Improved Agricultural Land Management (IALM) Methodology: Frequently Asked Questions (FAQs)

The IALM methodology provides a more comprehensive and flexible approach to the quantification of greenhouse gas (GHG) benefits compared to other published ALM methodologies. Most other methodologies focus on a single GHG source or sink such as soil organic carbon (SOC), nitrous oxide (N₂O) from fertilizer use or enteric methane (CH₄), or a single ALM activity such as grassland management. In contrast, the IALM methodology allows for quantifying SOC stock change and N₂O and CH₄ fluxes associated with a range of ALM activities such as improved water, residue and livestock management, as well as reduced tillage and fertilizer use. It also includes a novel combined measure and model quantification approach that uses SOC measurements to set the baseline for modeled estimates of SOC stock changes.

This methodology includes the quantification of CO₂, CH₄, and N₂O. To be eligible for crediting, project developers must demonstrate the implementation of project activities that reduce and/or remove these GHGs.

Eligible project activities broadly fall into one of the following categories:

• Reduced fertilizer application;
• Improved water and irrigation management;
• Reduced tillage and improved residue management;
• Improved crop planting and harvesting (e.g., crop rotations, cover crops); and/or,
• Improved grazing practices (e.g., rotational grazing).

The methodology is applicable in any geography globally that encompasses land that is either cropland or grassland at the project start date and remains cropland or grassland throughout the project crediting period.

At present, agriculture is a net contributor to atmospheric GHGs, representing over 10% of annual global emissions (Climate Watch). Further, many conventional agriculture practices degrade soil health, water quality, and other environmental services. Regenerative agriculture is an alternative approach to land management which encompasses a suite of activities proven to promote SOC sequestration as well as enhance soil and watershed health, and agricultural resilience. A rapid transition from business-as-usual agriculture towards more holistic regenerative practices is critical to achieving a <1.5 degree celsius increase in global warming and sustainably feeding the world.

There are a variety of ways by which the improved ALM activities credited in this methodology reduce or remove GHG emissions. For example:

• cover crops, crop rotations, and reduced tillage all increase soil organic carbon (SOC) stocks;
• improved management of inorganic nitrogen fertilizer and irrigation water reduces N₂O and CH₄ emissions; and
• where livestock are part of the system, improved grazing and manure management can increase SOC stocks and reduce N₂O and CH₄ emissions.

Throughout the methodology development process Verra sought input from a wide range of independent experts and stakeholders ensuring a rigorous process. The methodology was developed in accordance with Verra’s Methodology Approval Process, which includes multiple rounds of review, a 30-day public comment period and review by an approved validation and verification body. All comments received were addressed and responses posted. Furthermore, due to the technical nature of this methodology, Verra took additional steps to ensure the robustness of the approach. Specifically, Verra hired a third-party consultant from a leading agricultural university to advise us throughout methodology development and sought input from members of our Agricultural Land Management Working Group, a diverse set of independent leading experts well-versed in the monitoring and implementation of agricultural carbon accounting.

There are many ways through which farmers will benefit. First and foremost, research shows that implementation of improved ALM practices can lead to enhanced yields — and by extension, income gains — after an initial transition period. Second, participating farmers will receive a range of technical support from project proponents, giving them access to the requisite knowledge to implement innovations on their farms. Lastly, depending on their performance and the financial structure of the project, farmers may receive a share of carbon revenues from sales of VCUs generated by the project.

In most cases, the most cost-effective way for individual farmers to participate in an IALM project is to join an aggregated project managed by a carbon project developer. These project developers bring together multiple farms in a single project to achieve the economies of scale needed to make offset project development feasible. If an aggregation firm sets up its project as a “grouped project”,  individual farmers can continue to join the project subsequent to project validation (i.e., the initial independent assessment of the project by a validation/verification body [the auditor] that determines whether the project complies with the VCS Program rules and with the IALM methodology requirements).

No. Only new or expanded activities are eligible for crediting.

The IALM methodology uses a project method for the demonstration of additionality. Project proponents are required to demonstrate that the suite of project activities being credited:

1.  Are not required by regulation;
2.  Have implementation barriers such as equipment, cultural practices, market conditions and social norms; and
3.  Are not common practice, where common practice is defined as greater than 20% adoption (in accordance with the CDM Methodological Tool for Common Practice).

Individual activities with an adoption rate of less than 20% in the state/province (or equivalent 2nd order jurisdiction) are automatically additional, while activities with adoption rates greater than 20% are only additional if the weighted average adoption rate of the three (or more) predominant activities in the aggregated project is lower than 20%. Adoption rates must be taken from publicly available sources such as agricultural census or other government data, peer-reviewed scientific literature, independent research data and/or industry reports. Novel approaches, such as this, were endorsed in an open letter from over a dozen leading soil academics and carbon policy experts.

