Right now, there are two established approaches to quantify soil carbon: sampling (testing soil samples) and process-based modeling (which simulates carbon dynamics over time under different farm management or climate scenarios).
Boulder-based Perennial is pioneering a third approach—digital soil mapping—which it claims will expand access to carbon markets, regenerative project financing, and sustainability programs in remote or data-scarce regions that have historically been excluded from participation.
The startup, which has just secured approval to use its VT0014 digital soil mapping tool in Verra’s Verified Carbon Standard (VCS) program, uses satellite and other environmental data, machine learning, and historical on-the-ground data to build statistical models.
This, it claims, drastically reduces sampling needs, making for a “more cost-effective, streamlined, and scalable” approach.
“This tool is a quantum leap forward in soil quantification,” says Perennial cofounder David Schurman. “Not only does it lower barriers for MMRV [measurement, monitoring, reporting, verification] in areas where projects are already underway, it unlocks new regions, new carbon projects and new opportunities for climate finance.
“We’re already starting to see this unfold with partners such as rTek, a project developer regenerating 500,000 hectares of degraded grasslands in Kazakhstan who can now access carbon markets under Verra’s VM0032 methodology.”
Other players in the carbon markets have also committed to working with Perennial as an MMRV partner, including Bayer, Anthesis, and CoolPath, says the firm.
“After extensive validation studies, we chose Perennial as one of our global MMRV partners due to their exceptional ability to deliver precise results with minimal sampling.” Leo Bastos, SVP, head of global commercial ecosystems, Bayer
“Digital soil mapping is critical to reducing the costs associated with the implementation and scaling up of agricultural land management projects. This will meaningfully strengthen access to soil carbon markets for farmers and ranchers worldwide, while ensuring the highest standards of integrity and transparency for project developers and corporate buyers alike.” Mandy Rambharos, CEO, Verra
‘Rigorous testing’ with Bayer
Cofounder David Schurman tells AgFunderNews: “Digital soil mapping has been around in academic literature for about 20 years. Essentially, it’s a way of using a bunch of data about natural ecosystems that you pull from satellites combined with on-the-ground data such as soil samples and relating those two together with an algorithm and machine learning to scale up our ability to map carbon.
“Five years from now, everyone is going to be using some form of digital soil mapping. Imagine a time lapse photo of every farm everywhere. We use these snapshots over time to build a picture of what is happening in the ecosystem, and then we feed that into our models.
“We’re looking at all the things that affect carbon from how hot is it, to precipitation, tilling, and how much biomass [crop residues, etc] is being put into the soil. Sometimes we bring in other data sources too, but you can really see a lot with satellite data.”
Process-based modeling is ideal “where you have a very well-studied ecosystem with a lot of data going back in time, for example in North American row crops,” he explained. “But there are two problems. One is the amount of data that you need to run these simulations. You have to know everything that has ever happened to this field and everything that the farmer is doing in order to get a good estimate, which is very labor intensive and often not available.
“Two, this doesn’t translate very well to grazing or grasslands or regions [with less available data] like South America or Africa. There’s just not enough history of research to make the simulations. So this is where digital soil mapping can come in and really fill the gaps.”
He adds: “There are other players [in digital soil mapping] but we are the farthest along in terms of readiness and commercialization. We worked with Verra [the most widely used voluntary carbon market standard greenhouse gas crediting program] because we knew the market was only going to accept something with rigorous third-party certification.
“The work with Bayer has also been instrumental. We’ve done a bunch of rigorous testing with them on farms that they had already sampled [enabling Bayer to validate Perennial’s technology].”
Carbon sequestration potential
Another appealing aspect of Perennial’s tech is its ability to measure soil health and carbon sequestration potential, which can help partners decide where, and whether, to run regenerative ag projects, says Schurman.
“People are only going to do this if the economics work out for those implementing the programs and the farmers. So the difference between point one tons per acre per year in potential and point four is huge.
“Being able to identify this has been really important both for what farms do we enroll, and for what regions we approach,” adds Schurman, who said Perennial has raised over $25 million from backers including GenZero, Bloomberg LP, Microsoft’s Climate Innovation Fund, SineWave Ventures and Augment Ventures.
‘When you lose carbon, you lose what separates soil from dirt’
Stepping back, he says, “Generally, when things get hotter and drier, that is bad for soil carbon, so we are seeing more and more carbon that is passively getting released from the soil. And when you lose carbon, you lose what essentially separates soil from dirt.”
But regenerative ag projects designed to improve soil health, organic matter, and water retention don’t deliver benefits overnight, and farmers need financial incentives to make the transition at a time when soil carbon credits can be greeted with skepticism amid concerns over additionality and durability, he says.
“When we talk to buyers, there are always two concerns about soil. One is, can we measure it properly? And two, is it durable [as tillage, drought, or land use change can release stored carbon back into the atmosphere]?”
As for accurate measurement, “We’ve been working for seven years to answer that [affirmatively],” he said. And when it comes to durability, “That is an issue with any nature-based approach. But no solution is perfect. We’re going against entropy here to try and put carbon back in the soil.”
He adds: “You have this choice between things that are highly durable, but really small [like direct air capture] and are going to stay small no matter what Silicon Valley tells you, or things that are really big and really fast [nature-based solutions such as regen ag projects] but have a durability concern.
“You kind of need both if you’re going to get anywhere near where you need to be on your net zero commitment.”
Pricing environmental assets
Should regulators require carbon accounting, “People are going to look immediately to soil and forest [carbon sequestration projects], and then they’ll figure out the durability issues,” he predicts. “And there are ways of doing that is through appropriate pricing and insurance [of environmental assets]
“We can borrow a lot from the financial sector here, which pools risk, which is something the VCM [voluntary carbon market] already does. If 10% of the farmers in a project drop out, for example, that is already accounted for using a mechanism called a buffer pool. Of the credits that are issued, some of them get held off to the side and put in a pool [and not sold]. And so then you dip into that.
“It’s not going to be perfect. But that’s how our whole financial sector works.”
Price differentiation of commodities based on carbon intensity
As to other incentives [aside from carbon credits] for corporates to pay farmers for implementing regen ag projects, he says, “I think Scope 3 emissions [which larger companies in some markets such as the EU are required to track and monitor] is going to be a big one.
“What I would like to see eventually is price differentiation of commodities based on their carbon intensity [something that is already happening in the biofuel market under schemes such as the 45Z Clean Fuel Production Credit initiative, which provides tax credits based on CI reduction relative to baseline.]
“This turns [regen ag] into a win-win instead of something that has to be propped up by carbon financing alone.”
He adds: “There are also other interesting questions around how do we value land, if land is degrading? Can we tie this [regen ag scheme] to the asset value? We have to move from this being something that you only do if you care about the planet to something that makes sense economically.”
According to Schurman, “Europe and Asia are leading [efforts to track and reduce Scope 3 emissions] and you have some consumers who are demanding traceability.” In the US, he says, while many firms have made commitments to track and reduce Scope 3 emissions, climate has become caught up in the culture wars: “It’s a radioactive term.”
Looking at what is holding farmers back from adopting regenerative practices, “the number one is the money,” he says. “And then it’s tradition. If you do something the same way for generations, you have an attachment to it. It also depends on the age of the farmer. But once we get the money in place we can get over that upfront hurdle. And once people start seeing that it works, that is when it starts cascading.”
Further reading:
Building the GHG accounting toolbox: Arva scales payouts for regenerative ag
Carbon insurance evolving from ‘nice to have’ to ‘must have’ in today’s carbon markets, says Artio
