“outcomes for soil carbon · viscarra-rossel 2013. internal report. a comparison of four methods...

“Outcomes for Soil Carbon from the first ERF Auction.”.

Dr Terry McCoskerExecutive ChairmanCarbon Link Limited

July 2015

Contacts: Ignatius Verbeek, COO, Ignatius@carbonlink.com.auTerry McCosker, tmccosker@carbonlink.com.au

Issues to cover

• The first ERF Auction

• What will it be worth to Graziers?

• How will the project proceed?

• How will graziers make it happen?

• Is there still room to be involved?

Wealth Transfer (or Mining?)Melbourne

“A Nation that destroys its SOIL,

Destroys Itself.”

Franklin Roosevelt

The Carbon Game

THE CFI -2011

FIRST ERF AUCTIONApril 2015

Issues to cover

The First ERF Auction

3.4 million t CO2e in 10 year forward contract with ERF &

Corporate Carbon

The ERF Auction

Partners

• Corporate Carbon, RAF, Carbon Link and 350 Graziers.

Methodology

• Sequestering Carbon in Soils in Grazing Systems.

Risk Management

• Corporate Carbon Supply Guarantee

Issues to cover

What will it be worth to Farmers?

Estimated Nett Income @ $11/tTasmania S. Small CQ Buffel Rangeland

Project Area (ha) 10,000 1,000 7,000 20,000

Annual Sequestration (t SOC/ha/an) 1.5 1.5 0.5 0.07

Total Annual CO2e 55,050 5,505 12,845 5,138

10 Year Gross Income $6,055,500 $605,550 $1,412,950 $565,180

Costs

Feasability $5,000 $5,000 $5,000 $5,000

Baseline $50,000 $25,000 $56,000 $60,000

Project Audit $10,000 $5,000 $7,000 $10,000

Remeasure Soil x2 $50,000 $25,000 $56,000 $60,000

Verification Audit x 2 $10,000 $10,000 $8,000 $10,000

Sub-Total $125,000 $70,000 $132,000 $145,000

Govt Discount (25 yr perm) 25% $1,513,875 $151,388 $353,238 $141,295

Annualized Av Nett per ha $44.17 $38.42 $13.25 $1.39

The average annual GROSS MARGIN from CARBON is $16.92 per ha in this example

Is it worth it (1t C/ha/yr)?

Nett Projected Annual Income ($000) on 3,500ha @ $10/t @ 25% buffer

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10

-$42 $21 $21 $21 $21 $299 $21 $21 $21 $21

Yr 11 Yr 12 Yr 13 Yr 14 Yr 15 Yr 16 Yr 17 Yr 18 Yr 19 Yr 20

$299 $21 $21 $21 $21 $299 $21 $21 $21 $21

$721,000 for 11 years

Annual average GM for QLD cattle producers over the last 5 years = $17.30/ha

Irrigated Cotton At Narrabri – Change at Depth

Rochester, Ian J (2010) J Soil and Tillage Research

2. C Change in Irrigated Cotton

Soil Depth Change Change

(cm) (t C /ha/Yr) (%)

0-13 0.3 14%

30-60 1.5 67%

60-90 0.4 19%

TOTAL 2.2 100%

Forced to use 1950s technology

Write off 25% of the Patients

Why not Move into this Century with

Lower Cost, Higher Accuracy and less

Carbon Death?

Indicative Sampling costs.

-

5

10

15

20

25

30

35

- 10,000 20,000 30,000 40,000 50,000 60,000

$/h

a/sa

mp

le r

ou

nd

Project area (ha)

Measurement Cost $/ha/sample round

Current CFI Advanced systems

Issues to cover

How will the Project Proceed?

1. Feasibility SurveyWhat is involved?

Is it feasible?

What will it cost?

How much will I make?

What do I need to do now?

How does a carbon project

work?

When do I get paid?

Who pays me?

Eligible Interest Holder Consent• Bank and Landowner Consent (Ministerial if on

Leasehold land).Project Management Actions• Historic management actions during the 5 years

before• The new management actions that will be

implemented as part of the project• How the project management actions could

achieve the outcomes specified• Actions must NOT commence before the start

activity date

2. Project Establishment

NEW Management Activities

(a) converting from continuous cropping to permanent pasture;

(b) undertaking pasture cropping;

(c) managing pasture through:(i) implementing or changing pasture irrigation;

(ii) applying organic or synthetic fertiliser to pastures;

(iii) rejuvenating pastures, including through seeding; and

(d) managing grazing through:(i) changing stocking rates;

(ii) altering the timing, duration and intensity of grazing.

