Carbon Credits and Soil Health: What Growers Need to Know

0:00 I don't know, probably eight years of Ryan. I suppose he was the agriculture program director for the National Wildlife Federation, and they did some really good work on soil health and on cover crops. Back in the day, I had some really good meetings that brought together a lot of people just to think about cover crops and talk about cover crops and cover crop adoption.

0:27 I've really appreciated Ryan's passion and commitment not only to agriculture but to regenerative agriculture before we kind of started calling it that. We just called it soil health and cover crops. So he's been in this for quite a while and has deep background from a producer perspective, and that's the thing I've always appreciated about him. He's always come at it with the producer's perspective in mind.

0:57 In fact, I think Ryan, you operate some farm ground there in Wisconsin now, don't you? So you are a producer at heart, and I've always appreciated that.

1:07 We wanted to have someone talk about carbon because it is such a hot, popular topic right now. Indigo Carbon has probably made as many headlines as anybody in this space, although there's lots of other players getting into that game right now.

1:23 So we wanted to have Ryan just talk about carbon sequestration, the Indigo Carbon program. A lot of what you're going to talk about will be general carbon sequestration things, but then you'll have some very specific things about the Indigo program as well.

1:41 So I'm just going to turn it over to you. I know you've got some slide deck information to share with folks. I've got some questions at the end that I'm personally curious in, and I want full transparency here. I'm a little selfish because I want to know this stuff on our own farm. We haven't done anything with carbon sign up yet. We're looking. We're very interested in learning more.

2:07 If I want to learn more, I bet there's a lot of other people out there that want to learn more too. So this was kind of a selfish schedule for myself because it's an area that I'm very interested in.

2:17 So Ryan, we're going to turn it over to you. Go ahead and share your slide deck and start telling us about Indigo Carbon.

2:25 Yeah, I'd be happy to. Can you maybe let me share my screen real quick?

2:38 All right, let's go with that. Everybody able to see that? Yep, you're good. Great. Yeah, well, I appreciate Keith and Noah hosting and always happy to talk about carbon and probably a lot happier to talk about regen practices and adopting no-till and cover crops.

2:55 Like Keith mentioned, I farm here in Wisconsin. We're now at 12 days where we haven't—finally today so we had 11 days where it didn't get above zero. So that's the nature of where we farm. I added no-till and cover crops in my operation 10 years ago, just recently added perennials, and looking to add contract raising. So continuing to try to push forward on my own operation.

3:24 But you know, that's not why you're here today. You're here to learn more and understand about carbon opportunities for your operation.

3:32 So what I'd like to do is share a little bit about that, and then Keith and I will have a conversation. I think Keith set it up well that he's a grower who's looking at this, so I think he's going to ask just the right questions that's going to be really helpful for everybody.

3:54 A lot of this is not going to be new for most folks when we talk about regenerative or soil health. There are multiple benefits. Simply get you some cash, but let's help you along the way and let's see what the entire value is.

4:21 I'll talk about what some of that support looks like, how we've brought together science and technology predominantly in how we quantify that carbon to get you as much value as possible and to retain that value as much as possible, and then how do we use some of that data to continue to build your farm to where you would like it to be into the future.

4:49 We do have to take a step back though, and I'm sure there's a lot of you out there that

4:54 Probably remembered the Chicago Climate Exchange, or what was called like CCX, something like that. So this is what, 10 years ago that it finally had died. This was a first attempt at a carbon market.

5:11 What happened with that one, some of you may recall, but just to make sure we're all on the same page, they got really excited and they started generating credits and rolling growers. They were crediting new practices or carbon sequestering practices multiple years back in time. And then what happened is the market on those credits went from seven dollars or eight dollars per ton equivalent to seven cents per ton equivalent. Basically they became worthless.

5:43 To us at Indigo, there's a really big lesson in there of what not to do. And so we spent some time peeling back the very rotten onion that was Chicago Climate Exchange and understanding that one of the core failures of that effort was that they did not allow for additionality, or they basically were generating, giving credits to anybody that had done anything in the last 10 years. That's great for us as growers until the buyers don't see the value.

6:22 Take a look at that quote in that bottom corner there. If the buyers don't know what they're getting, if they're getting something that they really wonder about, it's just like anything else that you and I would buy at any grocery store or anywhere else. Like if I don't know what I'm really getting here, if I doubt the quality, why am I going to buy? And so the demand has dropped out of the market on that one.

