Julia Gillard’s carbon sweetener for farms

Under government plans to test-run a carbon market for the sector, farmers will be able to cash in on measures to reduce carbon pollution.

These will include tree planting and reducing fertiliser use.

Climate Change Minister Greg Combet will today issue the first guidelines for the Carbon Farming Initiative, designed to facilitate the sale of carbon credits on the domestic and international market.

Reviving significant elements of Labor’s original emissions trading scheme, the legislation essentially carves out measures contained in the government’s original Carbon Pollution Reduction Scheme legislation that was rejected by the parliament last year.

But environmentalists warn that the benefits for farmers will be limited in the short term, until the introduction of a carbon price increases the likely buyers for carbon credits.

Under Labor’s original plans for an emissions trading scheme, agriculture was permanently excluded but farmers were to be rewarded with offsets for reducing their emissions.

As talks for a carbon price stall and hopes remain slim of a breakthrough at international talks to combat climate change in Cancun starting next week, the new carbon trading scheme for farmers and landholders will begin operation on July 1.

Mr Combet said the scheme would unlock the abatement opportunities in the land sector, which currently makes up 23 per cent of Australia’s emissions.

A fit-and-proper-person test would be imposed on applicants to reduce the risk of fraud.

Farmers and landholders could appoint an agent to report on the project on their behalf.

“This is another example of action being taken by the government to tackle climate change. We are determined to ensure we get the model right, as well as create economic opportunities in a future low-pollution economy,” Mr Combet said.

Potential eligible abatement activities in the guidelines to be released today include:

  • Reforestation and revegetation.
  • Reduced methane emissions from livestock.
  • Reduced fertiliser emissions.
  • Manure management.
  • Soil carbon.
  • Savanna fire management.
  • Avoided deforestation.
  • Burning of stubble/crop residue.
  • Reduced emissions from rice cultivation.
  • Reduced emissions from landfill waste deposited before 1 July 2011.

The Gillard government will continue to prosecute the case for action on climate change, with the first meeting of the Business Roundtable on Climate Change on Friday morning.

“The first meeting will explain how the process will support policy-making, including through the Multi-Party Climate Change Committee process; how carbon pricing relates to the broader reform agenda and the current economic environment; and start to shape a future work plan,” Wayne Swan said in his weekly economic note. “We saw again last week how important it is to the business community that we provide investment confidence through a carbon price.”

Under the Carbon Farming Initiative, farmers and landholders will earn carbon credits that can be sold on a voluntary market to national and international companies wanting to offset their carbon emissions.

To qualify for carbon permits, projects must cause abatement that would not have otherwise occurred.

The abatement must be permanent, it must not cause additional emissions elsewhere and the amount of carbon stored must be based on conservative estimates.

The science behind proposed abatement methods must be supported by peer review. Payment of carbon credits may be paid to landholders in instalments over an extended period such as 20 years for avoided deforestation.

According to the government’s proposed guidelines, farmers and landholders will be able to participate in the new carbon market individually or use specialist companies to manage and report on their projects. Other companies, known as offset aggregators, are expected to emerge to manage offset projects across a number of different farms or parcels of land.

The person with title to the land will be responsible for the performance of the carbon abatement scheme.

If a project fails, the carbon credits will have to be repaid.

South Australian farmer Brian Appelbee, who has planted 6000 trees on his property, said yesterday he didn’t mind there had been no plans to recoup any benefit for his efforts.

“This wasn’t supposed to be a commercial operation,” Mr Appelbee said.

Now, Mr Appelbee said he would be happy to have an extra revenue stream from his 2400ha farm outside Yumali, about 130km southeast of Adelaide.

International buyers for CFI credits may include governments that have obligations under the Kyoto Protocol; companies with emissions obligations under national or regional emissions trading schemes, such as the European Union Emissions Trading Scheme; and organisations voluntarily offsetting their emissions.

Australian buyers of CFI credits could include companies that may have offsetting obligations under state government regulations and organisations offsetting their emissions.

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