[Terrapreta] -----and Net Present Value of TP Benefits

[Richard Haard]

On Mar 15, 2008, at 10:45 PM, Sean K. Barry wrote:

> Hi Kevin,
>
> "invest or not to invest.... that is the question."
>
> Neither Hamlet, nor Shakespeare was much of a businessman.  Invest  
> in charcoal-in-soil IS the answer.  It's like 42.  It can answer all  
> of your questions.  Not investing into charcoal-in-soil has some  
> predictable outcomes and realized opportunity costs.  Accountants  
> and fiduciaries, bean counters, whoever, I think the decision to  
> adopt TP is not to be made only on present day or present value  
> economics (or maybe it is for just some?).
>
> The science behind the climate trends and its causation by human  
> activity is very compelling.  Compelling enough that this kind of  
> human activity should be changed radically and/or stopped real  
> soon.  I don't think economics now prove this.  I do think economics  
> will prove it out in the end, though.  The consequences of inaction  
> on this front will have radical effects on world economics in the  
> long run.  The best businessmen, the ones around the longest, saw/ 
> see into the future the furthest.
>
> Your well managed lands would not likely benefit as much from TP as  
> would my "never farmed" or "ignored for 60 year" lands.
> Do you think that is possible?  Fallow land might be in better  
> fertile shape than heavily farmed land, even if well-managed.  That  
> land certainly will not be polluted with too much industrial  
> chemicals, nor will it lack SOM like heavily fertilized, heavily  
> cropped, and degraded land.

Kevin is correct here. Keep in mind the differences in climate and  
soil types. In northern Michigan (my experience) the soils are acid  
leached with white silica sand on surface and are classified as  
podzolic.

Podzols (PZ) Acid soils with a subsurface accumulation of Spodosols
iron-aluminium-organic compounds

and the moist tropics

Ferralsols (FR) Deep, strongly weathered soils with a chemically poor,  
Oxisols
but physically stable subsoil

In some places here in PNW on glacial till, with soils of granitic  
origin the farmers never need to fertilize. Fallow ground here on our  
sandy loam OM levels are around 6%


>
> Just and observation and I hope you do not mind my saying this.   
> But, doing a "Net Present Valuation" on Terra Preta formation is  
> really kind of shallow and short sighted in my opinion.  The greater  
> potential benefits from TP are mostly in the out years and lack real  
> measurability.
> The benefits include many things, beyond and still including all of  
> the potential agricultural benefits.  What do you think the NPV of  
> the Terra Preta formations was that the ancient Amazonian peoples  
> built?  Aren't these TP sites in Amazonia still accruing benefits  
> thousands of years later?

