MJBizMag August 2021 - 54

Business Under Fire
said Kimberly Kovacs, chief strategy
officer of New Mexico hemp producer
Santa Fe Farms. " We have a responsibility
to look at ... how we can regenerate our
land, and hemp is that solution. "
A federally funded carbon bank-or
support for farmers joining voluntary
markets-could change the hemp
industry in three ways:
* Carbon payments could become
an additional revenue stream for
existing hemp farmers.
* Carbon payments could encourage
farmers to add hemp to their
crop rotations, increasing hemp
production in the United States.
* Hemp farmers could be encouraged
to grow varieties better suited for
industrial purposes that sequester
carbon over many years, rather
than flower varieties that currently
command higher wholesale prices
but don't have the same long-lasting
climate potential.
Some hope the carbon-bank idea
could bring hemp more into the forefront
as a sustainable crop.
" It's a shame that hemp-as a
regenerative crop that uses less water,
has better CO2
sequestration rates than
trees and has more market value than
a typical cover crop-is still kind of an
underdog, " said Angela Dawson, founder
of the 40 Acre Co-op, a network of Black
and socially disadvantaged hemp farmers
based in Sandstone, Minnesota.
Complicated Carbon Markets
In addition to producing commodity
crops, landowners also can be paid for
carbon sequestration and natural resource
conservation. But it's not a simple
process, said Van Voorhis, whose Green
Trees project represents 600 landowners
totaling 130,000 acres.
" Not one of those landowners could
go into the carbon market themselves
and bear that (verification) cost, " Van
Voorhis said.
Working with a project administrator
helps offset the cost of working with carbon
registries. The three main voluntary carbon
54 MJBizMagazine | August 2021
The Green Trees reforestation project currently
includes 600 landowners with 130,000 acres
and sells carbon offsets to buyers such as Duke
Energy, Shell, Microsoft and Bank of America.
Courtesy Photo
registries are the American Carbon Registry,
Climate Action Reserve and Verra.
An administrator also helps landowners
manage their resources, layering in
value points so they can be paid for their
crops, plus the carbon being stored in
their soil. They can identify tax credits,
conservation programs and water payments
for using regenerative practices to
improve water retention on the property.
" The key is to optimize multiple points
of income, not maximize one and sacrifice
another, " Van Voorhis said.
Producers can find and compare
voluntary carbon-offset projects and
programs by searching the registries and
referencing the Carbon Offset Research
and Education program.
By aggregating land through partnerships
with landowners, project administrators
catch the attention of big buyers
such as Duke Energy, Shell, Microsoft
and Bank of America.
" Markets happen through
partnerships, " Van Voorhis said. " Buyers
are looking for millions of metric tons, so
a landowner with 100 acres generating
200 tons of carbon per year-that's (going
to be) hard to get buyers' attention.
Offsetting Emissions
On the other side of the spectrum,
cannabis firms are becoming carbon-offset
buyers themselves in their quest for
carbon neutrality.
Hexo Corp., a publicly traded
company in Ottawa, Ontario,
announced an ambitious goal in early
June to offset its operational carbon
emissions and the personal emissions
of roughly 1,200 employees to become
carbon neutral by September.
CEO and co-founder Sebastian
St-Louis said now that his company
is on a path toward profitability, it is
committing to environmental leadership
and challenging other cannabis
companies to follow suit.
The company's actions are " just the
start " of its challenge to do better, said
St-Louis, who declined to reveal the
amount Hexo is spending on the carbonneutrality
effort, though he estimated
that offsetting employee carbon would
cost the company just under $802,065
(CA$1 million) per year.
Hexo is working with Offsetters,
a Vancouver, British Columbia,
sustainability and carbon-management
provider, to support the Great Bear
Forest Project, a 25-year improved forestmanagement
project designed to protect
forests previously designated, sanctioned
or approved for commercial logging.
" The tree grows, absorbs carbon from
the air ... then that carbon actually goes
into the root system. So 25% of the carbon
of the tree stays in the Earth, and that's the
actual carbon going into the ground. "
Hexo validated its emissions with the
province of British Columbia.
Hexo also is working to reduce
emissions by minimizing waste across
the supply chain, including reducing
plastic in its packaging and exploring
sustainable alternatives, implementing
green energy solutions and converting to
a virtual workplace where possible.
" We'll always be able to get better, "
St-Louis said. " The best way to offset
carbon ... you want to not generate it in
the first place. "
Kristen Nichols contributed to this story.
Laura Drotleff covers hemp
for Hemp Industry Daily and
MJBizMagazine and can be
reached at laura.drotleff@
hempindustrydaily.com.
MJBizMag August 2021

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