6:45 And so we are very cognizant of that, and one of the core pillars of the Indigo carbon platform is that we want to give buyers absolute confidence that what they're buying, they're getting. What that means for us as growers is that we will always have the strongest possible market for our credits through Indigo carbon.

7:17 So the way that we've accomplished that is to develop partnerships and develop new methodologies, or the way in which we estimate or quantify the carbon sequestration, how we do all of these little details and ins and outs of the program, and had a third party, so Climate Action Reserve and FARAH, put their seal of approval, their stamp of approval on that. This is what we test. We say this is a lot like the USDA organic symbol that customers in the grocery store can see that symbol and they can have confidence because they know that it's been attested to by somebody who doesn't have an interest in the sale of that product. They have an interest in the dependability of the quality of the products in the marketplace.

8:09 So what we're seeing, and I'm sure just like Noah started out, that this is a growing trend and we want to be prepared, not just to take advantage of the immediate opportunity but the long term here. There is reasonable expectation that there's going to be growing demand for carbon credits. This is not going away in terms of a marketplace opportunity for entities and businesses to be more competitive in getting customers. So until the supply comes up, that price will continue to grow. Indigo carbon is currently sold out of our previous year's carbon credits. To us, that's a sign that there is good growth and good demand.

8:58 So we're very hopeful of that, but again, the important thing I think for everybody as producers needs to remember is which program, and to ensure that whichever program that you choose to work with is set up to protect that long-term value and to take advantage of the opportunity of that growing market. Are they setting you up to get top dollar?

9:27 So yeah, like I mentioned, we are getting a lot of buyer agreements, and I know some of you probably have some questions out there right now. Is there an established marketplace, established market price for these credits? And the answer is not yet. This is still a growing market, it's still a young market, relatively speaking, where credits are not yellow number two corn. Like we, they're not graded that easily. When we start seeing the grading, that's when we could start seeing that sort of marketplace and immediate pricing occur.

10:09 The simple metaphor that we like to use when explaining Indigo carbon relative to other options is that this is basically the top quality grade of carbon credit that you can find, which means it's going to get top

10:21 Quality and top price for growers. Certainly the carbon credit is a nice additional income stream and we talk about that quite a bit. We're excited to offer that to producers and help make that part of their regular income stream. But if you've heard Keith's talk about carbonomics and a lot of other growers talk about regenerative practices and soil health practices, I'll certainly attest to this as well: cost of production goes down, other risks get managed better and more effectively.

11:07 When I switched to no-till and cover crops 10 years ago, after a couple of years it became very clear that in my heavy clay soils where we get a lot of moisture, this in fact was an advantage to me. I could get out into my field two, three, four days sooner than my neighbors and get planting done, get harvest done, and there would be times when they went through an entire season and missed the planting season, just had a prevent plant because of that. I when I did not have to take a prevent plant, so there are a number of opportunities here to maximize the value.

11:49 I'm going to be totally honest, yeah the current price for carbon credit probably isn't going to be terribly exciting. We're looking at 10 to 15 dollars per credit right now for growers. Obviously like I mentioned, we're hoping and the signs are indicating, pointing towards that price rising. So some of you who are thinking about adopting these practices are probably going well, 10 or 15, maybe 20 bucks an acre, what is that to me? My goal here is keep in mind all of the benefits that you're going to get here. The price of that carbon is just a nice added benefit to help you make those changes possible.

12:35 All right, let me take a few minutes to walk through the process. I think a lot of folks are probably wondering well, what does this really look like for me? Like, might have some interest here but is this really cumbersome? Is this a big headache? Is it worth it? Is that process worth going through? So we'll try to lay this out real easily right here. So the first step is to sign up. Doesn't take much effort at all. In that process of signing up, you'd simply provide your contact information, some other basic details, and then start mapping out your fields on our Indigo Carbon platform, and that's free to use on the web, really easy to maneuver and access. I've signed, I've put my fields in there, it's really easy to use.

13:26 Then the next step is to plan, so start figuring out what it is that you're going to do in terms of adopting new practices. I'm going to lay out again what that means because I think we have some questions about what qualifies. Then you'll actually implement them, so again on your farm, and then submitting the documentation. And this is, I want to level set with everybody here, this is universal that any carbon program is going to require this if they're going to generate good, high quality credits. If they are telling you that you can sign up and you have no homework in terms of documenting anything, that's going to be a challenge for any sort of long-term value and you may be stuck in a bad situation.