2. Project Establishment

Eligible Land

• Under pasture for the previous 5 years.

• Land under crop for the previous 5 years

Project Boundaries Delineated

• Mapped boundaries of all Carbon Estimation Areas (CEA’s).

• Mapped boundaries of all Carbon Exclusion areas.

• At least 3 strata for each CEA

2. Project Establishment

StartCannot begin until after Project start date.A. Stratification 10 VARIANTS or STRATA

3. Baseline

65ha per DAY to 800ha per HOUR

Sampling design

Presentation title | Presenter name | Page 34

Design-based approach with

probability samples within

strata optimized to provide

good spatial coverage.

Viscarra-Rossel 2013. Internal Report

B. Coring

10 per

day

60 per

day

3. Baseline

C. Soil Analysis

3. Baseline

NIR

LECO

CT SCAN

D. Calculating SOIL Organic Carbon

1. FIND THE DATA

2. CRUNCH THE NUMBERS

3. GET THE ANSWERS

3. Baseline

E. Calculating Carbon DIOXIDE

∆𝑪𝒃𝒔 = ∆𝑪𝒃,𝒔𝒐𝒊𝒍 + ∆𝑪𝒃,𝑨𝑾𝑩

𝑪𝒃𝒆 = 𝑪𝒃,𝑳𝑺 + 𝑪𝒃,𝒇𝒆𝒓𝒕 + 𝑪𝒃,𝒇𝒊𝒓𝒆

𝑪𝒔𝒐𝒊𝒍,𝒊= { 𝑽𝒊 − 𝑽𝒙𝒊 × 𝝆𝒊 ×%𝑪𝒎 ×𝟒𝟒

𝟏𝟐÷ 𝟏𝟎𝟎𝟎} − 𝑪𝒙𝒊

𝑪𝒔𝒐𝒊𝒍,𝒊 = 𝑽𝒊 − 𝑽𝒙𝒊 ×%𝑪𝒗 ×𝟒𝟒

𝟏𝟐÷ 𝟏𝟎𝟎𝟎 − 𝑪𝒙𝒊

If 𝑨𝑼𝒅𝒑 = 𝑨𝑼𝒅𝒃 then

𝑪𝑳𝑺𝑳 = 𝟎

If 𝑨𝑼𝒅𝒑 > 𝑨𝑼𝒅𝒃 then

𝑪𝑳𝑺𝑳

=𝑪𝒍𝒔,𝒑

𝑨𝑼𝒑× 𝑨𝑼𝒅𝒑 − 𝑨𝑼𝒅𝒃

If 𝑨𝑼𝒅𝒑 < 𝑨𝑼𝒅𝒃 then

𝑪𝑳𝑺𝑳

=𝑪𝒍𝒔,𝒃𝑨𝑼𝒃

× 𝑨𝑼𝒅𝒃 − 𝑨𝑼𝒅𝒑

𝑬𝑪𝑶𝟐𝒆,𝒎= 𝑮𝑾𝑷𝑪𝑯𝟒 × 𝑬𝑪𝑯𝟒𝒆𝒏𝒕𝒆𝒓𝒊𝒄 + 𝑬𝑪𝑯𝟒𝒎𝒂𝒏𝒖𝒓𝒆+ 𝑮𝑾𝑷𝑵𝟐𝑶 × 𝑬𝑵𝟐𝑶𝒇𝒆𝒂𝒄𝒂𝒍 + 𝑬𝑵𝟐𝑶𝒖𝒓𝒊𝒏𝒆

3. Baseline

• Down Hole measurement

• Satellite Interpretation

• Rapid Drilling Technology

• On Farm soil analyses

New Concepts to Reduce costs

Comparisons of measurement approaches

CFI Satellite What’s possibleSatellite latest

A taste of what is coming

% bare ground 1987 to present SOC (t/ha 0-10cm)

Results in 5cm slices from one core

Viscarra-Rossel 2013. Internal Report

A Comparison of four methods of Sampling soil (30 cores)

Random Random Random Stratified

1 Bulk

Density

Average

Bulk D

Individual

Bulk D

Random +

Sensors

Mean 23.25 24.63 23.99 24.49

Variance 18.25 28.23 11.02 0.11

SE 4.27 5.31 3.32 0.33

(Soil Organic Carbon t/ha (0 - 30cm)

Viscarra-Rossel 2013. Internal Report

Issues to cover

How do farmers make it happen?

