EXCLUSIVE: Microsoft, Rabobank announce first round of carbon credits with agroforestry startup reNature

Rabobank’s carbon marketplace, Acorn, and Dutch-Brazilian startup reNature have generated their first round of carbon credits in partnership with a Brazilian farmer co-op Cooperative Agricola Mista de Tomé-Açu (CAMTA). 

The effort generated 242 carbon removal units (CRUs), which amounted to 25,000 reals ($4,647) in payments for CAMTA’s farmers, providing each producer with roughly 100 reals ($18.59).

Microsoft purchased the credits as part of its commitment to becoming carbon negative by 2030.

Acorn is aimed at providing smallholder farmers access to the emerging carbon credit market. It also hopes to help address climate change in rural communities, as well as food insecurity and land degradation. Its goal is to work with 15 million farmers to cover an area three times the size of the Netherlands with agroforestry systems by 2025. This will sequester the equivalent of 150 million metric tons of carbon emissions annually, it  claims.

The Acorn program is open to farmers with less than five hectares who have been engaged in agroforestry or regenerative farming for five years or less, and who have not yet monetized any carbon credits. The land must have been free of deforestation for the last five years, too.

Co-founded by Felipe Villela and Marco de Boer, reNature aims to help farmers transition to regenerative practices. It provides technical assistance, impact monitoring, financial resources, and access to international premium markets. Its overarching goal is to reach 100 million regenerated hectares by 2030 while supporting more than 10 million producers in making the transition.

The startup closed €550,000 ($677,000) in seed funding from private investors at the start of this year.

CAMTA comprises 132 farmers, with over 10 years of experience in cultivating agroforestry systems in palm oil, acai, cocoa, pepper, brazilnut, and other fruits, according to Villela.

He describes CAMTA’s farmers as being “immediately interested” in participating in the project.

“They would never expect to receive money because of the trees they planted five years ago to shade the cocoa,” he tells AFN.

Choosing a carbon accounting methodology

As carbon markets gain more momentum in agriculture, questions are being asked about the right method to measure the stuff. The crux of the debate comes down to things like whether soil samples are always necessary, the appropriate depth for sampling, how frequently samples should be redrawn, or whether statistical modeling is enough to quantify sequestered carbon.

Acorn is developing CRUs based on a measure of carbon stored in planted trees and biomass in the vegetation cover. Acorn’s CRUs are only sold after the trees have converted their carbon into biomass. It says it measures this using remote sensing technology, including satellite imagery. 

Acorn works in partnership with Plan Vivo to get its CRUs certified.

Villela claims this sets Acorn CRUs apart from other carbon credits because they “represent real carbon that is no longer in the atmosphere.” 

“We’ve done a ground-truthing measurement calculating the biomass potential and validated the data with three different satellite imagery tech partners from Rabobank,” he says.

“Acorn’s methodology isn’t anything new, it’s an old method to measure carbon above ground. [But] it’s unique for its price-quality and its focus on smallholder agroforestry farmers.” 

Despite the debate around appropriate accounting practices, carbon markets are gaining more and more attention. Players like Cargill, Farmers Edge, FBN, Indigo Ag, Land O’Lakes, Nori, and Regrow Ag are all getting involved in the game.

Meanwhile, a recent McKinsey report indicates that demand for carbon credits could increase 15x or more by 2030, and by 100x by 2050. 

Villela has some concerns about the sector as it continues to expand at a meteoric rate.

“We’ve seen many carbon credits initiatives that are still relying on conventional agriculture,  intensively tilling the soil, not using any cover crops, not diversifying the system, and only seeing [the market] from a premium perspective,” he says.

“They are not very interested in having a more holistic approach, impacting biodiversity positively, or increasing soil health, water quality, and farmer socio-economic resilience.”