14:18 The next three steps here, this is all on the Indigo side where we do random sampling for soil tests to improve our model accuracy over time, and then we send these credits to registry verification and issuance, sell them, and then we get the money to everybody participating.

14:45 All right, let me just walk through these really quickly. So this is what that platform looks like at Indigo Carbon, so real easy to use like I mentioned. This takes a couple of minutes. I think a unique feature that Indigo has is that we offer help as if you're just starting and thinking about this or if you're right on the beginning phases of implementing some of these practices such as no-till or covers. We have agronomists available to help you and so they can offer helpful decision tools, other insight into different practices, their own experience, or even connect you with growers who have maybe done what you're looking to do. So the easy solution here is come to Indigo Carbon. We have the assistance to help you and the insight and the expertise to make sure that

15:45 This is as easy as possible. A fun thing to do is to follow some of these agronomists on Twitter. They're always sharing their insights on social media. So if you find somebody in your state or region, just follow them on Twitter and you'll see what they're up to. It's a great chance to learn from some really good experts.

16:10 I think where there oftentimes is a lot of confusion is well, what exactly qualifies. Let me clarify that. In terms of Indigo Carbon, we have to meet additionality, which is the start of a new practice that increases your carbon sequestration rate. So if you're doing tillage and you go to no-till, that qualifies. I'm sure some of you are asking what if I'm already doing no-till. Okay, so then there are options in there.

16:47 For example, maybe you can start planting cover crops. Or you say well I'm already planting cover crops, right? So what do you have for me now? Okay, so now we're starting to get real specific. If you look under that planting cover crops category, if you plant them earlier or terminate them later, basically extending the growing season, the longer you can have something green and growing, the more carbon you're putting into the soil. That means you're going to be generating some carbon credits. So there are a lot of different ways that you might be doing some really good stuff, but there's likely a chance where you can find a little area in here to increase that rate of carbon sequestration.

17:36 On that data side, we like I mentioned have our platform to receive that data. We have carbon customer success team members who are able to help you through that process. They have an intercom button on that website. So when you're in your account and you have a question, you click on that intercom button and Morgan or Todd will pop up and talk you through it. It's really handy to have. So we want to make sure that you have those resources and that guidance to simplify that process in the future.

18:11 Our goal is to continue to make that easier and easier. So if you have data in existing platforms such as Granular, My John Deere, and others, we're working to create interfaces with them so that it's just a simple upload of data to provide as much data as possible before you have to manually enter it.

18:36 I just want to close with this. So if you're looking to get started, simple, indigoag.com. There's lots of information on there for you as growers to take a look at to sign up. We also have a number of webinars on there.

19:18 October 25th we have a webinar featuring Laura Wood Peterson, our director of government relations, to talk about the implications of the new administration and where carbon policy will be going into the future and the implications on carbon market opportunities. So what I want to do here is put that in the chat so that if you're interested in attending, just click on that and you'll be able to listen in. That's on February 25th. I think it's a great opportunity to learn and understand more about what exactly should we be expecting from Washington in terms of will this help, hurt, or do nothing. It could be one expectation of government in terms of carbon market opportunities.

20:17 That is a great point. I think a lot of people are wondering, we hear a lot of rumblings out of DC about reallocation of money from this pool to that pool. So it'll be really good to have an analysis of that. Will she talk a little bit about the Growing Climate Solution Act that's moving through Congress as well in addition to other things? Yeah, so our goal on that webinar is to address all these uncertainties that we have. Okay, so what's all in that bill? What does that mean for how USDA will interact with some of these carbon markets? Will they try to replace them? Will they try to do something to slow them down and regulate?

20:58 In some way will they try to do some other strategy? We're going to try to answer all of those questions.

21:06 All right, you ready for some questions? Let's do it. Okay, so I've got my questions in first before other people get to ask. Now you talked about with the old Chicago Climate Exchange that you know you were able to get paid on things that had accumulations in the past, if you will, right? Does Indigo Carbon do you get any credit for any of those past practices or is it just starting here and moving forward?

21:33 Yeah, so we have been able to build in what's called a look-back period up to two years for growers signing up. So when you first sign up, if you started doing something this past year, that would work now. Obviously, the cleanest and simplest way is sign up and start implementing the new practice, but we recognize that because the idea here is that carbon markets are in flux. They're not necessarily readily available across the board. So how do we treat everybody fairly? So I think some of the agreement is coming down on that two-year look-back period.

