As offsetting and carbon credits grab headlines, a different movement is flying under the radar — insetting. Instead of funding carbon removal projects in varied locations and collecting carbon credits to balance their carbon accounting sheet, some companies are focusing internally on their supply chains. This is especially true of the big food corporations whose farming and ranching partners account for most of their emissions.
And Organic Valley is paying a carbon market price directly to its suppliers. The farmer-owned organic cooperative of dairies found that insetting was much more in line with its ethos than offsetting. In fact, it has no budget for offsets.
"It feels more authentic to who we are as a cooperative of farmers," said Nicole Rakobitsch, director of sustainability at Organic Valley. "Our farmers are also the owners of the business. We’re investing inside our own supply chain, on the farms where the commodities that go into our products get produced."
In 2022, Organic Valley ran a pilot version of the insetting effort it is opening up to all farmers in its supply chain in 34 U.S. states this month as the CROPP Carbon Insetting Program (CCIP). The initiative helps farmers implement solar, manure composting, agroforestry and other regenerative and climate-smart farming practices. Organic Valley pays the farmers $20 per-metric-ton for the carbon they sequester or reduce, a number Organic Valley decided was competitive with the external carbon offset market. Farmers in the pilot program have been receiving payments from Organic Valley while it’s the first time receiving carbon payments for those who join this year.
"One of the motivations for creating a carbon insetting program is just the sheer fact that we know there are these external markets out there that are courting Organic Valley farmers," Rakobitsch said. "We really wanted to be the market of choice for them."
By contrast, farmers could join carbon offset marketplaces, such as Nori, and sell credits to other corporations. But Organic Valley wants the carbon reductions on its farms to be applied at home, not to other companies. For Chris Wilson, a seventh-generation dairy rancher and feed producer in Wisconsin, the carbon payment wasn’t the main driver for joining CROPP. The carbon payments from Organic Valley only covered about 5 percent of the costs for installing 60 kW of
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