In Washington, Iowa, a farm community about an hour south of Cedar Rapids, a seventh generation farmer named Mitchell Hora has been working hard to make sure he and as many of his fellow farmers as possible benefit from a program he believes will have a “ historic” impact on his community.
In 2015, while continuing to work on his farm, Hora founded a side business called ContinuumAg, to help other Iowa farmers quantify and verify their carbon footprint, a key component of qualifying for the tax credit.
Today, he sees the tax credit, a provision of President Joe Biden’s Inflation Reduction Act, as a game changer for farming communities, a vehicle not only to bring new corporate players to the table in a region they often ignore, but also for spreading the gospel of “regenerative” or “sustainable” agriculture.
“Regenerative agriculture is the future and simply a better system for farmers,” Hora said during the interview that follows.
“45Z, the renewable fuels tax credit is inspiring people to think about soil health and low-carbon farming practices like never before,” he said.
As a result, ContinuumAg has grown from a simple consultancy to the operator of a prominent soil health data intelligence platform called TopSoil.
A graduate of Iowa State University with degrees in Agronomy and Ag Systems Technology, Hora has been lauded in recent years by everyone from Iowa’s governor, who gave him a prestigious environmental excellence award in 2023, to Forbes magazine, which celebrated him with a spot on its 30 under 30 list in 2021.
Mitchell is a Soil Health Champion as designated by the National Association of Conservation Districts, is a member of the Global Farmer Network and serves on the Washington County, Iowa Farm Bureau Board.
Hora’s wife, Tympest, shares his entrepreneurial spirit, and is owner of a dance academy in Fairfield, Iowa. They have two children.
REM : So let’s start with the most basic of questions. How did you get into the business of carbon intensity analysis?
MH : Everything that I have built at ContinuumAg, I’ve built from my own family farm. That’s really how I got into it. I’m a seventh generation farmer. The year 2025 will be my family’s 152nd crop in Iowa, and my family has been big into conservation practices, such as no-till and cover crops, for decades.
I started ContinuumAg back in 2015 to bring soil health analysis and better technology to row-crop farms like mine, and then in 2020, we launched a software to help farmers quantify and map their soil health.
It was around this same time that I started getting involved in some of the carbon credit programs that were around at that point; the problem was, none of those carbon credit programs were really set up for early adopters like my farm and like a lot of the other farmers that I was consulting with at that point.
So, from a business standpoint, we were helping other companies with their carbon credit programs. I worked with Bravo Bank and CIBO, a voluntary carbon marketplace that allows companies to offset their carbon emissions by purchasing carbon credits generated by US farmers, and a variety of others in the carbon credit space – mostly dealing with carbon offsets in the voluntary carbon markets .
However, when the Inflation Reduction Act got passed in August 2022, I dug into the 45Z section and the GREET model and just had the light bulb moment when I realized this is what I’ve been looking for, for my own farm,
REM : Okay, so just for the benefit of our readers. When we’re talking about 45z, we’re talking about a new tax credit created by the Biden administration as part of the Inflation Reduction Act that is supposed to replace a handful of existing fuel industry tax credits that are set to expire at the end of 2024.
MH : Correct. The 45Z tax credit, which goes into effect on Jan. 1, 2025, will reward renewable fuel producers for lowering the carbon intensity (or CI) score of their fuel.
REM : And since we’re defining terms. The GREET model you referred to is short for the Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation model, which is a tool used to examine the life-cycle impacts of vehicle technologies, fuels, products, and energy systems.
MH : Exactly. And so basically, I realized that this was exactly what all of these companies had been looking for as they tried to quantify and reduce their carbon footprint.
As a result, about two years ago I flipped my company on its head. I moved away from being consulting-focused to really being software- and data-focused.
Since then, we’ve been aggressively pursuing on-farm carbon intensity quantification and third-party verification of the same.
So today what I tell people is we are MMRV for carbon intensity, which stands for Measuring, Monitoring, Reporting and Verification. So far, we’ve scored 350 million bushels of crops.
What we do is, we go directly to the farmer, and while we very aggressively try to get them ready for 45Z, I’m also very bullish about the entire concept of farmers being part of the solution as more and more companies look to decarbonize .
REM : Okay, so for a little context, you mentioned a moment ago that you grow row crops on the family’s farm… obviously, one of those crops must be corn, but…
MH : Corn and soybeans. And we grow quite a bit of cereal rye as well. The cereal rye we grow for use as cover crop seed.