22:16 Okay, so there's some credit available there. And then now I know that on one slide you talked about if it's an existing practice, you don't really get paid for that. It's the additionality type thing. When you go through the sign up, do you say what are the things that I'm currently doing? And then does it give you an indication of how many tons of credits per acre you can potentially be eligible for based on the information that you give?

22:47 Yeah, so we're working on so all of our agronomists currently have a carbon estimator tool. And so if you have that question right now, what you can do is reach out to those agronomists and they'll take a look at just like you said, you know what is my baseline, what am I looking at? So then we can kind of figure out what is that new sequestration rate. Our goal is to eventually get that out so that it's just readily available to everybody and it's a simple look up, but we want to make sure it's strong enough and robust enough that it's of the standards that we're looking to accomplish. So we don't want to send out a subpar tool for people to use. That doesn't help. So we're still developing that, but for the time being, just get a hold of one of our agronomists and they'll happily help you in that process.

23:34 Yeah, and I really liked what you said about the what you get paid for carbon is kind of the icing on the cake. You shouldn't necessarily implement these practices just to get a carbon credit payment because if you do that, you know you might or might not come out ahead. But you're totally right. If you're doing it for the right reasons and you see all these other benefits, you know, the reduced erosion and better soil aggregation, better infiltration, less weed pressure, you know, all of the things that we talk about in soil health, and then you can add carbon credits is kind of the cherry on top. So the program is really set up for getting people converted because on my ground where we've been doing a lot of these practices, I may be eligible for some, but I'm starting out at a higher level and so I wouldn't have as much potential. Is that correct?

24:32 Yeah, that's you know, and that's always a struggle with these carbon markets. The buyers, and rightfully so, they want to buy something that they could say yes, that generated that additional sequestration that we're looking for. They're just not interested in buying a credit that says oh you just bought a credit that was already going to be done. That they know that if they try to take that to their customers, the customers will accuse them of brainwashing, trying to take credit for something that's already happened or would have happened without them. So that's always that balancing act that we're trying to figure out. I mean, I've been doing no-till and I plan to do that, but you know, that's just the nature of the challenge. And hoping to give more products and more opportunities for the growers that have been at this for a long time. So I know that some programs, some carbon programs, they pay for the actual sequestration, you know, taking.

25:41 CO2 out of the atmosphere and putting it into the ground. Some are also giving some payments or credits for, I believe it's called abatements. You know, and things that you're not actually doing. So if I reduce my nitrogen, I may not actually sequester carbon, but my carbon footprint is smaller because I'm not putting that extra 40 pounds of nitrogen into the soil.

26:05 Does Indigo Carbon recognize those abatements as well? Yes, and that's a great point, Keith. That anybody who's looking at these carbon programs should ask that question that Keith asked right there. So it's not just about carbon going into the soil, it's about reducing the emissions that are already going from the fertilizer to the atmosphere. And our program gives credit for both.

26:39 Say I'm a new grower, I get into the program. I change these practices. Am I getting paid based on estimates? You know, is there some theoretical formulation based on practices in my climate and where I'm at? Is that a theoretical calculation or is somebody actually coming out and pulling soil samples and looking at my organic matter levels and doing actual ground truthing or actually checking carbon? How does that work?

27:12 Yeah, so this is a perfect question that anybody who's talking with carbon programs should be asking. And so the way that we handle this, there are two ways, actually three or four ways to handle this. One way, one option of quantifying carbon is to use the purely model base. So we've got all this data out there on what practices and what soils and what climates will sequester carbon. We can identify your location and we'll generate an estimate. It's purely an estimate. Now it's really easy to use, it's low cost, but the accuracy, right, is maybe not there.

27:58 On the flip side, the other end of this spectrum is that you can use 100 percent sampling. So for every field that is enrolled, you get out there and sample. Now it's going to be perfectly exact and it's going to be really expensive, so that there will be no value left in the carbon credit. So the question becomes how do we resolve this? Yeah, so right, there's no easy solution with those two.

28:25 So what we tried to accomplish then is a slight combination of the two, where we can capture the benefits of each. So our methodology uses a model that is informed by random sampling so that it continues over time to increase its accuracy and it's checking the accuracy of the model itself. So for growers that enroll in Indigo Carbon, roughly about five to ten percent will get soil samples. But that's again, the purpose there is to inform the model so that it's accurate for everybody. That brings our costs down so we're able to get more money to the growers, and at the same time have some pretty decent accuracy.