Not so, Sean We will need a equivanlent of NPV or cost/benefit for  
each soil/climate provenience.
> Could they have foreseen in their NPV stuides that Terra Preta would  
> someday save the world from thermal runaway in the atmosphere and  
> the oceans?
>
> I think appreciating the value of building large Terra Preta  
> formations now requires a deep look into our future.
>
> Regards,
>
> SKB
>
> ----- Original Message -----
> From: Kevin Chisholm
> To: Richard Haard
> Cc: Peter Read ; Sean K. Barry ; Miles Tom ; Toch Susan ; Michael  
> Pilarski ; Baur Hans ; Todd Jones
> Sent: Sunday, March 16, 2008 12:09 AM
> Subject: Re: -----and Net Present Value of TP Benefits
>
> Dear Richard
>
> Richard Haard wrote:
> >
> > On Mar 14, 2008, at 8:47 PM, Kevin Chisholm wrote:
> >
> >> Peter Read wrote:
> >
> >
> > Hello Kevin  - drifting a bit from the thread but an interesting  
> topic
> > to me.
> >
> > by NPV you mean direct value to farmer such as added CEC  or OM
> > equivalent? The real value to farmer - not discounted carbon  
> credit is
> > what will make this all happen as general practice in agriculture.
>
> The "Net Present Value" is simply a way of converting the benefits  
> of TP
> to a common denominator, that being $. Doesn't matter if it is CEC,  
> OM,
> nutrient retention, drought resistance, a concern for global warming,
> higher yields, better quality, carbon credits... all of these are
> benefits having tangible and intangible value. To get these benefits,
> one must "invest" in charcoal, and its application. Charcoal, as one
> aspect of Terra Preta, is costly, but the investment has a long life.
> Annual returns per acre will be small, but they also will continue to
> flow for a long time also. The "Net Present Value" is a simple way to
> compare the value of Investment over a period of time, with Returns  
> over
> a period of time, so that one can make a rational decision  "invest or
> not to invest.... that is the question."
> > What is the real economic benefit to the farmer per ton applied to
> > land will depend on  soil type, climate and needs for fertilizer
> > supplements to maintain fertility levels and as yet unquantified
> > benefits of charcoal additive in soil. This figure of NPV $50  could
> > be quite higher.
>
> Yes indeed, it could be quite high in some cases, but there are  
> probably
> other cases where it would be an understatement. TP cannot make a
> difference if one already has a "perfect soil". The greatest value for
> TP will be in "disadvantaged soil situations." Your well managed lands
> would not likely benefit as much from TP as would my "never farmed" or
> "ignored for 60 year" lands.
> >
> > Most important in soils where organic matter needs to be monitored
> > carefully to maintain productive capacity (not all do), what needs  
> to
> > be calculated is the cost of raising soil organic matter an  
> equivalent
> > amount permanently.  Ie the cost in lost production of fallow  
> periods
> > and the cost of reestablishing farming if the land has gone back to
> > forest during fallow.
>
> Right on. If one did a NPV analysis on TP, and on the alternatives,  
> tehn
> one can make a rational decision on which is teh best and most  
> sensible
> way to go.
> >
> > I am hoping the block research currently underway at our farm
> > comparing compost to charcoal to fertilizer and permutations will
> > answer this question for us at 4CN.
>
> I am impressed with the methodical way that you are proceeding to get
> the facts of the matter as they apply to your lands. Given that you
> appear to be keeping your lands in pretty good condition, I would  
> expect
> that your results will be less favourable to TP than would be mine,
> where I am starting with disadvantaged land.
> >
> > In our farming we are holding organic matter at 4 % minimum with
> > biannual applications of 1 cubic yard of compost made from sewage
> > solids and sawmill wood waste per 1000 sq. feet. In addition, we are
> > adding summer and winter cover cropping when a particular section is
> > fallow. So far as a OM supplement sawdust alone will do the job when
> > balanced with garden fertilizer to compensate for binding of N and P
> > by the decomposing wood. But this OM benefit in tilled soil is  
> gone in
> > a few years whereas the charcoal lasts as I am trying to quantify at
> > our soil.
>
> Last summer, I put 4" of seaweed on a test plot with remarkable soil
> benefits. This year, I hope to do some tests with charcoal  
> additions. If
> your land would not benefit as dramatically from such seaweed  
> additions,
> then there may not be "growth bottlenecks" for charcoal additions to
> eliminate.
> >
> > Buying charcoal at $ 200/ton will not happen for us in the short  
> term
> > anyway because of these economic factors. I do not know what a cubic
> > yard of dry sawdust weighs but cost is  most likely 5 % or less  
> and we
> > use about 250 yards or more  annually. What might happen though in  
> the
> > near term is our on farm waste wood summer dried and converted to
> > charcoal by some sort of smothered combustion. In our climate dry
> > weather July through September will allow us to do this by  
> windrowing
> > with farm machinery.
>
> A NPV analysis would tell you most you could afford to pay for the
> charcoal benefit. This would then tell you the maximum you could spend
> for producing and placing the charcoal.
> >
> > We will have significant quantities available, probably each year  
> 300
> > cubic yards of loose twigs, roots and reject plant trimmings. Right
> > now we either burn this stuff or use the soil/weed and reject plants
> > as fill. Labor and use of equipment on farm does not equate to
> > purchases outside of normal operations hence costs we incur on  
> such a
> > project are more easily absorbed as I suppose they are elsewhere.  
> I am
> > thinking some sort of buried pyrolysis with movable scrap sheet  
> metal
> > and wet spoiled hay in a top lit bottom draft system similar to our
> > project 2 years ago.
>
> Sure! That is the way to go. What you are doing is effectively  
> producing
> charcoal in a manner where only teh incremental costs of production  
> have
> to be charged against charcoal production.
> >
> > If the value of farm waste worked into soil, say corn or wheat  is
> > higher when converted to charcoal then the most efficient method for
> > doing this onsite will rule in the end.
>
> Yes. That is the way it should be.
>
> Best wishes,
>
> Kevin
> >
> >
> > On Mar 14, 2008, at 8:47 PM, Kevin Chisholm wrote:
> >>  If we assume that Charcoal in TP gives a return with aNet Present
> >> Value  equivalent to $50 per tonne of Charcoal applied,
> >
> >
>
>
>
>

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