Why Tech Companies are Investing in Soil Carbon Removal

Soil carbon allows farmers to monetize their ecosystem services, while investors are increasingly interested in natural climate solutions and corporations are starting to buy soil carbon credits. This week, we will start by diving into what Shopify, Microsoft, and other major soil carbon credit buyers look for in soil carbon credits and why soil carbon presents an appealing option to their portfolio.

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Companies buy soil carbon credits to offset their own carbon emissions or go carbon negative. The government is not involved in regulating these credits, which can be certified by a carbon registry and verified through a third party. With agriculture credits, companies can choose from two types of credits: carbon removal, which represents carbon drawdown from the atmosphere, or carbon offset, which focuses on avoiding emissions in the future (like not using a chemical fertilizer). Shopify and Microsoft took the lead amongst major tech companies by supporting agriculture-based solutions to combat climate change. Along with Stripe, which focused on technical solutions, these companies have chosen to purchase exclusively carbon removal.

Microsoft’s approach specifically calls for “baseline and verification in-soil sample measurements,” meaning that they want project developers to dig into the soil and take samples to be analyzed by labs. Remote sensing and mechanistic models alone are simply not enough. Soil samples should be at least 30 cm deep, though ranchlands with healthy native grasses store carbon in deep soil beyond that. Microsoft also dissuades the use of any chemical fertilizer, emphasizing that nitrous oxide is 300 times more potent than carbon dioxide. Farmer equity and participation also matter as proper incentive structures and fairness allow soil carbon farming to scale.

Shopify, on the other hand, views soil carbon as needing rigorous scientific study. The key lever Shopify is targeting is “the development of monitoring and verification protocols and research science,” so that we know the amount of carbon that regenerative practices store in our soil for each project. Though Shopify accurately represents this skepticism, the potential of large-scale soil carbon storage combined with the numerous co-benefits of regenerative agriculture outweighs the drawbacks. With more data and demonstrated monitoring techniques, soil carbon farming has the potential scale.

Disclosure: Shopify has purchased soil carbon storage credits from Grassroots Carbon.

One emerging area of research unmentioned by both Shopify and Microsoft is the increasing likelihood of long-term permanence in soil carbon grazing systems. Permanence, which refers to the longevity of carbon remaining stored in the soil, is a key criterion for establishing a high-quality carbon credit. A recent study in the Journal of Environmental Management analyzed the impacts of regenerative grazing in the southeast and found “13% more soil C on farms under [adaptive multi-paddock grazing] compared to conventional grazing,” with that carbon shifting to mineral-associated organic matter over time, which is the most stable carbon pool in soil. This study and others demonstrate that continued regenerative grazing practices over time move soil carbon into the pools of organic matter in soil that take upwards of a thousand years to be released.  As the literature is beginning to demonstrate, permanence from soil carbon storage is on par with other long-term technological carbon removal solutions; however, these solutions can be much more expensive and lack the many co-benefits of soil carbon.

Credit: Jocelyn Lavallee

Overall, Shopify and Microsoft’s approaches emphasize the need for scientific rigor and extensive data collection in soil carbon credit projects to validate the enormous potential they have to remove carbon from the atmosphere. It is not enough to extrapolate from existing data - we need to actively monitor and measure the ground truth while supporting innovative technologies that reduce costs and increase transparency. All stakeholders, be they ranchers, registries, or buyers, should pursue projects that emphasize permanent soil carbon storage and push forward rigorous soil and environmental science.

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