29:10 So the model will get adjusted throughout the years as you're doing more of that ground truth thing. Are you looking at doing any remote type sensing? You know, satellites or drones or any of that kind of thing to verify either practices or, I don't know if they've got the technology yet to try to verify from remote imagery, you know, verify actual carbon in the soil. Where is that line of thinking taking you?

29:43 Yeah, I think on that question of remote sensing of carbon, I think the technology is a ways out on that. I think there's potential down the road for that. We do have our Atlas satellite, and our goal with that is, I think for me at least, I would say that our goal is predominantly to ease the data upload experience to make that easier for growers so that if we can attest that somebody's been doing no-till, we can see that and we can simplify that process for your experience. And on the flip side, one of the values there is that we want to make sure that Indigo Carbon credits are considered high value and buyers can trust that.

30:33 So when something happens, you know, let's be honest, there are some people out there who will try to take advantage of these programs. We want to make sure that we see that so that we can maintain the integrity for everybody else. And so that way, that can be very helpful for boosting the value for everybody.

30:52 Yeah okay so once I get signed up, I get accepted into the program and I get started. Is this a five-year contract, is a 10-year contract, how long am I locked in for? How long, you know, is there some, you know, do I have to prove that I left that carbon there, you know, because what if I go out and I till that ground after I did three years of no-till, you know, I really kind of released that carbon that I already. Is there a penalty for those sorts of things, how does all that work?

31:25 Yeah so again, Keith, your questions are spot-on tonight. You know, my 123 friends that are with me, they're just alone. Yeah, well everybody can appreciate then what you're accomplishing here is you're asking the perfect questions. So yeah, so for Indigo Carbon for growers just signing up, it is a five-year agreement and those payments for those carbon credits vest over five years. So what that means is in the first year you generate the carbon credit, so then it takes a little time to do the verification and the data. So that first year of payment, so year two in your program, you get paid 50 percent of the value of year one carbon, now as long as you maintain that year one carbon in the soil, the value that you keep getting paid. So your second year payment is 30, and then 10, 10, 10 for the next. So total five years that gets paid out.

32:36 That accomplishes a couple of things for us. So one is that provides us with some insurance. So in your example, let's say Keith, that you had, you know, you decided hey, I'm going to till this up after three years in the program. So theoretical I would never do that, but right, let's be clear here, we can all, you know, it's not going to happen on my crown. We all know yes. Just asking for a friend. Yeah, no. So with that payment vesting designed as it is, in the event that that happens, we can say we can look everybody in the eye and say that we are at no point would we ever come back and try to get money back from you. Now your payments will stop going forward and until you bring that soil back up to the carbon rates that would have been expected, your payments will remain suspended. But what that means is you have the potential to, okay, you can if you need to for some reason, back out and if you want those payments to resume, get back in, get the carbon back going, and then the payments resume.

33:48 Okay and so once I sign up, I'm in it for, is it a minimum of five years after you know, after five years, is it just a year by year, I can keep going and we just keep evaluating the practices and it just keeps getting better and better? Yeah, that's exactly right. You know, our goal is try to find this balance of maintaining flexibility for growers. So our initial offer was 10 years and we thought that's kind of a big commitment. So we were able to continue to tweak and refine and we've got that offer now down to five years. So it's a little easier to swallow for those who are just new to these practices. And then secondly, like you said, it has that flexibility on the back end, it's just a year to year after that. And as long as you maintain those practices, they're going to keep generating credits. So you're 17, you've generated your 17 credits, they'll get paid out through the next five years. You're 18, you're 18 credits paid out over the next five years.

34:52 Okay and once I'm in the program, you know, because you kind of throw around, I've seen that number thrown around, you know, 15 to 20 dollars a ton on that carbon, does that price fluctuate every year within those first five years or is that a locked in price for those first five years and then it fluctuates? And how is, are you just setting that price once per year, or how is that price determined, I guess? Yeah, so we are right now, like I said earlier, it's you know kind of a new market and it's based on the purchase agreements that we generate from our carbon partners. Our goal is and what we're doing now is setting a price each year, and obviously the goal is to increase that price over time. What we try to do is put a floor on that for growers, so okay, that absolute minimum of what you're going to get, I think we've set that at ten dollars. Now, in the event that the prices start going up, we know that we always have to be competitive.