The main cover crop that’s used throughout the Midwest is cereal rye, and the seed is fairly expensive, so we’ve been growing our own for the last six years and utilizing our own seed and then selling cereal rye seed to other local farmers.
REM : So, with carbon intensity testing. Why do we… I mean, why do you, as a farmer, or one of your neighbors, need this? And you described this epiphany you had, did other farmers know they were looking for a tool like this?
MH: To answer the last part first, no, farmers are not aware that they need this kind of testing at their disposal, so I’ve been educating them through social media, through events, and things like that. I did 52 in-person speaking events in 2024, plus a lot of virtual stuff.
We also do a weekly podcast and webinars and that kind of thing.
Now work backwards through your question, the 45Z tax credit is why farmers need this data.
The 45Z credit, though, is for transportation biofuel producers, those who make things like ethanol, biodiesel and sustainable aviation fuel.
Now, for ethanol, just to cite an example, the carbon intensity equation for a gallon of ethanol includes the crop, in other words, the feedstock that was used. In the case of a gallon of ethanol, more than half of the carbon intensity of a gallon of ethanol comes from the corn that’s used to make it. Am I explaining this clearly?
REM: Yes, I think so…
MH: Okay, so today, on average, a gallon of ethanol in the US has a carbon intensity score of approximately 53, according to the Renewable Fuels Association.
Now corn, by itself, has a carbon intensity score of 29.1 – that’s the default score established by the US Department of Energy – meaning corn is more than half of the equation, right?
REM: Right …
MH: Now, I know I might be taking down a rabbit hole here, but our role, to put it as simply as I can, is to help farmers replace that default score of 29.1 with their real score, which is often substantially lower.
Essentially it comes down to ethanol producers wanting to decarbonize so that they can earn this monetizable tax credit, namely the 45Z tax credit, and the best way to do that is use low-carbon corn.
We’re the partner in the process that enables you to provide you have low carbon corn, based on the data we collect.
So, as I said earlier, we have scored roughly 350 million bushels of corn, and the average bushel that we’ve scored has had a carbon intensity score of 11.5. Now, that 11.5 is a drastic increase from the default of 29.1.
REM : Why is that?
MH: It’s because the government scores are conservative, which is good, but they are also quite outdated.
Farmers in the meantime have been implementing good conservation systems, precision agriculture systems, utilizing fertilizer better through the use of technology, adopting practices like no-till and cover crops, utilizing the newer, rather than synthetic fertilizers.
And like I said, on average, we’re seeing that the bushels of corn that we’ve measured so far have scores of around 11.5.
So it’s the difference between that and the default of 29.1 that can be leveraged by the ethanol plant that wants to earn 45Z tax credits.
REM: As we speak, it’s the day after Christmas, and we’re still waiting for some government guidance on 45Z, aren’t we? Especially on areas like how long the credit will last and whether it will apply only to US-grown feedstocks?
MH: That’s true. And what we’re doing in the meantime is helping farmers calculate their scores, utilizing a third-party protocol we developed based on the government’s ISO 14O64 standard.
Now, it may be that when the guidance comes down, the government will want to prescribe an audit protocol; that’s fine. We’re open to that and we will adjust our protocol to fit the government requirements.
But what we’re doing now is trying to proactively help farmers manage their data, because data is quite fragmented on a lot of farms, and we have to tell a very holistic story about how the crop was grown.
It takes a lot of data, a lot of work, but that’s what we’re here to do – help farmers manage their data, verify their practices and verify their carbon intensity.
REM : Now, you used the word “audit”; Is your process exclusively based on an audit? Is there any testing involved or anything like that?
MH: What we do is all model based, utilizing the US Department of Energy’s GREET model.
What it says in the Inflation Reduction Act is that a model “shall” be developed by the US Department of Energy and the Argonne National Laboratory.
The model that they already have, and which has been around since 1994 and continues to be improved upon, is the GREET model.
We’ve been helping farmers to score using the latest GREET model, which was released a year ago, and we fully anticipate that there will be a new model for the tax credit.
But you know, I think it’s important, and we at ContinuumAg, think it’s important to be proactive here because it is going to take a lot of data to tell this story.
You might not realize this but a third of the corn that’s grown in this country goes into ethanol production – a third… of all… corn grown here… so it is going to be a monumental lift that’s needed to get the program rolling.
