about is, and this isn’t the first time that we’ve seen microbial solutions in agricultural generally, um, whether it be for improved fertilization, whether it be for crop protection, et cetera, um, I think, you know, there’s been an influx of solutions like that.

And so obviously you’re in a position where you’re looking to provide solutions that. Bring some of those traditional benefits, but also that are specifically positioned in this emerging soil carbon opportunity. Um, how do you think about sort of as you start to convey the work that soil carbon is doing to farmers, potentially users, whether or not they should be viewing this as a means by which they can better access soil carbon markets and the opportunities to generate that second revenue stream there?

Or if the value proposition should still be around improving crop yields and reducing the cost of their, of their fertilizer use. Do you have any thoughts on that?

Ray Riley: Well, we think it’s really both. You know, we, we think that it’s important that the grower see the short term benefits and so, you know, we, it, it’s really systems biology and it, it’s connecting things together.

So if you look at the, the offers that we’re putting together, they will include microbes that are really focused on what would has been developed in, in the microbial inputs into agriculture over the last decade, and really been accelerating in terms of those things that increase, increase plant performance, can allow the farmer to reduce inputs and get similar performance or better performance.

Uh, but then to also make sure we’re, we’re, you know, where we’re trying to differentiate where we are. Differentiating is focusing much more in terms of adding those components in there that have been less focused on, uh, you know, part of it’s, they’re fungi and there’s. There’s some challenges to that, uh, but, but are really critical in terms of the carbon, uh, economy and the soil and the integrated system, as well as the ability to sequester a lot of that carbon in a way where it’s, it’s, uh, you know, it’s much more embedded into the, the system in terms of, uh, creating the, the soil structures, creating the integration of the carbon within those structures and, uh, creating the, the forms of carbon that are much more recalcitrant.

Being recalcitrant doesn’t mean that it’s vaulted up and not utilized, but, you know, making sure that we’re creating this next, uh, next wave of opportunity there in terms of how the plant is working with the, the bun microbes, uh, as well as others to, to move to that next level in terms of carbon sequestration and in particular, more recalcitrant, longer term, stable carbon forms.

David Yocom: Excellent. Well, um, Ray, really excited about the work you guys are doing. Uh, appreciate you sharing it with us. Um, we’re gonna jump forward here at this next part to talk a little bit about soil carbon protocols and methodologies. I guess, Ray, the one last question I ever have for you before we jump there is, you know, as, as this becomes a tool to more accurately and consistently cap capture carbon in a, in a more recalcitrant way in the soil, um, have you guys had any conversations with any of the other protocols out there about how this would be incorporated into some of those methodologies and, and fundamentally how farmers would be able to measure this effectively to get paid for, for using products like this?

Ray Riley: Certainly, and you know, Paul is on the, on the panel as well. And so, you know, we’ve been working in terms of, uh, registration under the compliance methodology. Uh, at the moment at, at the Australian pilots are working with the Australian emissions, uh, uh, reduction fund. Uh, we’re also working with the traditional soil carbon methodologies.

But one of the challenges is that a lot of those really don’t have that depth of focus on the, the sustainable carbon, the stable carbon, uh, that, that, uh, can be enhanced in some of these new dimensions that I talked about. So we’re working to develop new approaches, you know, all the comments before about the multiple methodologies and the emerging capabilities are really important.

Uh, we think that those can be tied to this, uh, the ground true thing, I think to make them accurate in some of these dimensions will be additive. Uh, not competing against those things, but helping us look at that. And, you know, ultimately it needs to include the economics of the farm as well as the economics in terms of the carbon that we’re sequestering in the

David Yocom: system.

Excellent. Thanks Brad. Well, with that in mind, um, I wanna cover off a little bit. The next two slides are first one focused on the protocols and methods, and we’ll spend just a moment here just to sort of set a baseline as the slide would, would imply, uh, for sort of what, uh, these protocols and protocols and methods are, what’s similar about them, what’s different, um, which ones are, are being used by who.

And then we’ll talk a little bit about some of the marketplaces and highlight particularly our speakers who are representing some of those marketplaces today. Uh, and, and some of the opportunities and challenges that they’re facing. Um, but the key point that I wanna make here is really that there’s an evolving set of protocols and methods that describe the rigorous methods for how we effectively manage agricultural soils.

Um, these include are not limited to the Soil Enrichment Protocol, uh, the verified carbon standard U SDAs Carbon farm. Um, there are a number of other methodologies that are out there for managing and, uh, calculating soil carbon. Um, these protocols have evolved to, um, provide scientifically backed, rigorous, and yet actionable means.