40:45 Reducing their carbon footprint and if they come anywhere near to fulfilling even a portion of that, they're going to have to—I mean there's literally trillions of dollars that have to be spent in order to get these companies anywhere close to their goals. So I feel like demand is going to be strong and I'm excited that there are options for people because it's not a one size fits all kind of a thing.

41:10 Yeah, great job Ryan. Noah, I'm going to turn it over to you and let you bring in audience questions from the chat box, from the Q&A box, and I know there's a few on Facebook potentially too. So I'm going to turn it over to you to go ahead and finish out our time here with questions.

41:27 Yeah, and I kind of have a feeling in advance we're not going to get to all of these, so what I'm going to do is try and piece together a lot of the common topics. One of which—just wanted to clarify: are you measuring the carbon sequestered in the fields or are you paying the credits based on the practices?

41:49 Yeah, so good question. So we are paying the credits based on the sequestration and not necessarily adopting specific practices. We know that cover crops in southwest Kansas are going to sequester a different rate compared to cover crops in north central Wisconsin. So it's being cognizant of what's actually happening in the field.

42:13 Okay, do different soil types yield different carbon credits? They do, and for those of us not in the central corn belt of Illinois and Iowa, we can all be jealous of their soils for yet another reason. They just have soils that are blessed, and that's just the nature of it. Those soils have capacity to produce bountiful crops relatively easily, and similarly to sequester carbon relatively easy compared to other soils.

42:46 Okay, questions about eligibility—as far as is there a minimum number of acres to participate? And then looking at like pasture ground, CRP, those kind of options, what are the stipulations for signing up?

43:02 Yeah, so we've recently been able to reduce our acreage minimum. What we ask is that growers have control of a minimum or farming a minimum of 150 acres. Now that doesn't mean that you have to put all 150 into the program, but that's where we're starting. In terms of pasture land and CRP, so a couple of stipulations there: that we currently don't have a methodology for granting credits for improving your pasture management. So if you're going from continuous grazing to rotational grazing, that would increase carbon. We're still working on getting that methodology together to give you the credit for that. And similarly, CRP being a reserve program, CRP acres once you're enrolled in CRP they don't qualify for carbon.

44:03 Okay, how about grassland only for grazing with no cropping? Yeah, so like I mentioned, we're working on trying to get the methodology. I know we've got some teams working on that. So stay tuned, sit tight. But our goal again—we know there's a really big opportunity for improving the management of grasslands through grazing, and so we want to definitely get there to help make that possible for everybody.

44:29 Okay, who is the leader or leaders for the protocols quantifying the proposed sequestered carbon? The leaders—can you clarify that for me Noah? I'm assuming in this regard is who's setting those protocols, who's making that decision on quantifying how much carbon is being sequestered?

44:56 Yeah, so these procedures—so Indigo develops the procedures and then we take that to the Climate Action Reserve and Vera, the registries. They will do this deep dive, intense look into those procedures, and part of that involves bringing in experts from around the world to take a look as well to make sure that we're doing a good job and are proposing something that's really solid. Then there's this long iteration process where it continues to refine until everybody feels comfortable and confident with that, and then we're able to offer that as a means of generating carbon credits.

45:41 Okay, can you explain the difference between carbon sequestration and carbon storage? Yeah, so the sequestration is actually pulling that carbon dioxide out of the atmosphere and putting it into ground carbon storage.

45:56 Would presumably assuming that there is no additional sequestration going on, it's just maintaining the carbon that is in the soil so we are not releasing any more into the atmosphere and as we know with a tillage pass, you're oxidizing the carbon when that soil becomes exposed to.

46:29 Well it cut out there for a second, sorry about that. No that's fine, it was just kind of the last time in Wisconsin that you're freezing up. Yeah it's so cold even the internet's freezing.

46:43 Tom asks, we get paid for a credit, then do we get paid for storage after that first year or will that ton be allowed to go after five years, then resell a new time later.

46:56 That's a good question, Tom. So our goal again, so you have to in order to continue to receive the full vesting and you mentioned the five years, so you've got that part. The goal there is that we maintain that carbon in the soil, so as long as you are maintaining your practices that generated that carbon, that initial carbon credit, you'll still continue to qualify for new carbon credits.

47:24 I think to answer that second part of your question, what if there are people out there that were going to do five years with Indigo and then get out for a couple of years and do five years somewhere else. So one is that everybody's looking at baseline practices, so it won't be that easy to be jumping around and get that fresh set and that fresh set of opportunities. So that's a reality of the carbon programs and that's a good thing, right? That's to make sure that nobody's gaming the system and to make sure that the buyers can have confidence in what they're buying, because if they don't have that confidence, we don't have a market and so we are very careful about that and we want to make sure that others can't sort of play that game and ruin the market for all of us.