There are some farms that are incredibly technologically advanced, and there are others that are incredibly not technologically savvy at all.
So we’re having to take a very tailored approach to each of the farms we are working with, helping them manage their data and prove that they’re using the sustainable, low carbon practices that they say they’re using.
REM: Based on the situation you’re describing, I imagine you run into a lot of people who are like, “What the heck are you talking about?”
MH: Oh, it’s all brand new. It’s all brand new. And unfortunately, because the rules have been so delayed, there’s a lot of confusion in the marketplace.
There’s also been a lack of aggression from the industry, because the ethanol industry has been burned by policymakers in the past, and so they’re very skeptical. It’s hard to roll out any type of program and really educate farmers when we don’t even know the rules.
We don’t have all the details, but we are anticipating getting some guidance from the Biden administration before the inauguration.
There is guidance that is in review at the White House right now. It’s a guidance that was laid out by the Department of Agriculture and it includes some of the rules that they put together about quantifying carbon intensity of feedstocks to be used in biofuels.
That said, and as exciting as it is that the rules are under review, the ultimate guidance on the tax credit is coming from the Treasury Department.
REM: So Treasury …
MH: Well, we know that the Treasury and the Agriculture Department have been working together, in collaboration, to try to ensure that this tax credit gets done correctly. But there’s a lot at stake. This tax credit is going to set a precedent that can be used outside of the biofuels arena. It’s going to have a ripple effect across the whole of agriculture and really drive the adoption of more sustainable ag practices.
REM: Okay, so this brings me to asking, what’s actionable about this data you are collecting. I mean, on the one hand you’re handing them a document that says, this is your carbon intensity and this is how it may impact your applying for a tax credit. On the other hand I’m kind of wondering about that farmer who looks at your data and says, “Hmm… my carbon intensity is kind of high… what can I do about it?”
MH: You nailed it. You nailed it. What we have done is we’ve simplified the calculation process using the GREET model, and we actually do the baseline scoring for free for farmers on our software, which can be found at topsoil.ag .
Farmers can go to topsoil.ag, set up an account, and within, usually, 10 minutes or so, they can have their carbon intensity score totally for free.
Then we also built a calculator tool where they can run scenarios and see what their score would be if they were to adopt more soil health-minded practices such as using cover crops or no-till or changing their fertilizer.
So it’s a decision-making tool farmers can utilize to see how they can improve their score, and then if a farmer wants to move forward and do more and get verified, we charge them a per acre annual fee to go through the third party verification program.
The thing is, the farmers own their data the whole time. As a farmer myself, I know that it’s very important that farmers continue to own their data. That’s information farmers need.
Now, in practice, as this government program is implemented at scale, we’re going to have private sector companies helping to administer it, with guidance from our government agencies.
I mean, as I said, it’s a big lift to get this tax credit up and running, and we’ve got to let the free market do its job to help.
As for our role, we give the farmers their baseline carbon intensity score for free, we give them the tools that they can use to improve their score, and we offer consulting as well, if they want some hand holding and additional guidance in adopting these practices.
That last piece really goes back to the roots of my company, which was a consulting company and a soil health data company … so we have historical expertise in that space.
REM: What’s the biggest challenge to a farmer wanting to reduce his or her carbon footprint?
MH: Changing practices and understanding. I guess what it boils down to is, if you’re going to adopt more of these sustainable, regenerative practices, like cover crops, for example, you have to understand how to overcome the logistics and economic risks of change.
The logistical risk of change revolves around figuring out things like what kind of cover crop to use. Do I need to change my equipment? How do I manage this cover crop?
And then we have to cover the economic risk. If you do cover crops incorrectly you can lose yield, you can lose revenue, or you can lose profitability.
The tax credit helps to overcome the economic risk by offering a carrot that is unlike one we’ve ever seen before, and it’s not driven directly by subsidies, rather it’s being driven by a tax credit and an outcome-based program.
I personally like that a lot. And I think a lot of other farmers like it as well. Under this tax credit program, farmers ultimately get to choose the practices they wish to implement and they can lower their carbon intensity score by the means that fit them best.
I mentioned earlier that the average farmer here in Iowa is seeing a score of 11.5 per bushel on row crops, but here on our farm, our corn this year had a score of 2.3 and my soybeans were a negative nine. My dad had some soybeans that were negative 16.
So we can really get low, low scores, but each farmer needs to understand how to overcome the economic and logistical risks of change.
