background potential opportunities and issues nick dudley
TRANSCRIPT
Carbon Farming Initiative
•Background
•Potential opportunities and issues
Nick Dudley
Regional Landcare Facilitator
West Gippsland CMA
Carbon Farming isn’t new!
Carbon is only one aspect of farming!
Source:
DPI Vic
CFI: Key Messages
•Voluntary scheme
•CFI practices may lead to improved profitability and sustainability – things we want to do anyway
•Potential for landholders to be paid to offset emissions – diversifying income
•At a C price of $23 per tonne of C, is there enough incentive for farmers to be involved?
•Landholders on large properties may be winners
•Current technology does not meet CFI expectations
•Short term gains may lead to long term liabilities
• CFI offsets may attract a lower price if sold onto voluntary, non-Kyoto compliant markets
•Cost of farm inputs will rise under carbon pricing mechanism –clean energy future.
Australia’s carbon emissions
Clean Energy Future, Australian Government 2011
Australia’s carbon pollution profile
6 Source: 2009 emissions from the NGGI 2011, DCCEE analysis
Australia’s carbon pollution profile
7 Source: 2009 emissions from the NGGI 2011, DCCEE analysis
Big emitters
9
http://www.climatechange.gov.au/government/reduce/national-
targets/~/media/government/reduce/NationalTarget-Factsheet-20111201-
PDF.pdf
The Clean Energy Future Plan
• Agriculture and land sectors are excluded from the carbon price mechanism.
• Fuel farmers use for farm equipment and personal vehicles will not be covered under the carbon price.
• Over $1.7 billion of carbon revenue will be invested in the land sector.
Carbon Farming Initiative: Objectives
To give farmers and landholders access to domestic voluntary and international carbon markets.
•To help Australia meet its international obligations, under Kyoto Protocol,
•To create incentives for people to undertake land sector abatement projects by generating saleable carbon credits
•To achieve carbon abatement in a manner that is consistent with the protection of Australia’s natural environment and improves resilience to the impacts of climate change.
Components of the Carbon Farming
Initiative
1. Crediting mechanisms (Scheme)
2. Development of Methodologies
3. Provision of information to help farmers benefit from the scheme
The Carbon Farming Initiative
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• Landholders can receive carbon credits for:
– Reducing emissions
– Increasing carbon stores
– Kyoto and non-Kyoto compliant activities
• Emitters can buy CFI credits from landholders to offset their own emissions
Australia’s agricultural emissions Emissions (Mt CO2-e)
CH4 N20 Total
Enteric fermentation 57.6 - 57.6
Manure management 1.9 1.6 3.5
Rice cultivation 0.2 - 0.2
Agricultural soils - 15.0 15.0
Prescribed burning of savannas
8.1 3.5 11.6
Field burning of agricultural residues
0.2 0.1 0.3
Total agriculture sector 68.0 20.2 88.1
AGRICULTURE SECTOR EMISSIONS, 2007
Source:Department of Climate Change, 2009, National Inventory Report 2007 Volume 1.
Scope of Carbon Farming Initiative
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Domestic carbon price Domestic and International
voluntary markets
International
compliance
market
Recognised in international
accounts
(Kyoto compliant credits)
Not recognised in international
accounts
(non-Kyoto compliant credits)
DEMAND
SUPPLY
Scheme mechanics – key processes
Methodology Approval
Project Approval
Reporting Crediting Termination or
Transfer of Projects
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How the scheme works!
CFI Methodologies status
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Approved
• Capture and combustion of landfill gas
• Destruction of methane generated from a manure in piggeries
• Environmental plantings
• Savanna fire management
Under consideration
• Avoided emissions from landfill
• Management of large feral herbivores in the Australian rangelands
CFI Integrity Principles
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• Measurable
• Conservative
• Based on peer-reviewed science
• Internationally consistent
• Avoidance of leakage
• Permanent
• Additional
Permanence obligations -
sequestration projects only
• Maintain carbon or hand back credits
• Re-establish carbon after a fire or drought
• Risk of reversal buffer
– temporary losses whilst carbon is re-established
– wrong doing that can’t be remedied.
• Carbon maintenance obligation
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Positive and Negative lists
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Additionality
• Go beyond ‘common practice’.
• Project is not required by law.
• Activity is on the Positive List.
Avoiding impacts
• Type of project is not on the Negative List.
• Project has necessary water, planning and environmental approvals from all levels of government.
• Project takes account of regional NRM plans.
Co-benefits
• Provides extra benefits for biodiversity or Indigenous communities.