It’s important that they’re actionable, uh, by which soil carbon can be measured, monitored, and calculated across a common standard. Um, essentially setting the rules for, for carbon management. And so, you know, one thing I just wanted to open up with a question towards, you know, Chris, Paul and Dave, because you know, one thing, and I’ll actually just transition to the slide just to sort of put it into perspective of these sort of three different programs.

Um, you know, how, how have you thought about what types of protocols you’ve chosen to work with? You know, indigo recently came out, uh, saying it would work with the Soil Enrichment Protocol and the verified Carbon standard. Norry has a partnership with the U S D A Common Farm and also has its own crop lines methodology.

And then Dave, for our conversation, um, uh, earlier this week, uh, you know, nutrient plans to fundamentally be, uh, uh, a protocol agnostic. And so I’m curious to know if there’s any, any comments from. Uh, from, uh, Dave, Paul, Chris, uh, on sort of how you decided to work with specific methodologies and what you’ve identified as sort of key differences, strengths and weaknesses between different methodologies out there.

I’ll start. Um, so for us, this began back in

Paul Gambill: about the beginning of 2018 and we’re looking at the landscape of different potential options available. And the comma Farm platform, as I mentioned earlier, is really the only reliable, uh, platform available for, um, US soil carbon. Estimation and verification.

And one of the things that we did was we looked very closely at the ways that the protocols

David Yocom: worked within the

Paul Gambill: traditional registries like Vera and Climate Action Reserve. And the, um, the verification and validation costs associated with each of those projects is, um, just enormous and, um, not sustainable for individual farmers.

And, and we wanted to also deal with the, uh, the problem of, um, for any, uh, ecological or nature-based, um, carbon offset project. The idea of 100 years of permanence is sort of afin. And when you look at forestry projects, for instance, the problem is that they’re only getting about 20 years of revenue, but then they have 80 years of further maintenance that they have to do to keep that carbon.

Paul Gambill: Locked up. So we wanted to come up with a, uh, different way of doing that that would really dramatically reduce the cost of, uh, verification. So that’s how we evolved our, uh, methodology to the point where we work with farmers who are signing contracts that say they’re gonna, um, keep that carbon to the ground for at least 10 years.

And then they have to re-verify every three years. And every three years when

Paul Gambill: we’re going through that re-verification, we’re able to issue new, uh, we call them NRTs. We’re able to issue new NRTs, the carbon credits to farmers at that point. And then they’re signing a new 10-year contract to keep that carbon in the ground.

So the, the farmers are continually incentivized over time. So what was a 10 year permanence becomes 13 becomes 16, becomes 19, and so on and so on and so on. And that’s just not possible, uh, to create this sort of new, uh, novel way of putting this together by working with the existing registry. So that’s why we decided that we had to build this ourselves from the ground up.

David Yocom: That’s really helpful, Paul. Um, uh, Chris, Dave, do you guys have, have any thoughts on, on the methodologies that you

Paul Gambill: decided to go with?

David Stanko: Yeah. Uh, um, uh, I’ll jump in here, David. Um, so, you know, and kind of to highlight some of the challenges that, that Paul identified in the existing, uh, protocols. It feels like many of them were really developed with other industries in mind, whether it’s oil and gas, or energy or, or, uh, even forestry.

And adapting those to fit the needs of a grower, uh, has been a little bit challenging. So we’re hopeful that those protocols will evolve over time to really accommodate the needs of agriculture. Um, but we, we also felt like it was, it was important to engage, uh, uh, immediately in each of these available protocols so that we could get some hands-on experience and help growers navigate them as they are today.

But our goal is, is really to facilitate that connection between the half million grower customers that we have across our retail network. And, um, and whatever marketplace emerges as, as, uh, as the, the most valuable for those growers. Uh, but kind of across the board are, are, we have real concerns about cost and scalability of many of the existing protocols.

And again, that’s kind of why our focus is on trying to find the protocol that puts the most, uh, value

Chris Harbourt: in the grower’s

Paul Gambill: pocket. And, and, you

David Yocom: know, Chris, I, I might, I might turn the question to you because cuz Indigo has built a pretty robust digital front end to service. Some of these needs and the data entry and analysis that’s needed in order to do this in a way that’s scalable and meaningful for, for growers, you know, it, you know, two years, two years into this, what has been sort of the easiest aspect of that process to digitize and, and take pain away from farmers and, and what are some areas which that, that could get easier over time?


Paul Gambill: it’s a great

Chris Harbourt: question. I mean, I, I think first of all, like we, we should step back and think about like the choices that Indigo’s made and particularly the strength of the, um, the registry approved processes from Car and Vera. I mean, first of all, those are probably the, the most straightforward. And we look at, at those registries, both Car and Vera, they’re clearly the leaders, you know, in terms of the carbon space.

