Carbon baseline for California agriculture and the economic - - PowerPoint PPT Presentation

Carbon baseline for California agriculture and the economic approach to estimating the cost of carbon offsets

Sandra Brown, Ye Qi, and Jonathan Winsten Winrock International

sbrown@winrock.org jwinsten@winrock.org

Davis, California September 22-23, 2003

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Research Team

Sandra Brown – WI Aaron Dushku – WI John Kadyszewski – WI Timothy Pearson – WI Ye Qi – formerly of WI Jonathon Winsten – WI

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Measurement, Classification, and Quantification of Carbon Market Opportunities in the United States— California

Goals of this module:

• To quantify the baseline of changes in carbon

stocks in the agricultural sector of California for the decade 1987 to 1997 (non-CO2 greenhouse gases were not included)

• To identify and quantify opportunities for

enhancing sinks and reducing sources of carbon in the agriculture sector

• Similar work is being done in the forestry and

rangelands sector but not presented here

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General approach:

Two types of data were used:

• the total area of agricultural land by each major land-

use types—data from the National Resource Inventory (NRI) database for the period 1987-1997

• the carbon stocks in vegetation of each land use

derived from the literature and experience

• changes in soil carbon were not included as it was

assumed they have been under cultivation long enough that changes are minimal to non-existent under current practices

The analysis is conducted for the entire State of California and by county.

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High and Low Carbon Density Crops

Broad land use Specific land use Low carbon density crops Row and small grain crops Hay/Grass/Legume Summer Fallow Other, Set Aside etc. High carbon density crops Horticulture/Fruit Horticulture/Nut Horticulture/Vineyard Horticulture/Bush fruit Horticulture/Berry Horticulture/other

Divided crops into two main classes based on carbon densities

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Area of agricultural land in California – 1000 ha

Year Agricultural land High carbon density land Low carbon density land 1987 4,115 1,040 3,075 1992 4,063 1,008 3,055 1997 3,883 1,013 2,870

Overall loss of 232,000 ha or 5.3% of 1987 area 88% of total loss

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High C cropland proportion (%)

1997

14.61 - 19.59 11.2 - 14.6 8.32 - 11.19 6.11 - 8.31 5.22 - 6.1 3.44 - 5.21 2.7 - 3.43 1.76 - 2.69 1.62 - 1.75 1.12 - 1.61 0.6 - 1.11 0.49 - 0.59 0.28 - 0.48 0.07 - 0.27 0 - 0.06

Low C cropland proportion (%)

1997

38.76 - 56.76 28.38 - 38.75 14.93 - 28.37 10.22 - 14.92 8.19 - 10.21 4.45 - 8.18 3.83 - 4.44 2.79 - 3.82 2.17 - 2.78 1.43 - 2.16 0.85 - 1.42 0.31 - 0.84 0.16 - 0.3 0.07 - 0.15 0 - 0.06

Percent of county area in high and low density carbon cropland in 1997

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Change in area by land use

200 400 600 800 1000 1200

Hort/Fruit Hort/Nut Hort/Vineyard Hort/Berry/other Row/Corn Row/Cotton Row/otherVeg/truck Row/others Small Grains Hay

Area of land use (1000 ha) 1987 1992 1997

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Change in area of high carbon density croplands 1987-1997

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Change in area of low carbon density croplands 1987-1997

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Carbon density estimates of agricultural land used in the analysis

Fruit / Nut Orchards – 25 to 30 t C/ha Vineyards – 10 to 12 t C/ha Berries / Other Horticulture – 10 t C/ha Cultivated Crops and Hay – 5 t C/ha

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Carbon stocks by land use

Millions

• f tons
• f

Carbon

1987 1992 1997 Horticulture/Fruit 8.79 8.50 8.55 Horticulture/Nut 7.95 7.42 7.68 Horticulture/Vineyard 4.82 4.78 4.91 Horticulture/Berry/other 0.37 0.41 0.25 Row/Corn 0.81 0.44 0.55 Row/Cotton 2.67 2.69 2.71 Row/otherVeg/truck 1.78 1.41 1.25 Row/others 0.40 0.71 0.64 Small Grains 5.95 4.43 4.28 Hay 3.59 5.41 4.74 Total on agricultural land 37.13 36.20 35.57

