Fall Update 2023
November 2023
I’m reflecting on the fact that we have six years, six crops, and six calving periods left until the end of 2030. BCC (Biological Carbon Canada) remains dedicated to educating various stakeholders, companies, and decision-makers about the importance of a regulatory body and the challenges involved in placing a value on carbon data in the marketplace.
Below, you’ll find a summary of our recent efforts since our last newsletter. Additionally, mark your calendars for our Annual General Meeting on January 18, 2024.
Best regards,
Graham Gilchrist, Pag
CEO
Bill C-234
The Senate is asking questions. In September and October, the Senate Ag Committee has been examining C-234. What have we learned?
Finance officials admit the rebate under C8 for all fuel expenses was designed, on average, an amount to reimburse any levy for on-farm use of natural gas and propane. They also admit that leaving natural gas and propane within the levy system was a policy choice to ensure the agricultural sector sees a price signal, given all other farm emissions are not subject to any price signals.
Senators asked many questions about the technology frontier for grain drying and barn heating. Ministry officials told Senators that clean tech money is available only when the farm is ready to access the funds.
Witnesses continued to state that C234 is only a removal of the levy across all the testimony. Other emission reductions and technology adoption issues are better addressed in existing policy, new legislation, or policy initiatives.
Finance Canada officials expressed concern about overlap when a farm claims a tax credit and would be fully levy-exempt with c234.
Senators asked many questions about the difference between natural gas and propane price volatility and the levy. The levy is a unit bought x levy. The price of the fuel is separate.
Observations from all the videos watched.
- Senators need better briefs to understand farms and farming.
- Several witnesses observed that the supply management farms are not price takers, and care should be taken in extending the exemption to them. The same questions about greenhouses that already get an 80% levy discount.
- Officials and Senators would still like farms to see price signals for GHG reductions.
- The graph below shows the size and scope of the issue based on 2022 farm expenses.
- Officials further need to clarify to Senators when a province has a GHG levy pass through. This is when the levy is passed back to families in that province. The Senators needed help with the concept that 90% of the levy collected goes back to the province in a backstop province. But, the farm paying the levy upfront does not get 90% of the levy they paid before.
Click on diagrams to view larger versions.
Here is a closer look at farm fuels with a levy.
Below are two updated figures issued by the Parliament Budget Office. This is the revenue the Government of Canada will not collect if C234 is passed.
Please note the Senate debated the third reading on November 10, 2023.
Our Successes
A Path Forward
This year, Biological Carbon Canada was invited by an organization to review and comment on a strategy for getting to net zero by 2050.
We offered feedback and opinions on several areas of their plan, but most notably, we suggested the path forward is here already and does not need significant technology leaps to reduce emissions.
The path starts with today and agriculture’s deficit at or above (below) 60% of our 2005 emission levels. The plan then applied known reductions from today’s existing technologies and changes in management.
Forages Path Forward
Biological Carbon Canada (BCC) is still excited to help the Canadian forage industry find a path forward for GHG reductions.
Working with the Canadian Forage and Grassland Association, BCC examined what is out there for information and offered the CFGA a series of recommendations. They can be found on the CFGA website.
Below is the path BCC believes will assist forage growers in finding the data they need. One is for native stands, and the other is for managed stands.
In all cases, on-farm data is critical for on-farm management decisions.
Agricultural Sustainability
Biological Carbon Canada (BCC) submitted to Agriculture and Agri-Food Canada on their Sustainability Plan.
BCC submitted several comments and opinions. These were:
- The Canadian farm must first be economically stable and healthy.
- The documents shared need more policy signals on accountability issues.
- The plan needs help addressing the $3.2 billion in losses from soil leaving the farm from degradation and erosion.
- We offered policy sweeteners and policy salt to support agriculture’s transition.
- The carbon market needs a regulator, and Canada will play catchup now that the USDA is America’s carbon regulator. We pointed out markets need a regulator to scale and transaction certainty. See the map below to where the regulator needs to be.
Sustainability Follow-up
Biological Carbon Canada (BCC) participated in Agriculture Agri-Food Canada’s Sustainable Agricultural Strategy Soil Health Initiative after our AAFC submission.
What did BCC do? We believe we successfully moved AAFC to a definition of soil health based on things like:
- Unhealthy soils soil wash away
- Unhealthy soils blow away.
We also successfully moved the Committee away from indirect measures like farm practices in current favor today.
The group recommended several core indicators to the Ministry:
- Soil Organic Matter Levels
- Carbon Sequestration Rates
- Soil Salinization acres
- Acres Converted to Urban Use.
BCC was able to place a net carbon sink level into the framework. The Committee accepted that agricultural soil sinks across Canada must not fall below 22,799 million tonnes of carbon.
Other News
Environment & Climate Change Canada Protocol Working Group
As you know, ECCC is developing protocols, and BCC is actively shaping the soil protocol. We’ve contributed insights from our experiences in Alberta’s protocol-making process, highlighting our challenges.
While this process is currently under embargo, we can confirm that ECCC is diligently working on it.
NERP
Alberta approved NERP – the Nitrous Oxide Emission Reduction Protocol
Back in February 2023, Farmers Edge publication announced they completed a NERP project in the voluntary market, with a serialization of 8,910 tonnes. After review, the province of Alberta approved this protocol.
Agriculture & Agri-Food Canada’s (AAFC) Fertilizer Strategy
Biological Carbon Canada (BCC) submitted several recommendations on AAFC’s request for comment on their fertilizer strategy.
Here are the highlights of the recommended actions to the Minister of Agriculture:
- AAFC and ECCC must create one standard for a tonne of carbon achieved through a reduction, avoidance, or sequestration technology in Canada.
- AAFC should engage the Office of the Superintendent of Bankruptcy Canada to examine the ability of the farm supplier to protect ownership of an offset or other instrument in a bankruptcy or creditor arrangement. For example, paying a farmer for the carbon offset should be prioritized over any other creditor.
- AAFC should engage the Office of the Superintendent of Insurance to examine the ability of the market to provide products underwriting the risks in creating GHG offsets or other instruments.
- AAFC should examine the language in the Canada Grains Act for a new Act and its application to regulating trade in Canada for carbon.
GHG Calculator Makes an Impact!
Last year, we developed a comprehensive GHG footprint calculator to help farm managers establish baselines. Our efforts garnered a positive review from Alberta’s Environmental Farm Plan. Notably, an Alberta-based pea plant found our calculator so valuable that they adopted it as a model, purchasing GHG data from their pea growers.
Check out the example to see why the plant was eager to get its hands on the calculator data.