They are number one and number two, they’re the rock stars in this world. And when we look and think about agricultural carbon credits and we think about who our real competition is in a space, it’s, it’s forestry and other versions, you know, um, direct capture methods, those are really the competition, not necessarily in and amongst this group of agricultural carbon credits.

Those registries really give us a, an opportunity to answer the customer need. And that’s, I’m, I’m locked in always on the customer and thinking about in, in this case, it’s the buyers of the carbon credits and what are they looking for? They’re looking for something beyond approach. I’m buying an asset in a carbon credit.

You’re verifying that. You’re making sure that’s above board. You’re quality assuring this thing that we don’t deliver. We leave the carbon in the ground. Um, so, so, you know, thinking about the right way to do that with a registry approval, I decided early on, you know, that that was a. Essential that we have to play in the sandbox of someone else.

It would be great to create our own sandbox. I’d love to make my own rules. The buyers aren’t necessarily interested in that. The buyers are interested in something that’s, that’s of really high quality. So, you know, as, as I think about that process and it being onerous, absolutely it is. You know, the burden of a hundred year permanence is really, really hard.

But that’s what the buyers are looking for. The, the requirement for additionality is stringent and difficult, but that’s again, what the buyers are looking for for this, this thing that they’re not taking delivery of that we need to assure, um, absolutely that it, that it’s occurred. So, you know, when, when I think about that overall, the cost of that dissipate when the programs get really large.

And we also start to then solve the global climate problem when the programs get really large. So the, the, the concept for me has always been about scale and how to think about the cost not being onerous for the individual grower. Um, but the cost then, Really it’s the job of indigo to scale the programs, to find the buyers, to make the connections at scale in a way that drives this, um, to being something profitable.

And, and that only really comes, comes at at very large scale. So we’re, we’re doing everything we can in terms of software and reducing the grower data entry burden and working with agronomy partnerships and trying to figure out the right way, not only to implement the technology of the process of connecting this transaction, but to, to really reduce the lift overall.

And the, the challenge of what is the pivotal issue here is getting growers to change the way they farm, you know, and implement the cover crop or reduced tillage technology of either going to Mintel or no-till. And thinking about doing split applications of nitrogen instead of fall and hydros application, for example.

You know, working with them to make those fundamental changes in their business. Is, uh, is the greatest technical challenge, you know, so I that for, for me, it’s a, it’s a, it’s a mix of then figuring out the right ecosystem partners like nutrient, who’s already out there doing this stuff with farmers and, and have that belly to belly relationship and trying to figure out how to give them the tools to strengthen that, um, around this opportunity for carbon.

So, and, and for me, the registries really drive that ultimately from the, the, the motive force of we’re taking money from industries who aren’t normally in agriculture, and we’re putting that into, um, rural communities. So we’re bringing new dollars into the agricultural system and we’ve got a high bar to pass to, to make sure that, um, that’s done appropriately.


Paul Gambill: absolutely. And, and

David Yocom: one, one quick question before I, I’m gonna a, after this. A quick question for Russ, but just in terms of the actual, you know, adoption of new methods and new technologies on the farm, are there certain things that farmers. Over the last year or two have found to be much simpler to adopt versus others.

Are there certain practices that are just easier and more desirable to implement versus others that just simply aren’t getting any traction?

Paul Gambill: Yeah, David,

Chris Harbourt: I mean, from, from our perspective, the ones that are, are easier require, um, no new equipment and not really a behavior change. So if you can come in and do a creative application of nitrogen where you’re doing a split application or a delayed application changing your behavior there, that’s pretty straightforward.

A nitrogen, uh, um, an inhibitor, um, uh, is also, you know, something like an n serf product from, um, from Corteva would be an example. Um, the, the more challenging ones are, are cover crops. It’s the one that really is the key here. I mean, we’re ta the, the technology we’re talking about is photosynthesis and increasing photosynthesis.

That’s what grabs the carbon dioxide and starts this whole, you know, your little science 1 0 1 at beginning. I mean, that’s the key mode of force. So getting them there, it’s challenging. It’s difficult. How to plant it, how to terminate it, how to deal with it, uh, with their existing planter technology without going whole hog into like a no-till environment.

Um, that’s a big decision. So those of course, are delayed, although the greatest gains come from those in terms of carbon credit return. So the, the growers kind of torn what, h how do I jump in? How many fields? How do I commit to make sure I don’t get upside down in my standard business? Those are all, uh, really important things to, to think about.