Examples of eligible activities
SEQUESTRATION • Reforestation
• Revegetation
• Managed regrowth forests
• Rangelands restoration
• Soil carbon
• Native forest protection
EMISSIONS REDUCTION • Fertiliser management
• Manure management
• Reduced enteric fermentation
• Feral camel culling
• Landfill gas flaring
• Savanna fire management
• Native forest protection
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CFI Potential
“Australia had enormous potential for land-sector abatement”
DCCEE 2011
Many of the potential abatement activities are:
“things we want to do anyway”
Co-benefits” of the scheme include:
•Increasing productivity of soils
•Reducing salinity and erosion
•Protection of biodiversity
•Increasing investment in regional Australia
Participating in the CFI
Landholders can participate in the CFI by:
• obtaining the necessary approvals, and managing and reporting the project themselves;
•using a specialist service provider to assist with project reporting and management; or
•allowing other entities, known as offset aggregators, to undertake or manage the offset activity on their land.
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A case study!
Case study: Rob and Carol Tylee, Drouin South
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Rob and Carol Tylee • Property 164 ha
15ha revegetated
• Lease 120ha dry land pasture, 11ha is vegetated or lane – ways
• milking 389 cows carrying 87 Heifers (<1yr) 114 heifers (1 to 2 yrs) Total 590 head
• Produced : 1.4 million litres of milk, 105t milk solids in 2010-11
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31
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Outputs t CO2e/farm t CO2-e/t MS
Fertiliser 335.2 3.2
Grain 48.0 0.5
Other feed sources 50.0 0.5
Fuel production 4.9 0.0
CO2 -Energy 150.1 1.4
CH4 - Enteric 1244.8 11.9
CH4 - Manure 122.1 1.2
N2O - N fertiliser 107.8 1.0
N2O - Effluent pond 1.7 0.0
N2O - Dung, Urine & Spread 144.3 1.4
N2O - Indirect fertiliser 128.0 1.2
N2O - Indirect animal waste 189.0 1.8
Tree plantings -611.9 5.8-
Total farm 1,914.1 18.2
Baseline contributions to total emissions
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17%
6%
54%
23%
Pre-farm On-farm CO2 On-farm CH4 On-farm N2O
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CO2-Fertiliser
CO2-Grain
CO2-Forages
CO2 -Energy
CH4 -Enteric
CH4 -Manure
N2O - NFertiliser
N2O -Effluent
pond
N2O -Voided
andSpread
N2O -Indirectfertiliser
N2O -Indirectwaste
Treeplantings
(-ve)
Sum of allsources
CH4 andN2O only
Baseline 3.2 0.5 0.5 1.5 11.9 1.2 1.0 0.0 1.4 1.2 1.8 5.8 18.2 12.6
Strategy 0.8 0.5 0.5 1.3 11.9 1.2 0.7 0.0 0.9 0.8 1.5 3.9 16.0 13.0
% Change 74.5% 0.0% 0.0% 14.8% 0.0% 0.0% 36.6% 36.1% 31.2% 36.6% 19.2% 33.3% 12.4% -2.7%
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
GH
G e
mis
sio
ns
in
ten
sit
y (
t C
O2e
/t m
ilk
so
lid
s)
Greenhouse Gas Abatement Strategy Comparison
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Potential on farm activities
SEQUESTRATION • Revegetation
• Soil carbon
EMISSIONS REDUCTION
• Fertiliser management
• Reduced enteric fermentation
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Potential on farm activities
Revegetation
• Mean carbon density for above ground component of Vic native forests is 157 tC/ha = 565 tCO2 –e/ha
• Potential on property given soils, climate etc is much higher than this.
Long term
ABARE uses:
MAI - 9m3/ha/yr
C sequestered –
14.5 tCO2-e/ha/yr
Under CFI in 10 years
145 tCO2-e on:
15ha = 2175 tCO2-e
= $50025
= $5002/yr
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Issues:
Establishment costs
Management
Brokerage
Long term C price
Management options known to increase soil
organic matter
Nitrogen fixing plants
Perennial species over annual species
Retaining plant residues
Application of Biochar
Application of organic wastes
Rotational grazing
Pasture cropping
Conservation/no-tillage over intensive tillage
Increased water efficiency and yield
Other radical technologies (eg BioAgtive TM Emission system*)
(* - not yet evaluated using scientific protocols)
(source McBratney and Stockmann 2011)
Potential on farm activities
Soil Carbon
• Research showing 0.2-0.7 tC/ha/yr may be achievable (C. Jones quotes up to 25tC)
• Assuming 0.5tC/ha/yr
over 10 years
= 5tC/ha for 10 years
= 700 tC total over 140 ha grazing land.
= 2569tCO2-e
At $15 /tonne = $38535
At $5 /tonne = $12845
Mid term
Issues:
• Saturation point
• Establishment costs
• Management required to boost carbon
• Brokerage
• Measurement costs
• C price rises
• Co-benefits in terms of productivity , sustainability
• Permanence obligation
• Non-Kyoto 39
Potential on farm activities
Fertiliser Management
• Eckhard et al currently working on a methodology to reduce nitrous oxide emissions by 10%
• Current estimate 236 tC02-e attributed to
• Assuming 23.6 tonne reduction in N2O per year
= $5428 per annum
+ lower fert. and spreading costs
Future
• Untried technology
• Costs of implementing new practice
• C price rises
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Potential on farm activities
Reducing enteric methane emissions
• Use of anti-methanogenic treatments, dietary supplements etc.