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Change in carbon stocks through time

12 14 16 18 20 22 24 1987 1992 1997 High Carbon Low Carbon

Carbon stock (x 1000 t C) Year

• 3.74%

+1.33%

• 0.72%
• 6.10%

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Change in carbon stocks in high carbon density croplands 1987-1997

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Change in carbon stocks in low carbon density croplands 1987-1997

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Conclusions for carbon baseline for agriculture

Total area of agricultural land in the 1990s was about 4 million ha About 2/3 of agricultural lands are low- carbon-density crops (such as row crops and small grains), and 1/3 are high-carbon- density crops (such as vineyards and

• rchards).

Area of agricultural land decreased by 232,000 ha (or 5.6%) from 1987 to 1997, almost exclusively from the loss in area of low carbon density crops (88% of loss).

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Conclusions for carbon baseline for agriculture (cont:)

Total carbon stock in agricultural vegetation was about 36 million tons (21 million in high and 15 million in low carbon density crops) During the period 1987 to 1997, the carbon stock on agricultural land decreased by 1.6 million tons (or 5.9 million t CO2 equivalents)

• 66% of the loss was from low carbon density

croplands (1.03 million t C)

• 34% of the loss was from high carbon density

croplands (0.54 million t C)

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Opportunities for ameliorating carbon loss from CA agriculture

No-till and conservation tillage practices on cropland Aforestation and productivity improvements on rangeland

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Estimating the Supply of Carbon Offsets

Goal: To estimate the supply of carbon offset credits at various carbon credit prices. Methods: Use available data and economic theory to identify and quantify likely projects on individual land parcels. Prepare information in a GIS platform

• Identify areas for low cost offsets
• sum estimated carbon offset supply at various

prices

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Estimating the Supply of Carbon Offsets

Categories of Costs: Opportunity costs of producing carbon Conversion costs Measuring and monitoring costs Land management costs Contract costs

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Estimating the Supply of Carbon Offsets

Total estimated costs per hectare Calculate value of future cost stream (based on length of carbon project) Discount future cost stream to current dollars Allow for cost adjustment based on a risk aversion factor

• Farmers may prefer a guaranteed

income stream to uncertain agricultural returns

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Conservation Tillage (CT) on California Cropland

• Currently <1% of CA cropland is farmed using CT

(Mitchell et al. 2002)

• Potential of 1.73 million ha of cropland
• Increase soil C by 0.2 ton/ha/year
• 50% adoption rate
• 1.73 million tons C over 10 years
• Experiments show 5 MT C/ha over 12 years of

CT – 36% increase in soil C (Horwath and Doane, 2002)

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Conservation Tillage on California Cropland

• Possibly very low cost carbon
• CT is not costly to farmer (Rominger, 2002)
• Reduces number of field operations (Klonsky and

DeMoura, 2002)

• Reduces GHG emissions from machinery use
• Additional ecosystem benefits from CT
• Reduces nutrient and sediment runoff (Reickosky,

1998)

• Reduces dust and air quality problems (Baker et

al., 2002)

• May reduce the cost of carbon offsets by having

income streams from co-benefits

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Rangeland management in California

• 52% (5.8 million hectares) of CA agricultural land

is pasture and range

• Well managed perennial rangeland can increase C

sequestration (Follet et al., 2001)

• Several management strategies are likely to

increase soil C

• Re-seeding to deep-rooted perennial grasses
• Developing water supplies for livestock
• Intensive grazing management

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Rangeland management in California

• Initial investments required to improve

rangeland and management

• Improvements will benefit CA livestock industry

(Beardsley, 2001)

• Ranchers interested in additional revenue

sources to enhance profit margin (Coehlo, 2002)

• Vast potential for low cost C credits