How Can Farmers Sell Carbon Credits in Alberta?
Updated: Jun 15, 2022
You need two things to produce solar power: space and sun. With Alberta boasting the second-greatest solar potential of all the Canadian provinces, farmers – with space to spare – are wondering how to capitalize on this booming industry.
The answer is carbon credits.
If you're a farmer asking, "how can farmers sell carbon credits from solar?" you've come to the right place. Below we'll explain how selling carbon credits for the solar energy you’re producing can create a significant additional income stream for Alberta farmers. And we'll explore everything you need to do to get started.
Let's start with the basics.
What is a carbon credit for farmers?
Carbon credits, as we often explain, represent one tonne of voluntary CO2 emissions reductions. You can create a carbon credit by preventing CO2 emissions or by sequestering (i.e., removing and storing) CO2 from the atmosphere. One of the best ways to create carbon credits is via solar panels or wind turbines for farmers - the clean energy generated displaces CO2 emissions from the electricity grid, which in Alberta comes mainly from fossil fuel combustion.
Sounds simple, right?
After you've created a carbon credit, it can be sold to another company or individual who gains the right to claim that emission reduction as their own.
But why would they want to do this?
In Alberta, companies purchase carbon credits because of provincial rules limiting the amount of CO2 that large industry can emit. If a business goes over this threshold, it faces financial consequences. To avoid such a scenario, businesses purchase carbon credits - paying someone else to reduce their GHG emissions - to ensure they can meet these regulations.
The end result is the same – less CO2 in the atmosphere.
How can farmers sell carbon credits from solar?
So why aren't farmers selling carbon credits from their solar installations en masse? Well, while big businesses - such as the large, utility-scale windfarms in the south of our province - have sold carbon credits for years, farmers have largely been frozen out of the market by the cost and expertise required to create carbon offsets from small solar systems.
Because carbon credits are provincially regulated, their creation must guarantee carbon reduction. To do this requires following specific government rules and extensive data collection and storage, as well as independent third-party audit. For farmers - and other owner of small solar or wind installations - the financial reward from carbon offset credits has never been enough to justify the the cost or bureaucratic hassle of registering these carbon credits.
The solution is a collaborative carbon credit company. Here, multiple small-scale solar energy producers pool their production together - a process known as “aggregation”. The aggregation company is responsible for carbon credit creation and selling according to the provincial government’s requirements.
All farmers need to do is concentrate on managing their solar power systems – it's that simple.
What are the benefits of carbon credits for farmers?
So what benefits can farmers expect from solar power and carbon credits?
The most obvious benefit of a solar energy system is its power generation. When connected to the grid, you can use the energy to power your home and your farming operation when the sun's shining and use the grid when it's not.
Depending on the design it could even eliminate your energy usage at specific times, allowing you to actually sell energy to the grid.
By joining a solar aggregation pool, you'll also earn money from selling carbon credits. A single acre of land can fit a 250-kW system – the estimated carbon credit return over ten years is CA$55,480 to CA$128,700 – alongside your income from the grid. It can be a sizable portion of your overall revenue.
Other ways for farmers to earn carbon credits
Solar power, as mentioned, isn't the sole way to create carbon credits for farmers. Other Alberta-approved protocols particularly relevant to agriculture include:
Fed cattle - reducing the greenhouse gas emissions from fed cattle and
Biogas - which can be produced through the anaerobic decomposition of agricultural materials, like at the Perry Farms near Coaldale.
These approaches reduce atmospheric CO2 and thus are relevant to carbon credit creation. Here at SOLAR OFFSET, we exclusively handle microgeneration solar and wind systems, though we are well connected to the carbon offset industry and can advise on who to speak to about these other protocols.
Carbon credits for farmers: A lucrative opportunity
SOLAR OFFSET makes it possible for farmers to sell carbon credits from their solar and wind power systems. Join us and be part of Alberta's energy revolution. For further information about how farmers can sell carbon credits, contact our team or sign-up to participate.