• Potential 15% reduction in enteric emissions
• Can be applied each year
15% reduction of 1245 tCO2-e/yr
= 186.75 CO2-e/yr = $4295.25 per annum
Future / on going
• Not yet commercially available
• Costs of implementing new practice
• C price rises
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Farmer concerns What’s in it for me?
How do I get into it?
What costs will I incur?
Permanence and additionality
Is it in the interest of farmers to rundown C before initial assessments take place?
Liabilities, encumbrances on title.
Soil C not included in compliance market
Progressive farmers may have lost out!
General Issues and Concerns Policy and political context - changing ground
Common concerns around additionality and permanence clauses and what is actually included:
What Carbon price will make offset activities viable?
Soil C not included under Kyoto – low price
What costs will be involved – project design, accreditation and verification
Weighing up the cost impact of a mandatory C market versus potential offset revenue
Ifs, whats and maybes! Watch this space.
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What the experts say!
SAM ARCHER: We are locking in land use for the next 100 years. And whilst sitting here now we may be able to look out 10 or 20 years and say, "OK, that would be a prudent move," I think it would be - it's challenging to contemplate locking land use in for 100 years. Sam Archer is:
Non-Executive Director at Rural Industries Research and Development Corporation (RIRDC)
Non-Executive Director at NSW Farmers' Association
Member: Research Advisory Committee at Australian Farm Institute (AFI)
Mick Keogh, Australian Farm
Institute, UDV Conference 2011
Soil carbon according to Jeff Baldock
•The costs from assessing C in the soil currently outweigh hugely what a farmer could be expected to gain from selling carbon offsets.
•Opportunities for building soil C exist where current systems are inefficient
•Alternative systems with increased ability to capture C are available
•The possibilities of future liabilities and uncertainty about C pricing have big implications in regard to selling soil C credits.
Soil carbon sequestration: Fiona
Robertson
With current management practices, there is little potential for soil sequestration in the Victorian cropping industry that could be used in C accounting and trading. Inclusion of pasture phases in crop rotations is the only reliable way to sequester C in soils under cropping, and it would take 10- 25 years for the sequestered C (8-11 t C/ha) to become measurable.
CFI: Key Messages
•Voluntary scheme
•CFI practices may lead to improved profitability and sustainability – things we want to do anyway
•Potential for landholders to be paid to offset emissions – diversifying income
•At a C price of $23 per tonne of C, is there enough incentive for farmers to be involved?
•Landholders on large properties may be winners
•Current technology does not meet CFI expectations
•Short term gains may lead to long term liabilities
• CFI offsets may attract a lower price if sold onto voluntary, non-Kyoto compliant markets
•Cost of farm inputs will rise under carbon pricing mechanism –clean energy future.
Funding and Support
Grants and Funding: • Melbourne Water Stream Frontage Management Program (ongoing) • Targeted Land Stewardship Program (Central Westernport, South
Gippsland and Bass Coast only) (ongoing) • Community Action Grants (Applications close: 27th of March 2012) • Download the Landcare Community Grants Guide at
http://www.landcarevic.net.au/resources/funding/landcare-community-grants-guide/view
Support: • Join your local Landcare Group! (i.e. access to local support, knowledge,
learning and funding opportunities, plus a great social network!!) For more information about Landcare, funding and other support opportunities please see/contact your regions Community NRM Coordinator
Landcare and Community Outreach
Manager
Doug Evans
Employer – PPWCMA (Christmas Hills)
Ph: 03 9712 2296
Email: [email protected]
Bass Coast Community NRM
Coordinator (0.5FTE)
Joel Geoghegan
Employer – BCLN (Cowes)
Ph: 03 5951 3318
Email:
Central Western Port Community
NRM Coordinator (0.5FTE)
Bridgette Sullivan and Geoff Boyes
Employer – CEC (Pakenham)
Ph: 03 5941 8446
Email; Bridgette:
Or Geoff: [email protected]
Yarra Community NRM Coordinator
Emmanuelle Brunet
Employer – PPWCMA (Christmas Hills)
Ph: 0429530499
Email: [email protected]
Northern Community NRM
Coordinator
Grant Godden
Employer – PPWCMA (Sunbury)
Ph: 03 9781 0199
Email:
Werribee Community NRM
Coordinator
Will Hogg
Employer – PPWCMA (Sunbury)
Ph: 03 9218 5600
Email:
Mornington Peninsula
Community NRM Coordinator
Matt Khoury
Employer – PPWCMA (Frankston)
Ph: 03 8781 7945
Email:
South Gippsland Community
NRM Coordinator (0.4FTE)
Kathleen Bartlett
Employer – SGLN (Leongatha)
Ph: 03 5662 5759
Email: [email protected]