But, but we, we tend to see the things that, that don’t require a change in equipment today as the ones that, uh, are, are most easily, um, implemented in the first year of the program.

David Yocom: Got it. Thanks Chris. That’s the actually really interesting insight. Um, so you know, Russ, with all the, the talk here about, um, credits for, for Carbon.

I know that some of the growers and ranchers in your network through Blue Nest. Um, are in a position where they’ve been able to get paid for other forms of conservation, like, uh, like bird, like, like creating spaces for birds, uh, and, and, and bird oriented conservation. Um, and, and that fundamentally evaluating and potentially implementing that is simpler than other forms of, uh, offsets, like potentially carbon.

Can you speak a little bit to that and just the decision making that growers and ranchers in your network might be making in terms of choosing that type of offset as opposed to picking carbon credits that are being stored in the soil and that have a much longer term horizon? Yeah.

Russ Conser: Well, I, I do think that the soil carbon thing is really important.

It does have a longer term horizon, and I personally keep my feet pretty deep into science and technology of doing that well. But it was precisely because of the appreciation of how hard that is to do well. That, that our answer was, you know, what can we do today easily to make it really simple? And ended up partnering with the National Audubon Society here to be the, the market, uh, making partner to, to bring, uh, beef produced under protocols that restore, uh, bird habitat to consumers who care about that, uh, as a place to start.

The bird is, uh, you know, unlike soil carbon where no one know what a ton of carbon is, but it’s hidden below the ground, you can’t see a bird. Habitat is something that’s very visible for folks and it’s also very easily appreciated by people. Uh, we simplify that for the producers, um, by saying if you produce according to those protocols and you can meet our quality standards, because.

Uh, it’s just kinda like electric vehicles. People aren’t gonna buy a car out of guilt, uh, because it’s an electric vehicle. They’re gonna buy an electric car, a Tesla, because it’s really fun to drive, right? So we know we have to deliver a really awesome product, but when we can do those things, we can pay the farm, the farmer, a substantial premium for their, uh, the cattle that they’re producing and, you know, come out ahead without having to go through all these things that we’re still wrestling with.

I mean, I really enjoyed this last conversation, um, here with Paul and Chris and Dave. We’re, we’re wrestling with all the right questions on how to make things that are credible to the buyers and viable for the farmers. It’s just, in our view, we kind of opted for a, a different approach for this for the moment, which is, let’s keep working on that.

Let’s push all that stuff forward. But, you know, can we wrap a value proposition up here? Will we just pay more for better beef to farmers who are farming differently and sell it to consumers who care about those attributes as a way to get started? And that’s why we focused here on this direct to consumer, um, you know, magic box of beef that shows up on your doorstep thing.

It sounds really pedantic and simple, uh, but it’s intended to be a tip of the spear. The bigger, uh, the bigger movement here to sequester carbon and soil.

David Yocom: Uh, um, and I, I would take that point and, and just, um, ask, you know, Paul, Chris and Dave, if you, if you have thought on the incorporation of the value of other ecosystem services into the marketplaces that you’re building, um, I, I imagine that it is un in the future it would be something you would be wanting to incorporate.

But just curious to know if there’s any plans currently to sort of figure out how to incorporate those and get farmers paid for other types of, um, ecosystem services that they might be providing.

David Stanko: Yeah, David, that’s definitely on our roadmap and I think carbon is part of it, but especially if you, if you look at the types of practices that can increase, uh, uh, carbon sequestration in the soil, a lot of those also have benefits both on water quality and, and potentially on water quantity, um, in those areas that are irrigated.

So, um, we, we’ve been a founding member of the Ecosystem Services Marketplace Consortium, which is doing just that, trying to stack carbon and water credits together. Um, and we believe there’s a real opportunity there, uh, primarily tied to, again, those same practices can generate, uh, both improvements on water performance and on carbon performance

David Yocom: at the same time.

We don’t

Paul Gambill: have any plans to monetize other ecosystem services in our market because I, what’s, what, what I think is a little bit different about Nori, um, compared to these others is that

David Yocom: we’re not an agriculture company. Um, but we are, our first methodology is in agriculture

Paul Gambill: with soil carbon. Um, but we’re a carbon removal company.

So our, our expansion in the future will include other methodologies around things like agro forestry, kelp, uh, even industrial approaches like direct air capture.

David Yocom: Um, what we do,

Paul Gambill: uh, want to do is to make it as easy as possible for the verified data. Uh, the, the, the sort of resulting deliverable from going through Norris Croplands methodology, making it possible for, uh, farmers to take that verified data and make that usable within other markets where they could monetize other ecosystem services and to have records that are useful for

David Yocom: that verification.