REM: So would you say that 45Z is the biggest deal, in terms of a tax incentive, that farmers have gotten in a long time, if ever?
MH: I don’t know that I can really speak to that. I mean, there have been other changes made by lawmakers, like the stepped-up basis, which adjusts the value of inherited assets to the market value at the time of the owner’s death, and to the death tax itself, that have had monumental impacts as well.
But what I would say about 45Z is that if done correctly, it will have a bigger positive effect on the adoption of sustainable agriculture than any farm bill program or or anything else that we have seen.
If it gets implemented correctly, it’s going to change global agriculture because of the ripple effect and the precedent that it’s going to set. It’ll change global agriculture, and I’m already in conversations about how this can be implemented in Brazil and Australia and other places around the world that are also trying to decarbonize.
They’re watching us, and they’re watching our policy makers in D.C., and our policy makers need to follow the law and utilize the GREET model. They need to follow the law and get these rules out in as timely of a manner as they can.
And obviously, now the clock is ticking. But yeah, this program will have a massive, massive impact on American agriculture, but it will also have one on global ag as well, and especially for American agriculture that is not in a great financial situation right now, and the outlook in the coming years looks like it could be fairly rough.
A program like this is really a shining light at the end of the tunnel that that farmers need, you know, and incentivizes great behavior, incentivizes implementing more sustainable ag practices that are going to create a positive outcome – long beyond the tax credit life cycle, you know?
REM: Let me ask you a potentially dumb question. We always hear how tough it is to be an American farmer. And it is tough. But I think some Americans scratch their heads and wonder why; after all, we all go to the grocery store and purchase your goods. So could you explain the basic economics of farming?
MH: Well, there’s a lot to the answer to that question. For one thing, there’s a lack of transparency in how that food dollar is shared. That’s probably the biggest factor driving that disconnect.
I mean, the products that I’m growing on my farm don’t directly go to the consumer. There are a lot of hands in there. There are a lot of slices that get taken out of the pie between the farm and the end consumer.
Also, farming is just very capital intensive: There’s the equipment we use, the land that we are operating on, all of that is very expensive.
What I like about 45Z is there’s an opportunity here for tremendous transparency and sharing, because we know what the law says the scores are worth. On that score, there’s a great deal of transparency from the farmer right on up to the Internal Revenue Service. And I think, if this works as intended, it will help improve transparency between farmers and processors and distributors and retailers … all those entities that need a cut. Now, I acknowledge everybody involved in the process needs to make money, but there needs to be more transparency. That’s really what it boils down to.
REM: One last question, and it’s not intended to be political in nature. As you know, we’re at the end of the Biden administration and President-elect Donald Trump is about to assume office for the second time. With the change of occupancy in the White House, there will be a new Ag secretary, a new energy secretary and so forth. We touched on the idea of uncertainty earlier, so let me ask you this: How confident are you, even if you get guidance on 45Z from the Biden administration, that the program will continue once Trump is in office?
MH: There are a lot of unknowns with the Trump administration coming in. However, 45Z has very good bipartisan support.
There are already bills that have been introduced in the House and Senate to extend the 45Z program to be a 10-year program. It’s currently written to be a three year program, but there is bipartisan support to extend it. The Republicans on the House, Ways and Means Committee recently closed a request for information. They are trying to better understand this as they prepare for tax discussions to be had here in 2025.
So we’re seeing very good bipartisan support for this bill, and I like that it really does a lot of good.
It is great for farmers and great for the adoption of more sustainable agricultural practices that are going to help the environment, and it’s a real shining point of the inflation Reduction Act.
At the same time, and this may be the key to answering your question, it also does continue to enable the use of liquid fuels. Now, I know there are certain groups that don’t like liquid fuels at all. Personally, I’m in the camp that believes we’re going to have liquid fuels for a long time, whether it be in our road vehicles or our jets or .. whatever. We need to have all the options on the table.
Now, I have been very aggressively working with the Biden administration, and they’ve been great to work with and I anticipate that there’s going to be a lot of work that’s going to be needed to be done with the Trump administration.
But if we really want to stimulate the American economy, especially in middle America, if we really want to have more energy, low cost energy, we need to have all the options on the table.
And I think this (45Z) is an excellent program that gets that done while not directly adding to the deficit. Frankly, I think its being a tax credit is more Trump-friendly, in a way, than other programs might have been.