48:16 Okay I am assuming that this next question will be addressed in the webinar but if you have more to add that's fine. Wondering about what protocols the government is going to push the farmer to do. You want to touch on that or would you just address them to that webinar.

48:32 I can try to touch on that, I want to balance this, tease just enough that you go to the webinar too. So I would say that the government isn't going to be in the business of protocols, they are going to be playing different roles, so to hear what those are, go to the webinar on the 25th. Perfect, there you go, and for those that did miss that, it is in the chat and I will try to get the link to that posted if you're watching this recording as well, I will put that up there.

49:07 Lauren asks, well let me see here, I'm going to skip that one. What price per metric ton of carbon sequestered is Indigo paying and over what timeline? You did address that but just for those that are tuning in now if you want to kind of redefine that. Yeah, so our target here is 15 per ton, I think we set a minimum of 10, so that will be the absolute floor for anybody signing up and obviously going forward we see a lot of market upside and we want to make sure that we can share that upside with everybody.

49:41 Okay, is this available in Canada? Not yet, I'm sorry about that. We are in the process of looking to expand our geography, both domestically and internationally, and we are in that process of looking at Europe, Latin America, and Canada.

50:02 Dale asks, what about planting crop land to perennial pastures? That is the fastest way to increase soil carbon. Will that be an accepted practice, Dale? Yeah, you know what you're talking about. So it is right, so we all know that getting perennials on the landscape and especially adding livestock, that is like the best way. So right now we do not have that methodology, we are working on expanding that. Once we have the grazing component, we will now be able to take into account adding perennials, getting livestock out there. So bear with us, that's in process, but we recognize that that's a great opportunity for everybody.

50:46 You did address this as well but just so that we hit it again, can I get a credit for the carbon I sequestered last year? Yes, so good question. So I would say sign up as soon as possible, you still technically fit that window of the look back period, but again, you know, our goal here is not necessarily to make use of that too often, the goal would be to sign up.

51:13 As soon as possible because that's when our credit buyers have us the most confidence that they are having an impact. So my suggestion to everybody is sign up as soon as you can and then implement the practice and then you'll be getting good quality credits.

51:32 Some questions about the validity of the models and that kind of, I'm sure you get that quite a bit, but which carbon component do you measure to keep the model corrected? Can you maybe give me a little more insight into that? Well, that was the strict question, but there's also another question kind of along the same lines. This issue has been on this person's mind: not being able to see any accuracy and actually measuring with the carbon footprint models that we currently have. So if you just want to touch a little bit more on what you guys are doing to make sure those are correct and that they're calibrated.

52:10 Absolutely. So our sampling protocol, I know that the team looking at that spent many months developing that protocol to get high accuracy. So that sampling protocol includes sampling to 30 centimeters, having a random sampling generation series for each field enrolled or each field that's sampled to include bulk density measures on at least 20 percent of those samples so that we're able to again calibrate accordingly. Because if you don't capture bulk density, you really don't know enough to have good confidence. So we take a number of steps to make sure that that sampling is as accurate as possible.

53:01 Leased land eligibility. Yeah, so this is actually, I would add this to Keith's questions to ask as you're looking at carbon programs and that is a question of how do you manage, how, what is eligibility for leased land? Within Indigo Carbon, as long as you can show us that you have operational control of that land, then you can enroll it in Indigo Carbon. Some programs require a number of documents and other signatures and things like that, and so it gets a little confusing. But what we want to do is say okay, if you're saying that you have control, we're going to trust you. If we need to audit or something like that, well then we'll ask you to provide some verification. But until then we're going to trust your word.

53:53 Okay, if I adopt a practice, is the payment a recurring annual payment? Yeah, so every time that you, so that the payments are reoccurring. So again, that vesting schedule is, so let's say last year you added, you went to no-till and so that generate it gave you one carbon credit per acre. So those will get that credit from 2020 will get paid out from 2021 through 2025. So that gets spread out over those five years. Then obviously this year you're going to maintain no-till because that's a smart thing to do for your operation. So you can generate a new credit and then that the payments for that credit from 2021 will get spread out from 2022 through 2026. So it just keeps getting pushed every year. So eventually once you've been in the program for five years, you're getting a hundred percent of the credit value every year because you've stacked those payments from multiple years.