Got it. Ms. Paul? Um, You know, Paul, I think it’s a, a good time to talk a little bit about it. Um, and I, and I would encourage anybody to go read, uh, some of the really excellent content that Norris put together, um, on their medium page or on Paul’s medium page, um, where they really give a, a strong, uh, case for the work that they’re doing and, um, and building this around sort of a blockchain network.

And so, Paul, I’m wondering if you can, you know, at, at the, at the simplest level and the most explainable level, talk a little bit about how Nori uses blockchain to verify transactions and carbon credits issued through its marketplace. And if you could tie into that just what the problem is with multiple counting of carbon credits.

Um, so I find that to be a really interesting problem. Um, and obviously it’s super relevant to actually supporting the fight against climate change. Can you, can you talk a little bit about those aspects of Nora’s core technology?

Paul Gambill: Yeah. So, um, The way that carbon markets work evolves from originally the Kyoto Protocol in 1997.

Um, so un creating the clean development mechanism and standards for frameworks that carbon credits could be built upon. And these markets were designed by scientists and bureaucrats, and they were not necessarily coming from a place of solving an actual market need. They were trying to create a space

David Yocom: for this to happen in the future.

And, uh, we believe that

Paul Gambill: one of the, like extremely fundamental flaws in the way these markets were designed is that

David Yocom: they were set up so that

Paul Gambill: the carbon credits that are issued, uh, to the project developers become the actual tradable commodity asset. Now, the intention behind it is good. We want to have a, uh, commodities market for carbon.

For all the reasons that we want to have commodities markets for any other, uh, uh, product or, or, or thing like that. It’s for, for better price discovery and forecasting and, um, just the way that like our economy runs. But the problem is when you is, so typically what happens is someone does a project, they’re issued carbon credits.

They sell those to most often a broker who then resells them onto someone else who might sell them onto someone else, someone else, someone else. And it’s, it’s less than, I think 25% of all carbon credits that have, uh, been created that ever even get retired. And retirement is carbon market language, meaning that the end buyer is saying, we are no longer going to resell this.

This is taken out of circulation. So when you look at the lifecycle of a carbon credit that way, that means that it, it’s trading hands over and over and over again. And e each buyer is paying the previous broker, which means everyone’s taking their cut from it. And when you look at the total amount of money paid for the carbon credit over its lifecycle, very little of that actually ends up in the hands of the original project developer.

So we think those are some serious problems that, uh, that we think of as a, a sort of double counting issue where, uh, we want to live in a world where every new dollar that is spent on a ton of CO2 actually results in a net new ton of CO2 coming out of the air. So that’s one of the double counting problems.

The other one is more fundamental to international carbon accounting where. Um, so going back to Kyoto, the original concept was the developed countries would be paying, developing countries for carbon projects that are happening within their borders. This was seen as an equitable, uh, transfer of wealth in the fact that the developed countries are developed because of our carbon emissions.

In Paris in 2015, there was a recognition that, okay, it’s the problem’s gotten too, uh, too out of control, that we actually have to have everyone, uh, setting their own targets for what their emissions reductions are going to be. So everyone has obligations to this now. The problem is the, uh, the way that it, uh, worked before, and the way that it still works today because they have not yet solved this problem, is that if a, uh, carbon credit is developed in a country like, say Brazil, and sold to a buyer in a, um, country like say France, then both Brazil and France currently count that as an emissions reduction towards their Paris climate goals.

So literally every single carbon credit that has ever been sold across international borders has been counted twice. So that’s the, the more obvious double counting problem. So our solution to this at Nori, and this is again, why we’re not working with the, uh,

David Yocom: original carbon registries because they fundamentally

Paul Gambill: can’t, uh, reorganize themselves to work in this way, is when a, uh, an N R t, the carbon credit inside Nori is sold.

It’s immediately retired. The buyer is not allowed to resell that carbon credit. So every new dollar spent within Nori is a new ton of CO2 coming out of the air. And because we’re doing that immediate retirement, it’s possible for us to much more easily report up for international carbon accounting purposes.

It’s double entry bookkeeping. It’s a like 400 year old technology and it’s not

David Yocom: being used in carbon markets today. And so we’re using blockchain to enforce that, uh, for the way everyone interacts. Got it. Um,

Paul Gambill: and typically, I mean,

David Stanko: I mean

David Yocom: when without a, without a blockchain protocol in this case, the buffer pool typically would, would try and would try and mitigate the aspect, mitigate the damage of not retiring credits.