C

ECOSYSTEM

SERVICES

POOR MANAGEMENT

= SICK ECOSYSTEM

= POOR PRODUCTION

C

ECOSYSTEM

SERVICES

GOOD MANAGEMENT

= ABUNDANCE

An Example – SW Qld

Neighbour 1

Northern Neighbour

Example

3rd Neighbour

Example

GRAZING MANAGEMENT PRINCIPLES

Summary

1. PLAN, MONITOR & MANAGE GRAZING

2. PLANTS NEED ADEQUATE REST

3. MATCH STOCKING RATE to CARRYING CAPACITY

4. MANAGE LIVESTOCK EFFECTIVELY

5. MAXIMUM STOCK DENSITY for MINIMUM TIME

6. MANAGE for BIODIVERSITY

Principle 1.Plan, Monitor & Manage

PLAN your grazing: especially plant and animal

requirements.

MONITOR your grazing: especially rest period, CC, SR

& animal performance.

MANAGE your grazing: especially rest and SR.

Aug 2006

Sept 2007

Nov 2008 – 4.9SDH/100mm

Oct 2012 – 16.7 SDH/100mm

March 2013

BENEFITS OF A GRAZING CHART

Accurate feed budgetingMatching SR:CC

PlanningProjectingScenarios

Paddock yieldsEconomic decision making

Principle 2.Plants Need Adequate Rest

The principle is that plants

require a recovery period

which:

a) during the growth season

means the time it takes to

regrow to the top of Phase II.

This is determined by rate of

growth, and

b) during the non-growth period

is the period of physiological

rest required to ensure root

reserves of energy are

maintained.

ie. fast growth = fast moves

slow growth = slow moves

OVERGRAZING & UNDERSTOCKING

SIGMOID GROWTH CURVE

TIME

YIELD

(kg/ha)

(SDH)

Quantity

I IIIII

The Effect of Rest on Plant & Root Growth

Overgrazed Cocksfoot Well Grazed Cocksfoot

Principle 3.Match Stocking Rate to Carrying Capacity

The Principle is that

Stocking Rate must

be matched to the

Carrying Capacity. No

greater than 40% (C4)

or 60% (C3) of

productivity should

be planned to be

eaten.

WHAT is CARRYING CAPACITY?

IT IS WHAT

GROWS UPFROM THE SOIL

IN RESPONSE

TO RAIN AND

TEMPERATURE

WHAT is STOCKING RATE?

IT IS WHAT

COMES

DOWN FROM

ABOVE AND IS

DETERMINED BY

THE LSUs or

DSEs.

SR < CC SR = CC SR > CC

UNDERSTOCKED OVERSTOCKED

A MISTAKE

…MIGHT HAVE SERIOUS CONSEQUENCES

Principle 4.MANAGE LIVESTOCK EFFECTIVELY

The Principal is that animals should be managed

effectively (this includes _______________)

MAJOR INFLUENCES on ANIMAL PRODUCTION

NUTRITION

WATER QUALITY & QUANTITY

DISTANCE WALKED to FEED

HEALTH (Disease, parasites)

TIMING of REPRODUCTION

GRAZING MANAGEMENT

GRAZING FACTORS AFFECTING ANIMAL PERFORMANCE

1. STOCKING RATE EXCEEDS CARRYING CAPACITY

2. GRAZE PERIOD TOO LONG

3. UTILIZATION RATE TOO HIGH

4. TOTAL QUANTITY TOO LOW

5. REST PERIOD TOO LONG

6. STRESSED LIVESTOCK

Principle 5.High Stock Density

The principle is that maximum stock density

should be applied for the minimum time.

EVEN

UTILIZATIONANIMAL IMPACT

THE TWO BENEFITS OF STOCK DENSITY

Principle 6.Biodiversity

The principle is to use diversity of plants and

animals to improve Ecosystem Services.

Dukes Plains – Theodore, Q

Brigalow (40%)

225 SDH

$113/ha

Brigalow (10%)

166 SDH

$84/ha

Eucalypt (95%)

130 SDH

$65/ha

Softwood Scrub (45%)

196 SDH

$98/ha

LOSS due to Clearing

= $342/ha over 16 years

(excl cost of Clearing)

The New Paradigm

Grazing Management is the KEY – separate TREE

Effects from GRAZING Effects

SUMMARY• Carbon Farming IS a Reality

• It has the potential to change income

• It has potential to help with seasonal cashflow fluctuations.

• It WILL require a change of management and control of stock.

• It is OPTIONAL, as is survival.

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