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What is Carbon by Indigo?
Carbon by Indigo supports you in adopting practices that are good for your farm - and helps you get paid for the carbon credits you generate. Adding cover crops, reducing tillage, and other practices can help benefit your soil and your bottom line. And now, through Carbon by Indigo, increased soil organic matter or reduced greenhouse gas emissions from these practices can also generate verified carbon credits, which are increasingly in demand by buyers, such as major corporations.
What is a carbon credit?
A carbon credit is an offset purchased by companies and other buyers as one way to reduce their impact on the environment. As buyers make large-scale commitments to drastically reduce their carbon footprint, they want to purchase carbon credits - which represent greenhouse gases removed or avoided - to drive environmental change beyond what they are capable of today within their organizations.
Verified carbon credits are approved and issued by third-party carbon credit issuers, in order to demonstrate the validity and value of the credit to buyers. When documented with evidence, carbon credits make it easier and more effective for organizations to reduce total carbon emissions.
Over the past year, companies all over the US and organizations throughout the world have been making multi-billion-dollar commitments to curb their impact on the environment. As of last year, nearly one-quarter of all Fortune 500 companies have made a carbon neutrality commitment, an exponential increase over just a few years prior.
How are carbon credits different from other things I produce?
Carbon credits operate much like commodities. If you produce corn to sell, the buyer will want to know the quantity and quality. Grain handlers will want to facilitate that trade by meeting those information needs. So they weigh your corn and test it for quality so the buyer can have confidence in your product. Similarly, carbon credits estimate and track quantity through modeling and soil samples and protect for quality by creating stipulations on additionally and leakage. These quantification standards ensure the buyer gets the product they desire while the seller has a quality product to sell that earns top dollar.
What are the qualifying types of practice changes?
Adding cover crops (for the first time, extending the duration, or adding a legume species to the mix)
Diversifying your crop rotation
Reducing or eliminating tillage
Moving N fertilizer application closer to planting
When do I have to start new practice changes to qualify for generating credits?
Because carbon credits are sold the year after soil carbon is increased and emissions are reduced, credits are referred to as that year's "carbon credit crop." You can earn carbon credits on practice changes made up to 2 years prior to identifying them with Carbon by Indigo.
Why do I need to make a practice change? Why don't my existing practice changes count?
Two primary reasons:
Valuable carbon credits are in high demand, and buyers are only willing to purchase credits that demonstrate a change. Credits generated as a result of practice changes are valuable because they represent new benefits to soil carbon and emissions reductions, above and beyond "business as usual".
These types of valuable credits are extremely rare - that's why buyers come to Indigo and are willing to pay high prices. That's also why we're able to guarantee a limited-time credit payment minimum. Past carbon markets have been unsuccessful because buyers did not see the credits as truly valuable without the practice change requirement.
What information am I required to submit? What's in it for me?
Participation in Carbon by Indigo includes access to our free software platform for field data management. On our platform, growers can map and view field boundaries, and log and submit the farm records that are ultimately needed to calculate credits.
Farm records include 3-5 years of historical as well as current season details about planting and harvest dates, fertilizer types, amounts, and application dates, and tillage types and dates, as well as information on cover crop types, dates, and planting and termination methods, and organic amendments where applicable.
Read about our Data Integrity Policy here.
How much will I get paid?
Carbon by Indigo is designed to provide maximum benefit to farmers, giving them at least 75% of the carbon credit revenue from each carbon crop, while providing the security of a minimum payment rate per credit. Growers now receive a guaranteed minimum payment rate of $20 per credit generated. In recent crop years, we paid growers $30 per credit. We project the actual grower payment per credit to continue to rise over time.