Cool. So that’s,

Paul Gambill: that’s a slightly different issue, which is more related to permanence and Got it. Insurance and leakage. And, um, and, and the typical approach is you, you

David Yocom: take, like, say 20% of the carbon

Paul Gambill: credits that are, that are created or projected over that period of time, you set them aside in a buffer account and then use those to, um, deal with any leakage or, or, or gaps or

David Yocom: something like that.

Our approach is different in that, um,

Paul Gambill: we don’t want to take 20% of revenues away from farmers. So instead we’ve adopted a system where,

David Yocom: um, we separated out the method

Paul Gambill: of payment for the carbon certificate itself. So we’ve got the N R T, which is the carbon certificate, and then we’ve got the

David Yocom: Nori token, which is the method of payment

Paul Gambill: for it.

And that nori token, one token’s always worth one ton. That becomes the tradable commodity asset. And we’re using that for

David Yocom: insurance purposes.

Paul Gambill: So, uh, when a farmer gets paid, Uh, for selling their NRTs, they’ll re, they’ll receive tokens and some of those tokens will remain restricted over the course of that 10 year contract.

And if, uh, if we find that we over issued or they break their contract, they till and release the carbon, we claw back those restricted tokens and use those to go buy new NRTs on behalf of the original buyer. So that’s our, uh, that’s our method of dealing with insurance. But when the farmers have these restricted tokens, they’re still on their balance sheet so they could collateralize them if they need to.

David Yocom: Got it. Thanks Paul. Really helpful explanation. Um, Dave and Chris, do, do you guys have an opinion or a thought on, on, uh, creating this kind of reduction of double counting, ensuring that, um, that, that carbon is being, that, that ensuring verification of, uh, of carbon sequestration and, and reducing double counting in these marketplaces?

David Stanko: Yeah, it, it’s definitely a concern. Uh, but then there are those of us, you know, in Scope one and two emissions. Um, you know, we’re not double counting with others in the supply chain, but Scope three emissions actually becomes a problem there because we are double counting it from, uh, from an inventory standpoint.

And so to the extent that there’s multiple times being counted, um, uh, we we’re trying to explore options that allow us to also, uh, intervene and, and both, uh, get credit for that intervention in, in terms of re reduction. So, uh, it’s a challenge. It feels like the accounting, uh, standards maybe haven’t quite caught up there.

But, um, while we want to ensure that those are good quality credits, we also have to, um, uh, account for the, the fact that there’s already double counting happening in Scope three.

David Yocom: Great. Well, um, seeing where we are, uh, from a time perspective. What I’d like to do at this point is jump to, um, the sort of key takeaways and then an opportunity for some questions from the audience, uh, of some of the speakers.

I know we have a lot of questions in the q and a box. We may not have time for all of them today, um, but we’ll get to as many as, uh, as is possible. So in terms of some key takeaways, you know, from speaking with each of the speakers prior to the call and a lot of the background research that we did as a team, my sort of three key take takeaways were really that the, the time is now the, the pressure for climate action worldwide is urgent.

Um, systems for. You know, managing, measuring carbon aren’t perfect, but in this case, we shouldn’t let the perfect be the enemy of the good, and that there is a significant opportunity to act on this now. And that the, the companies that are building the platforms that are going to sell, manage, measure, uh, soil, carbon and other, uh, services going forward, are coming online today.

Um, which is a really exciting time. Um, uh, for, for climate mitigation. There’s clearly room for improve and change and that soil is a promising, uh, not fully proven, but, uh, but promising, uh, tool in, in the fight against climate change and the means by which that farmers can get paid, uh, for, uh, providing some of these services, uh, in addition to supporting the potential for other markets to develop going forward in the future.

So I think those are opportunities where clearly it needs to get better and, and there needs to be refinement and trust on both sides, and then building out both the buyer and the seller side. But, um, but really promising nonetheless. And then there is a potential win-win here really in that if we can promote more soil carbon into the soil, we can have healthier soils that have a, a number of, uh, promising environmental benefits going forward.

In terms of areas for opportunity, you know, I think the measurement piece is obviously really clear. We talked a lot about that. Um, better mouse traps would be great, um, and ones that are scalable, low cost and a high accuracy would be welcome. Um, and then additionally new tools, uh, those like that are being developed at Silicon Carbon Company, um, to, uh, sequester more carbon, more efficiently at a low cost while ideally bringing on uh, agronomic benefits, um, would be excellent.

And I think my sort of two main remaining questions that I don’t know, The truth too, but you know, I have some thoughts on are how many marketplaces and methodologies will there be, will there be a likely consolidation between, um, those respective areas? And will there sort of be a standard marketplace and a standard protocol that will sort of end up dominating or will there be multiple that will exist for different use case or different, different, um, geographies.

