The next exciting phase of developing greenhouse gas (GHG) offsets from rice production in the United States is now possible thanks to a $1.1 million grant from the U.S. Department of Agriculture’s Natural Resource Conservation Service. EDF’s second Conservation Innovation Grant project for rice GHG offsets will expand the first grant’s scope from California, the second leading rice-producing state (550,000 planted acres in 2010), to include Arkansas, the leading rice-producing state (1.8 million planted acres in 2010), as a model for other mid-southern states and will develop innovative technology to enable easier access to carbon markets.
The new grant includes previous partners involved in the development of the rice methodology—California Rice Commission, Applied Geosolutions, LLC, and TerraGlobal Capital, LLC—as well as new partners—Winrock International, PRBO Conservation Science, USA Rice Federation and other leading rice industry associations and rice producers in each region.
A Foundation: The first grant resulted in a methodology that provides a foundation for work to continue in California and begin in Arkansas. California has been a successful testing ground for assessing offset potential because of its groundbreaking climate law co-authored by EDF, The Global Warming Solutions Act (AB 32), which establishes a cap-and-trade system in 2012. However, including other rice-producing states will greatly increase the opportunity for GHG reductions and offset credits from rice production. If the California Air Resource Board adopts a rice carbon protocol, California rice growers stand to benefit in the state’s cap and trade program by selling GHG offsets to capped sectors, and other rice growers outside of California also will be able to participate in the compliance market to help meet California’s demand.
Phase Two: The methodology is awaiting approval by two leading carbon registries — the Verified Carbon Standard and the American Carbon Registry (where it is now open for public comment)—and it will be adapted as needed for use in two pilot projects, one in California’s Sacramento Valley and the other led by Winrock International in the Delta Region of Eastern Arkansas. These initiatives will demonstrate the process of producing and selling offset credits generated by rice farmers to voluntary and potentially to compliance carbon markets, with particular focus on California’s cap-and-trade program. Each project will field-test a subset of GHG-reducing practices suitable to the region, such as straw removal or altered water management. The pilot projects will help determine which additional practices can be added to the methodology.
In addition to pilot project results, we will analyze rice GHG reduction practices in other states using the De-Nitrification De-Composition (DNDC) model. DNDC is a computer simulation model of carbon and nitrogen biogeochemistry in agro-ecosystems that can be used for predicting crop growth, soil temperature and moisture regimes, soil carbon dynamics, nitrogen leaching, and emissions of trace gases including nitrous oxide (N2O), nitric oxide (NO), dinitrogen (N2), ammonia (NH3), methane (CH4) and carbon dioxide (CO2). Used to analyze California rice’s GHG reduction potential, DNDC will be applied in other rice-producing states, including Louisiana, Mississippi, Missouri, and Texas. Practices such as mid-season drainage, which is currently not a feasible practice in California, may be more appropriate in other rice-growing states.
Concurrently, a user-friendly technology will be developed for growers and aggregators to enable more accurate and cost-efficient quantification of GHG reductions. Growers will test a tool that is accessible by personal computers and mobile devices, and they will also provide feedback on cost feasibility and process of the overall project. Lessons learned will be widely distributed to other interested growers and Natural Resources Conservation Service.
Since both rice-growing regions in California and Arkansas (known as a critical stretch of the Pacific Flyway and the rice and duck capital of the world, respectively) are key areas of habitat for waterfowl, shorebirds and other species of wildlife, the project will also strive to understand how rice management practices can minimize GHG emissions and maximize benefit to waterbirds. PRBO Conservation Science, a bird conservation non-profit, will lead the analysis of potential impacts of selected growing practices in California using habitat quality indicators and optimization models, which can be adapted to other regions.
Benefit to Farmers: Economic benefit estimates are based on California modeling of potential GHG reductions and cost studies. The three practices currently in the methodology and their potential for GHG reduction are: dry seeding (4%), removal of straw before flooding (8%), and reduced winter flooding (16%). The break-even costs for these practices range from $3 to $79 per ton of carbon dioxide equivalent. However, though the break-even cost for straw removal, for example, is around $79, this cost can be reduced through sale of the straw, and as carbon prices increase once the compliance market begins, there may be a business advantage for some farmers. Carbon markets could provide the additional value that enables a rice farmer to access these straw markets. Other practices yet to be analyzed may produce greater GHG savings, such as mid-season drainage in the mid-southern states, in which case economic return could be higher.
A final goal of the project is to seek out regulatory approval of a rice carbon protocol, so that the GHG emission reductions achieved will have compliance value under a cap-and-trade program.
The project is expected to start in August and will conclude in 2014.