With financial help from Jharkhand government’s Birsa Harit Gram Yojana, a scheme launched in 2018, farmers in Birsa village planted trees, mostly mango, over 1,00,000 acres. When they did it, they had no idea that they could be earning by generating and selling carbon credits; now they do.
Over 13,000 farmers have joined a Carbon Credit Finance Project on Rabobank’s ACORN platform, with more expected to join. These farmers are expected to take care of the trees to ensure their growth, for which they will get money. Trees grow by absorbing carbon dioxide from the atmosphere —it is the carbon in CO2 that becomes the wood. The carbon sequestered annually earns them Carbon Removal Units (CRUs), which are carbon credits issued by ACORN. These credits are issued for actual carbon removed from the atmosphere, rather than avoided emissions or presumed removals. One CRU denotes one ton of sequestered carbon.
Intellecap Advisory Services, a climate and carbon consultancy of the Avishkaar group, worked with ACORN to onboard the farmers and establish a satellite-based carbon sequestration assessment system.
The Birsa Harit Gram project serves as a potential model for agro-forestry, which is gaining ground because the buyers of carbon credits prefer — pay a premium — for credits based on Nature Based Solution, as opposed to offsetting projects like renewable energy or projects like carbon capture.
In the Jharkhand project, the ultimate buyers of the CRUs have put three conditions — the farmers must be ‘small’ in terms of land holdings, at least 80 per cent of the proceeds of CRU sales must go to the farmers (meaning all the expenses should be contained within the other 20 per cent), and carbon sequestration should be measured rather than calculated with a formula to ensure the integrity of the carbon credits. Santosh Singh, Managing Director, Intellecap, told businessline that roughly CRUs generated by Birsa farmers could earn even $20 a CRU.
The first-time verification of carbon sequestered would be done physically, by inspectors — this is expected to happen in a couple of months. Subsequent measurements could be satellite-based, Singh said. The first disbursement of CRU money to farmers could happen in a year.
Roughly, the project is expected to earn ₹500-600 crore over the next 20 years.