Uh, and then finally, you know, if there is inevitable break in trust on some side of one of these marketplaces going forward on the supplier, the demand side, you know, what’s the impact going to be and what sort of are the strategies to recover from, you know, inevitably someone asking, is my carbon really being sequestered or am I really gonna get paid for this?

I think those are some, um, important aspects. So with that, we have a few minutes left here. Um, I am going to go ahead and open up the q and a box, uh, that we’ve got here and see if there’s any questions that we can answer from the audience and speakers. Please feel free to jump in if you, uh, if you feel like you have the answer, just gimme a second here to read through, read through a few of these and, and if you have new questions, please feel free to, uh, to chime in.

So here’s one question from the audience. I’m interested in measuring and documenting production resiliency that results from adopting practices that build soil health. How are you measuring yield stability in good years and in stress environments with soil organic carbon increases in communicating this to growers and to their advisors?

So I think that would sort of be a question towards, uh, either, um, Chris, Paul or Dave. I dunno if you guys have an opinion there. It’s a,

David Stanko: it’s a great question and I, I think one that doesn’t have an easy answer, but I, I, I will say, I think we’re all looking at the, um, kind of in carbon intensity, uh, per bushel.

So, uh, in those difficult years where maybe you have, uh, a yield decrease because of external events like weather, um, uh, we, we still believe there’s an opportunity to, IM improve the carbon footprint, uh, per unit of output, uh, on grower’s field. So trying to kind of hold that constant, uh, in a way. But, um, it’s difficult.

There are going to be years where, because of weather events, either more fertilizer is used or less fertilizer is used, or, or yield has an Im, uh, takes a, has a, a negative impact and, um, uh, in many ways it’s out of our control.

David Yocom: This next question actually is, is really interesting in the context of farmers who are already.

Paul Gambill: Taking into account,

David Yocom: um, opportunities to improve soil carbon management and sort of how they can get paid if they’re already in a position that they are implementing these practices. So this question says, in my area of Kansas, farmers already use no-till grass waterways, uh, cover crops, woody wind breaks, buffer strips, rotational grazing, graze cover crops and crop residue, and a whole host of other conservation practices.

How do you account for all this good work and ensure that those farmers can monetize their progressiveness, particularly if they’ve already made, uh, those behavioral changes?

Paul Gambill: I’ll, I’ll take a first

Chris Harbourt: stab at this. I mean, and, and others. I’m, I’m sure we, we can all think about what this means, but if, if growers are already doing amazing work, there’s always something they can do.

In addition to that, there’s always a different mix of cover crops that may be right or, um, uh, a change somewhere that counts as additionality where you can, uh, participate in a carbon program. But I think one of the, you know, we talked a little bit, David, about the. Connection between the other stories and the other sustainability concepts in the industry, there’s, there’s a story that can be told by the product that’s coming off your ground.

So if, if that wheat has a buyer who’s interested in, um, making a claim around a consumer package, good, there’s an opportunity there for a connection and a, an increased value per bushel of that crop as a result. So, you know, there’s, there’s programs, um, around and projects field to market comes to mind, and some other groups that are adjacent to the concept of a soil carbon credit, um, that are on the same order.

When we think about, you know, something like, 10, 15, $20 an acre of a carbon credit. I mean, just do the math in your head to get that back to cost for bushels. You’re in that seven to 10 cents a bushel range for that. So that’s right in there with a premium for a special, uh, qualification of a, of a grain product too.

So you can think about it that way where there’s, there’s opportunities beyond just the carbon credit. If they’re already doing amazing work, we don’t, we want to continue, we don’t wanna discourage that. You know, some farmers have come in with a hyperbole of well, is gonna come in and moldboard plow it and I’ll start over.

Oh, we’ve got a five year baseline look back too. So that’s not necessarily the best choice. You’re already doing amazing things. Hopefully you’re doing those because they make your operation better and there’s always something additional and, and hopefully, like, one of the reasons I’m here is just hopeful there’s new technology out there that we can bring into that additionality world that can help those farmers who today are doing everything.

But if there’s new technology coming on board, let’s make sure they capture the carbon credit potential from that new tech as it emerges.

David Yocom: Thanks, Chris. Other thoughts or comments on, on that question? Yeah,

Ray Riley: and kind of, I think it goes along with what Chris was saying. You know, if you think about the off-takers of the production from agriculture, that’s one of the things that Soil Carbon Co is working on is off-takers, both in the food area and the industrial areas, uh, value the ability to be able to be delivering on their, their promises in terms of improving, uh, their impact.

