IDEAS home Printed from
   My bibliography  Save this paper

Using Carbon Offsets to Fund Agricultural Conservation Practices in a Working-Lands Setting


  • Reeling, Carson J.
  • Gramig, Benjamin M.


The nitrogen cascade concept indicates that agriculture serves as a significant link between emissions of the potent greenhouse gas (GHG) nitrous oxide and losses of nitrate-N to surface waters. Conservation practices have the potential to exploit this link, as their implementation is found to reduce fluxes of GHGs and nonpoint source (NPS) water pollution. Several studies have recognized this link and have documented the potential to improve environmental quality through the use of programs which retire land, the cost of which can be offset by the sale of carbon credits. However, the ability to use land for both agricultural production and environmental conservation is important. As such, this study provides a novel analytical framework that is used to examine the potential for implementing agricultural conservation practices to reduce NPS water pollutants and fluxes of GHGs in a working-lands setting. The extent to which carbon pricing can affect practice implementation costs and the optimal distribution of these practices throughout the watershed is also explored. Results from this study indicate that carbon offsets can sharply reduce conservation practice implementation costs and therefore have the potential to reduce greater amounts of NPS pollution for a given cost of implementation. This conclusion has significant implications for policymaking, particularly with regard to using market mechanisms to improve water quality in watersheds where markets have historically been unsuccessful. However, this study found that the optimal allocation of practices was heavily reliant on fertilizer management, which is difficult to enforce in practice.

Suggested Citation

  • Reeling, Carson J. & Gramig, Benjamin M., 2011. "Using Carbon Offsets to Fund Agricultural Conservation Practices in a Working-Lands Setting," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103577, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea11:103577

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Bontems, Philippe & Thomas, Alban, 2006. "AJAE Appendix: Regulating Nitrogen Pollution with Risk-Averse Farmers under Hidden Information and Moral Hazard," American Journal of Agricultural Economics Appendices, Agricultural and Applied Economics Association, vol. 88(1), February.
    2. Manoj Jha & Sergey Rabotyagov & Philip W. Gassman, 2009. "Optimal Placement of Conservation Practices Using Genetic Algorithm with SWAT," Center for Agricultural and Rural Development (CARD) Publications 09-wp496, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    Full references (including those not matched with items on IDEAS)

    More about this item


    greenhouse gases; nonpoint source pollution; agricultural conservation practices; DAYCENT; SWAT; genetic algorithm; Environmental Economics and Policy;

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea11:103577. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.