55:01 Okay, another question from Bale. These are some of my favorites. Given that glomulin from mycorrhizae fungi is the most persistent form of soil carbon, other than biochar, will mycorrhizae inoculation be a practice at some point? Along the same lines, what about biochar?

55:25 Yeah, that's a good question. I think our modeling, you know, there's still some a little more research to be had on understanding the biological component of carbon. But obviously our methodology with using a model that's guided by sampling, and as long as we're capturing that data about whatever practices that you're adding, would eventually get filtered in so that we can start to identify, hey, that practice generates some decent credit. So our system sort of has a little bit of inherent learning to it, and we're still also looking at how do we fully understand what's going on there with the biology.

56:11 Okay, can you touch on rotating acres, rotating fields on the farm to fit that no-till cycle? I'm assuming it's per field, but touch on how that would work when you're rotating.

56:25 Yeah so in terms of crop rotation, I'm assuming that the question is maybe they're not continuous no-till, they might be rotational no-till, maybe no-till beans, strip till corn, something like that. Yeah so the way that works would be let's say you're in corn beans no-till, then you've added no-till to the soybeans and you're still doing the strip till on the corn, right? So you've got a new practice that is essentially every other year. So in your one field in year one you added the no-till to the soybeans, all right, so you're going to generate a credit that year and that'll get paid out over those future years. Now the next year that field goes to corn, that's strip till, so there hasn't been a new practice, so in that year there would not be any credits generated. Come back to soybeans next year, okay, that's back to the no-till that you added. That's going to generate some credits.

57:27 Daniel asks, can we enroll a certain percentage of acres of first year and then another percentage in years to follow? I'm not sure if he means decreasing or increasing but I'm going to take that as increasing. So yeah, the simple answer is the minimum is if you have control of 150 acres, you're farming 150 acres or more, enroll one field, that's, you can start at that very basic level and then you can add fields as you see fit. So we want to maintain that there's good flexibility in there for everybody.

58:04 This is a question I've had as well. Some, I appreciate this from Luke, says the companies that are buying the credits, how are they utilizing them? How are they making money off of them? Is it tax breaks, marketing, what is their purpose for buying these credits? Yeah, it's a good question. In terms of the buyers of the credits, this is not a tax break for them. What this is is they have made commitments for the purpose of meeting the market. Where the market is, they know that if they want to remain competitive in whatever market, if that's coffee, any consumables, if that's even consulting firms, if that's tech, finance, there are a lot of companies that are realizing that their customers are preferring to work with those that are addressing climate. So they know that if they are going to remain competitive, this is going to be the cost of trying to remain competitive. So for them this is an investment into making money for the main line of business.

59:12 This will be the last question and then we'll wrap up. Tim says, so if I adopt practice X in year one, at year six I no longer get paid for that practice in the future, is that correct? So yeah, to Tim's question, this is kind of a question of investing and the payment schedule. So yeah, if you started that practice in year one and you're now in year six and you're still doing it, yes, you've been paid out for the year one credit. In the meantime you've generated credits in years two, three, four and five and you are now getting paid on those. So as long as you maintain that practice, that system will continue forward.

59:54 Well, I will wrap things up there. If there are any questions that we did not get to, feel free to email them to me. My email is just noah at greencoverseed.com and I can forward those on here to Ryan and help get them answered. But Bella, you did a great job, that was a lot of questions that we gave to you and I appreciate you taking the time to answer those. I feel like at least on my end I have a much better understanding of the program and the benefits that you guys have, so appreciate that. And again, if you guys are interested in learning more, you can go first of all sign up if this is something that you're interested in and then also check out this webinar that Keith posted as well on there and we will post that on the recording.

1:00:43 With that, Ryan, Keith, do you guys have any closing thoughts? Yeah, I just want to thank you both and thank everybody for participating. It's always fun to talk about carbon. I always, it's more fun to talk about the regen practices themselves, but I know this is where everybody's got a lot of questions, so I'm happy to help and certainly happy to answer any questions going forward. And so if Noah, no, feel free to send questions my way and I'll answer them as well, but thanks again. Yeah, thanks for coming on Ryan, we appreciate it and thanks everybody for joining us. Have a great evening and stay warm out there. Yeah, next week we're going to have Lauren Steinlahgy on here, so we're excited for that as well. It'll be the same time at 5:30. Hope to see you guys all next week. Take care.