And so working with the, you know, it comes back to blockchain approaches and, and systems in place that they, uh, not only focus on the carbon credits, but also on the value and reputation that can be brought by recognizing the, the good practices.

David Yocom: Thanks, Ray.

Russ Conser: I I would just throw in another 2 cents that, um, and, and it kind of exists at the intersection between Paul’s comments and the comments, um, from Chris and David.

On, uh, the importance of market standard protocols. I, I, I think the concept of additionality was designed by a bunch of folks that, that have the right goal in mind, but we kind of have industrial mindsets on how we define those things. And I think over time we’re gonna have to get more creative, um, and forward looking in terms of how we design into these protocols.

What constitutes additionality, what we really care about is that there’s another molecule of carbon coming out of the air tomorrow that’s in the soil and not in the air. And I think our market protocols try to do that, but they create some artificial barriers for some of that. So look for some evolution of these market protocols, I think in the next 10 years that they’ll co-evolve with the technology and the experience.

Chris Harbourt: I

David Stanko: completely agree, Russ. I, I think, I think hopefully we can get to a point where every time matters and, and, uh, not have, uh, some of these additionality thresholds that make it difficult for a grower to engage.

Russ Conser: Hashtag that Dave.

David Yocom: Great. Um, well, it’s seeing that we’re running about five minutes over. Um, I know we could probably go on with a number of questions here for, uh, quite some time, but I want to just pause here. Uh, Ray, Chris, Paul, Dave, Russ, any last thoughts or comments you would like to leave the audience with?

Chris Harbourt: I’ll, I’ll just say it’s a, it’s a bit of a gold rush right now, but there’s opportunities for a number of startups and new technology all across carbon, so I’m really looking forward to the innovation that comes from it. It’s a space worth investing in, and it’s great to have the government tailwinds behind us now with the latest administration as well.

Paul Gambill: Agreed.

Russ Conser: Yeah. And market interest. And I would, I want to emphasize, I think with a final comment here, Dave, what you said of, uh, the time is now I put a little link in the chat window. My, uh, former colleagues in the Shell scenario team just issued their new Senate scenarios yesterday. And one of them leans very heavily on nature-based solutions, including soil carbon.

And it really makes it clear that the only way this planet gets to one and a half degrees sea warming is a limit, uh, is if we get really, really serious about nature-based solutions. And if you look into nature-based solutions, although historically most of the focus has been on trees because we can see them and they’re easier to count, um, I think the big opportunity window is in soil carbon.

So how we do that confidently, accurately, um, is really complicated. I think it’s gonna get a lot of attention, but it needs it. And we kind of like everyone here today has said we have to absolutely start now. And go as fast as we can. And we’re probably gonna trip and fumble some things along the way, but, um, we just, this couldn’t be more important in my view.

Ray Riley: Awesome. Yeah. Maybe just a couple of thoughts. You know, as you look through the points discussed today, there’s a lot of areas of this that are evolving. You know, there’s the measurement, there’s the market, there’s the, the agronomic practices, and there’s the things that we’re focusing more on in terms of the microbial community.

An awful lot of these are evolving to create new opportunities and, and they rely on each other. They’re very synergistic. And that’s creating a tremendous opportunity in this space to, to work together and have an impact. So it’s, it’s fun. It’s a fun and, and opportune time.

David Yocom: Thanks, Brad. Great Wolf. If there’s no further comments, uh, I sincerely want to thank Paul, Chris, Dave, Russ, and Ray, uh, for participating today.

Um, a lot of really interesting insights are all doing different work. You’re all doing really important work and we really appreciate you sharing it with us. Um, for anybody in the audience, thank you for your active participation and for being a part of this discussion today. Um, for everybody who is new to this call, uh, we host these deep dives once per month, typically on the second Wednesday of the month, uh, at 9:00 AM central time alternating a topic in food and agriculture, uh, like this month, uh, into a healthcare topic, uh, which will be next month.

Um, if you have any questions or comments for me, you would like access to the deck materials or research that was used to put together this presentation. Um, please feel free to email me at d yocum d y o c om isec Um, and finally, we actually have another opportunity to come here, uh, shortly. Um, please take a moment, uh, to mark your calendars, uh, for the next upcoming cus conversations.

Um, uh, which is a call to action, transformative investment in climate smart agriculture. Obviously very relevant to today’s conversation, uh, featuring, uh, uh, Aaron Fitzgerald, CEO e o of US farmers and ranchers in action. And Rob Trans founding partner of Better Food Ventures. Um, but otherwise, thank you everyone for your time this morning.

Um, thanks for being part of such an important and interesting discussion, and we look forward to seeing you next time.



Analyst: iSelect Venture Team

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