Have Manitoba farmers been cut off from the developing carbon offset market in Western Canada?
The answer depends on who you talk to.
Keystone Agricultural Producers says they have not because the new environmental farm plans can pay for much of the cost of greenhouse gas emission measures with government money and there’s no Manitoba offset market anyway.
But organizers of on-farm offsetting programs say the provincial government’s decision to partially pay for projects but then partially pocket the offsets kills the chance for farmers to join the market.
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And just because there’s no market today doesn’t mean Manitoba farmers won’t soon be part of the Alberta-Saskatchewan market, or be able to sell credits to Ontario emitters when a market forms there.
“You step one province either way and you’ve got lots of demand (for carbon credits),” said Bruce Love of Preferred Carbon, which has built a covered manure lagoon emission capture system on a hog barn at Starbuck. Preferred Carbon collects and sells carbon offsets from Alberta farms.
Love said he and the Farmer’s Edge group of farm management consultants were blindsided by the Manitoba government’s decision to claim carbon credits arising from any projects it funds.
Beneficial management practices such as variable rate fertilizer spreading and covered manure lagoons can be funded by the provincial government within the new program, but if the province funds 70 percent of the work, it will claim 70 percent of the credits.
Love said it will stop the evolution of the carbon market in Manitoba and make farmers suppliers to the government, instead of taking money from the private sector to fund their emission capturing efforts.
“What’s wrong with an oilsands plant in Alberta paying for the variable rate technology that a farmer in Manitoba needs,” said Love.
But Manitoba farmers cannot sell their carbon credits and KAP president Ian Wishart says it’s better to have something guaranteed from the province in hand rather than count on a proposed market that may never come about.
“I think we’re getting a fairly good deal,” said Wishart, who lobbied for a program like the one the Manitoba government has implemented.
“We’re getting the value to the farmer for his carbon offsets now, where really there is no market for the Manitoba farmers to sell their offsets.”
Wishart said he doubts that a provincial or cross-prairie market will soon evolve, and three or four years from now a national plan may be implemented. Most of the provincial money only carries a four-year obligation for the farmer to hand over his credits (10 for a major project like a covered lagoon) so farmers could easily move into a national offset market after that.
“We’re actually creating a marketplace here,” said Wishart, noting that Manitoba has little chance of developing a provincial market because there are only two major emitters in the province.
“We don’t have any customers. We can generate the offsets, but if we have just Manitoba to trade with, we don’t have any customers.”
But Love thinks that would be the big gain for Manitoba if farmers were allowed to keep their credits and sell them in a cross-prairie market.
“This would bring money into Manitoba, rather than cost Manitoba money,” said Love.
He’s worried that the money his company has sunk into the covered manure lagoon may be lost if the new provincial program stops Manitoba from moving into a bigger offset market.
“I may have a stranded asset there,” said Love.
“We’re trying to build an honest, long-term business, so if there is more benefit in it for the farmer to go with (the provincial program), that’s clearly the direction we would push them in.”
