Some Prairie farmers are looking to a future where they can make money selling "carbon credits" to industrial polluters.

They're participating in a $1-million pilot project that's paying them to take carbon out of the air and fix it in the soil.

They're getting credits to follow certain farming practices, like zero till, which involves seeding without plowing up the fields. The result is that the crops absorb carbon dioxide and the carbon stays fixed in the soil.

Ottawa then leases the credits from the farmers, paying $2.38 to $5.43 per acre, depending on the type of soil.

The idea is to see how such a program might work if carbon trading caught on. Under proposed schemes, polluters, factories or governments could someday be looking to offset their greenhouse gas production by buying or leasing credits from those who are taking carbon out of the atmosphere.

About 194 farmers enrolled in the federal program in its first year, with about three-quarters of them in Saskatchewan.

Among them is Don Horsman, who farms near Fort Qu'Appelle, and hopes the program is eventually offered to all farmers.

He's learning the ins and outs of carbon-credit trading and thinks leasing, rather than selling credits, is the best option for farmers.

Some farm groups think there are still some kinks in the program to be worked out. For example, under the current rules, unseeded acres aren't eligible for carbon credits, so the Saskatchewan farmers who were flooded out in the spring would be out of luck.

Blair McClinton, the executive manager of the Saskatchewan Soil Conservation Association, says the program has to be more flexible to take into account mixed farming operations, where people have livestock as well as crops.

The program, formally known as the Pilot Emission Removals, Reductions and Learnings (PERRL) initiative, was launched by the former Liberal government as part of its climate change action plan. It expires a year from now.

After that, it will be up to the government to decide if it wants a full-fledged carbon trading program for Canada.