Credits Where Credits Are Due? The Hidden Costs for Regenerative Farmers in the Carbon Market
In a world increasingly obsessed with carbon footprints, carbon credits have emerged as a sort of currency for climate virtue. Corporations buy them to offset emissions, governments promote them as part of their net-zero targets, and entire platforms exist to measure, package and sell them. The idea is elegant in theory. A polluter pays, and somewhere else, a tree is planted or a field is restored, absorbing enough carbon to balance the books. But when it comes to agriculture, especially the kind that’s trying to do the right thing for the land, the system is far less tidy.
Regenerative agriculture has had a remarkable few years. Once viewed as the domain of idealists with compost bins, it’s now backed by major food brands, endorsed in climate policy circles, and increasingly practised on farms from Australia to East Anglia. At its core, regenerative farming prioritises soil health, biodiversity and resilience over yield at any cost. It often means cover cropping, rotating livestock, reducing chemical inputs and avoiding deep tilling. In other words, it sequesters carbon. But here's the paradox: many of the farmers doing this essential climate work are struggling to access the very carbon credit markets that were designed to reward it.
It isn’t just a question of fairness. It’s a question of who gets recognised, who gets paid, and who gets pushed out of systems that claim to value sustainability.
To issue carbon credits, a farm typically needs to prove two things. First, that their practices are “additional” — meaning the carbon wouldn’t have been stored anyway. Second, that the results are “verifiable” — backed by data, measurements, modelling and third-party audits. That sounds reasonable on paper, but in practice it creates a system that’s heavily skewed towards those with capital, consultants and advanced digital tools. Large agribusinesses with monoculture plantations, high-resolution satellite imagery and dedicated ESG teams are well placed to tick all the boxes. The family-run mixed farm using cover crops and rotational grazing might be sequestering just as much carbon, but without the resources to prove it, they’re locked out.
According to a 2023 report by the World Resources Institute, only a small fraction of nature-based carbon credits currently come from smallholder or regenerative farms. The barriers are both technical and financial. Setting up a carbon measurement baseline, hiring a verifier, and maintaining reporting systems can cost thousands of pounds. For many independent farmers, especially in the UK and Europe, the cost of participating in a voluntary carbon scheme can outweigh the benefits.
It’s no wonder then that some farmers feel the system is rigged against them. They’re told they need to do more to combat climate change, but when they do, they’re either ignored or underpaid. Worse, many carbon offset schemes are structured in a way that favours industrial-scale monocultures over the complex, messy beauty of regenerative systems. Plant a thousand hectares of fast-growing eucalyptus trees and you may qualify for credits. Rewild a hedgerow, restore a pasture, or bring back pollinators, and you may be applauded — but not compensated.
The result is a market that often rewards the optics of carbon capture over the reality of ecological health.
It’s not all bad news. Some new platforms are trying to change this. Projects like Regen Network and Soil Heroes are attempting to create farmer-first carbon marketplaces. They aim to simplify verification, reduce entry costs, and build relationships based on trust and transparency rather than bureaucracy. In the UK, the Sustainable Soils Alliance and the Woodland Trust have both advocated for reforms to carbon markets that take small farms and soil-based sequestration seriously. And globally, the Integrity Council for the Voluntary Carbon Market has been tasked with improving standards and preventing greenwashing.
But progress is slow, and the economic pressures are very real. With rising input costs, unpredictable weather and market volatility, farmers are often forced to make tough decisions. If regenerative practices aren’t supported financially, they risk being abandoned in favour of short-term yield gains. That undermines not just climate goals, but also long-term food security, ecosystem resilience and rural livelihoods.
There’s also a deeper question here about how we value land, labour and life. Carbon credits are fundamentally transactional. They reduce complex ecological relationships to a single metric: tonnes of CO₂ equivalent. That might be useful for accounting, but it doesn’t capture everything that matters. Healthy soils don’t just trap carbon. They retain water, support biodiversity, reduce erosion and improve crop quality. Hedgerows don’t just store emissions. They shelter birds, prevent wind damage, and offer corridors for wildlife. None of these benefits are easily measured in carbon terms, and yet they’re central to what makes farming regenerative in the first place.
It’s not that measurement is bad. It’s that we need to measure what matters, not just what’s convenient.
Some scholars and campaigners argue that we’re approaching this the wrong way entirely. Rather than relying on voluntary carbon markets to trickle money down to good farmers, they say we should be integrating soil health and climate resilience directly into agricultural policy. That means subsidies, public funding, and long-term contracts that support land stewardship. It means paying farmers not just to offset someone else’s emissions, but to protect the commons — the water, the air, the biodiversity we all depend on.
There’s precedent for this. The UK’s Environmental Land Management scheme, though still evolving, is built on the idea of public money for public goods. If properly funded and implemented, it could provide a more equitable and reliable source of support for farmers doing regenerative work. Similarly, the EU’s Common Agricultural Policy is undergoing reforms that include eco-schemes and sustainability benchmarks. But translating ideals into action takes political will, and that often lags behind.
In the meantime, carbon credit schemes continue to grow. Major retailers, airlines and tech companies are buying up offsets to meet net-zero pledges. Venture capital is pouring into climate finance platforms. And farmers are left to decide whether to participate in systems that may not serve them.
Some will choose to opt out entirely, focusing instead on direct sales, community-supported agriculture, and farm-to-fork models that reward trust and quality over metrics. Others will do their best to navigate the carbon markets, hoping to be recognised and paid fairly for the work they’re already doing.
Either way, the current system needs fixing. Because if the farmers who are restoring soil, planting trees, and caring for the land can’t access the benefits of climate finance, then we’ve got the wrong incentives in place.
Carbon markets aren’t inherently bad. But they must be designed with care, humility and justice in mind. That means listening to farmers, especially those on the ground, and building systems that serve people and the planet — not just spreadsheets.
In a warming world, the question is no longer whether we can afford to support regenerative farming. It’s whether we can afford not to.