Carbon farming | Landholders Driving Change

SPOTLIGHT

AUSTRALIAN State and Federal governments offer a range of assistance and incentive programs to the agricultural sector.

These programs involve the provision of tax incentives, cash grants or concessional loans to successful applicants.

They commonly target projects in the areas of collaboration, business improvement, infrastructure investment, energy efficiency, and technical research and development.

During the coming months in The Grit, a spotlight will be focused on programs of potential interest to graziers in the BBB.

In this issue, the spotlight is on CARBON FARMING.

What is carbon farming?

CARBON farming projects generate income for landholders through changes in land management practices that reduce greenhouse gas emissions or store carbon in soil and vegetation.

The Emissions Reduction Fund (ERF), is a government-run offsets program that allows landholders to implement carbon storage or emissions abatement activities to generate, and sell, carbon credits.

These carbon credits are called Australian Carbon Credit Units (ACCUs) each representing one tonne of stored carbon dioxide equivalent (tCO2-e) or avoided emissions through approved management activities and methodologies.

Eligible activities that landholders can undertake to produce carbon credits include:

  • changes to livestock management;
  • protecting native vegetation at risk of clearing;
  • regeneration or reforestation of native vegetation; and
  • improving soil carbon.

Many of the techniques used in carbon farming are consistent with best practice management approaches for sustainable agriculture. They can also lead to improved farm efficiencies and profitability.

Emissions Reduction Fund

THE Emissions Reduction Fund (ERF) was introduced by the Federal Government in 2014 as part of the Direct Action Plan to cut greenhouse gas emissions by 5 per cent below 2000 levels by 2020.

The ERF is a voluntary scheme that aims to reduce Australia’s greenhouse gas emissions by providing incentives for a range of organisations and individuals to adopt new practices and technologies to reduce their emissions.

ERF projects must be conducted according to an approved method and a number of activities are eligible under the scheme.

Those taking part may be able to earn Australian Carbon Credit Units (ACCUs), with one ACCU earned for each tonne of carbon dioxide equivalent (tCO2-e) stored or avoided.

ACCUs may be sold to generate additional income, either to the Government through a Carbon Abatement Contract or on the secondary carbon market.

Quick Q and A

Q: Do I have to include all my land in the project?

A: No. You get to determine how much eligible land will be included

 

Q: How long is the Emissions Reduction Fund (ERF) contract in place for?

A: The crediting period for a registered project is 25 years, an ERF contract is for 7 or 10 years.

 

Q: My land is leasehold, can I still participate in the ERF?

A: Yes. Leasehold or a rolling lease does not prevent you from participating. However, you should seek legal advice.

 

Q: What happens if I want to sell my land?

A: A registered ERF project and contract can be transferred to new owners

Q: What happens if I have a fire, flood or drought?

A: Natural events are unavoidable and you will be liable for losses of carbon. However, it is expected that the carbon stock will recover with proper ongoing management so that over the longer term there will be minimal or no loss of carbon. You can apply your own safety mechanism by holding onto some of your Australian Carbon Credit Units (ACCUs).

Q: Do I have to sell the Australian Carbon Credit Units (ACCUs) when I register them?

A: No. After listing, they are like a share and can be held or sold.

Want to know more?

LDC Project Manager Andrew Yates

andrew.yates@nqdrytropics.com.au

Clean Energy Regulator

www.cleanenergyregulator.gov.au

Carbon farming in Queensland

www.qld.gov.au

How to Participate

ONCE you have made the decision to set up a carbon farming project using a particular method, there is a four-step process to follow to participate in the Emissions Reduction Fund. For further information: (www.cleanenergyregulator.gov.au).

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Exploring New Incentives

EXPLORING New Incentives is one of five activity areas of the Landholders Driving Change project. Exploring New Incentives is working closely with landholders to investigate a range of approaches that reward good practice, and identify which options to pursue in the BBB.

These could include market-based approaches such as grants, concessional loans, insurance mechanisms, stewardship payments, stamp duty relaxation, rate rebates, taxes, levies or market premiums.

Some practice changes may only require short-term financial assistance, while others may need additional support to help maintain long-term benefits.

KEQ #1

Figure 1. Total fine sediment reduction by project type and erosion source. Inset shows the proportion of the total project area for each project type.

These estimates have been calculated using two methods: 

1) The pollutant reduction component of the Alluvium/Great Barrier Reef Foundation (GBRF) investment tool for hillslope and streambank erosion management projects; 

2) The Reef Trust Gully Toolbox method for gully erosion management projects. The LDC Water Quality Report 2020 (Waterhouse et al., 2020) highlights that a number of assumptions underlay these calculations, therefore these figures should be treated as the best available estimate of sediment reductions to date.

Preventing sediment from reaching the Great Barrier Reef

Each wet season sediment is washed into local waterways and out to the Great Barrier Reef (GBR). 

Most sediment is very fine, and can stay suspended for a long time and can travel great distances. Valuable topsoil is lost from production, and increased concentrations on the reef can be harmful to seagrasses and corals. 

Landholders in the BBB have completed 69 on-ground water quality practice changes, and it is estimated that these have contributed a fine sediment reduction of 6,154 tonnes per year from reaching the GBR. 

Of this, approximately half of the sediment savings are attributable to grazing land management changes on hillslopes and streambanks, and the other half as a result of gully remediation treatments across a broad range of scales, as shown in the graphs above. 

The table below also highlights the relatively small area of intervention in the gully management projects compared to the large sediment savings that these can achieve - 60 per cent of the sediment savings over only 4 per cent of the project area.

Table 1. Estimated sediment reductions (tonnes) from projects completed in the LDC Project to date.

KEQ #2

*GLMWW = Grazing Land Management Wire and Water

KEQ #3

*The Exploring New Incentives activity area has provided an opportunity for graziers to adopt improved land management practices through a range of activities. For some of these properties, it was the first time they signed contracts for on-ground works.

KEQ #4

The LDC project monitors four gully sites (represented in this table) with gold standard equipment and analysis, carried out by CSIRO.

Results have been compiled in a preliminary report from Bartley et al (2020), with the final report expected to be released by the end of 2020. The preliminary report shows all four sites have indicators of improvements, notably the Strathbogie and Mt Wickham sites.

KEQ #5

KEQ #6

KEQ #7
KEQ #8

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Reef regulations - grazing, standard conditions

  1. For land in good or fair condition (more than 50 per cent ground cover at 30 September), continue using measures to maintain land condition.
  2. For land in poor condition (less than 50 per cent ground cover at 30 September), steps must be taken to improve land condition.
  3. For land in degraded condition (less than 20 per cent ground cover at 30 September), steps must be taken to improve land condition OR prevent areas from further degrading or expanding.
  4. Keep records of measures taken and also of agricultural chemicals, fertiliser and mill mud or mill ash applied to land.
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