The baseline scenario is determined by applying a historic look-back period to produce an annual schedule of activities that is repeated over the first project monitoring period. The historic look-back period identifies actual management activities on each land parcel included in the project scenario; it must be a minimum of 3 years and include at least one complete crop rotation, where applicable. For example, if the farm historically implemented a corn monocrop over the last 3 years, the historic look-back period would include the last 3 years of that crop and its associated management practices. Alternatively, if the farm implemented a 5-year soy-corn-soy-wheat-corn rotation, the historic look-back period would need to be 5 years to capture the entire rotation of those crops and their associated management practices.

There are three approaches to quantify agricultural GHG emission reductions and removals in the IALM methodology:

• Approach 1: “Measure and Model” uses empirical or process-based models to estimate GHG flux in the SOC pool, CH₄ from soil methanogenesis, and N₂O from use of nitrogen fertilizer and nitrogen fixing species. This approach requires an approved model as well as a range of data inputs including soil and climate characteristics, agricultural practices implemented, and measured initial SOC stocks.
• Approach 2: “Measure and Re-measure” uses direct measurements to estimate changes in SOC stocks. This approach is restricted solely to the SOC pool and requires a VCS-approved performance benchmark. Such performance benchmarks do not currently exist, and would need to be developed (in accordance with VCS Guidance for Standardized Methods) for projects to use this approach.
• Approach 3: “Default”, applicable only for emission reductions, uses monitored data on agricultural practices implemented and default equations contained in the 2019 Refinement to the 2006 IPCC Guidelines for National Greenhouse Gas Inventories to estimate baseline and project CO₂ flux from fossil fuel combustion and N₂O and CH₄ fluxes from enteric fermentation, manure deposition, biomass burning, and use of nitrogen fertilizers and nitrogen-fixing species (excluding CH₄ flux from soil methanogenesis).

The methodology addresses leakage in a few different ways:

1. The applicability conditions a) exclude project activities expected to result in a sustained reduction in agricultural productivity of greater than 5% — the de minimis threshold for emissions accounting — which could result in market leakage, and b) restrict the use of biochar (as an organic soil amendment) to situations where in can be demonstrated that the feedstock used to produce the biochar would have otherwise been left to decay in aerobic or anaerobic conditions or been burned in an uncontrolled manner.
2. The number of livestock in the project scenario must not be lower than the number of livestock in the historic baseline look-back period. Thus, if livestock displacement occurs, the CH₄ and N₂O emissions associated with livestock management continue to be counted in the project scenario to account for potential emissions leakage.
3. A 12% leakage deduction is taken when manure is applied in the project, but not applied in the historical baseline period. This deduction represents the portion of the manure carbon that would have otherwise been stored in agricultural land outside of the project area and is based on Maillard and Angers (2014). The deduction is not applicable if the manure applied in the project is produced on-site from farms within the project area, or if the manure is diverted from an anaerobic lagoon.
4. To ensure market leakage is not occurring after a project has started, every 10 years the project proponent must demonstrate that the productivity of each crop/livestock product has not declined by more than 5% in the project scenario. If leakage is deteched and the project proponent is unable to isolate the specific source(s) of leakage, then the entire crop/livestock product experiencing productivity declines becomes ineligible for future crediting.

All agriculture, forestry, and other land use (AFOLU) projects under the VCS must assess the risk of loss events using the AFOLU Non-Permanence Risk Tool. The AFOLU Non-Permanence Risk Tool determines the number of credits a project must deposit in the VCS pooled AFOLU buffer account. It considers internal (e.g., financial viability), external (e.g., political instability) and natural (e.g., fire, drought, flooding) risks specific to the project. If a known or presumed loss event occurs, buffer credits are cancelled to cover any reversals, which ensures the permanence of all VCUs (carbon credits) issued.

Atmospheric integrity is maintained because the AFOLU pooled buffer account, currently holding about 45 million VCUs from a diverse global portfolio of projects, covers (in effect “insures”) any unanticipated losses from individual project failures. Note, within aggregated projects, potential soil carbon losses on individual farms (e.g., through practice changes, whether temporary or permanent) are often made up by gains on other participating farms during a given monitoring period, in which case a net reversal is not recorded at the project level and the buffer need not be tapped.

The VCS buffer system covers both intentional losses (e.g., from management practice changes) that projects are unable to make up themselves during the crediting period, as well as unintentional losses (e.g., from natural events, such as fires). At the end of a project’s crediting period, its buffer credits are cancelled, which, when considered across the entire VCS AFOLU portfolio, covers potential future reversals that may be associated with issued credits from individual projects. The design of the system means that the permanence of the all VCUs is ensured without the need for project monitoring beyond the carbon crediting period. By removing overhanging, long-term liabilities for project developers and farmers, the VCS buffer approach to addressing reversal risks maximizes potential participation and the generation of permanent climate benefits.

Non-permanence risk analysis only needs to be applied to GHG removals or avoided emissions through carbon sinks. Project activities generating emissions reductions of N₂O, CH₄ or fossil-derived CO₂ are not subject to a buffer withholding, since these GHG benefits cannot be reversed.