Conservation Markets for Farms: Economically Sound Environmental Protection

The U.S. population is projected to double over the next 50 years. Much of that increase will be concentrated in a few dynamic regions of the country that will also have to contend with the environmental consequences of growth: air and water pollution, flooding, depletion of surface and ground water, loss or damage to wetlands, and damage to habitat and migration corridors for fish and wildlife. And as those regions grow, they will increasingly need to find the most effective ways to compensate for those environmental impacts.

Damage to the environment can be costly to mitigate—costs that present themselves in the form of higher taxes, increased utility charges, delayed development, and higher prices for products and services inflated by regulation. There are limits to public willingness to absorb such costs, yet ignoring them may ultimately be even more expensive.

So finding the least costly ways to make up for the damage done by growth is essential if we are to protect our prosperity, and also if we are to convince the public to address environmental problems in the first place. So where can we find opportunities to make up for the damage done by growth? Urban areas? Too expensive. Public lands? Already managed for their natural values. It turns out that privately owned farm and forest lands are where environmental gains can be accomplished at moderate cost with the least obvious impact on economic activity.

AP Photo/John Froschauer

The environmental consequences of urban/suburban development can, in most cases, be offset on farmland without taking the land out of agriculture. Of course, the cost for farmers to produce these offsets on their own is usually much too high for a struggling farm business to carry given the narrow profits to be made in agriculture. But because they are already earning agricultural income and generally are producing these values in any case, farmers can typically continue to farm while enhancing these environmental values for much less than it would cost to ignore, prevent, or offset them elsewhere.

There are many excellent examples to illustrate how farms and farmland can readily supply these kinds of offsets through conservation markets: carbon offsets, water quality trading, wetland mitigation, habitat mitigation and flood mitigation.

“With some of the money spent on landscape projects by state highways, you could buy development rights on farmland. Instead of having another frog pond along the freeway, you could have protected farmland, protected water and protected Trumpeter swan habitat. That seems like a fair trade to me.”

Read Jay’s story.

These possibilities have led American Farmland Trust to begin engaging farmers and ranchers in designing conservation markets for ecosystem services produced on active agricultural lands. We believe this approach makes terrific sense for the environment, for agriculture, and for society.

Read my entire whitepaper: How Conservation Markets Can Transform Agriculture and Protect the Environment

About the author:  Don Stuart is the Pacific Northwest Director for American Farmland Trust.