Look what Santa brought us: Carbon Credits legislation

Who would have thought 5 short years ago we'd be spending the holiday break working through the proposed legislation for making the dream of soil carbon credits a reality. The Minister Greg Combet has his foot to the floor on the Carbon Farming Initiative. He is releasing the Legislation in the first week of January. We were delivered a preview version on Christmas Eve. The 300-page document would have taken several months to draft, evidence that the Government is serious.

Information on making a submission can be found on the Department of Climate Change and Energy Efficieny's website, click here. To see our paper on the Consultation Paper released by the Department, click here. To see a paper on Perverse Outcomes from Additionality, click here.

We have three critical 'bellwether' issues: Additionality, Permanence and Measurement. Each is capable of delaying the introduction of soil carbon offsets - and even threatening its emergence at all - because these Kyoto principles were devised for factories and forests but not farms.

ADDITIONALITY means that, if the change in land management has already been made or would have been made for business reasons* or becomes common practice in the district, it cannot earn credits because the abatement does not reduce emissions or sequester greenhouse gases any more than if the scheme was not in operation. (*Business reasons can include higher productivity or profitability.)

PERMANENCE is not defined in the Bill. That task is left to the designers of methodologies which will be submitted to the Domestic Offsets Integrity Committee. But there is provision for a 5% "risk of reversal buffer" - this means that 5% of all units submitted by a grower are banked as insurance against losses. Growers could also be asked to "relinquish'' units (ie. repay the money if there is reversal of sequestration). Growers are also subject to Carbon Maintenance Obligations and can be handed a Carbon Restoration Order. Reversal can included losses caused by natural means (drought, fire, etc). The important word in this section on Permanence is "may" in that "The Administrator may... require the project proponent to relinquish a specified number.." Growers who choose to be 'aggregated' into pools can avoid this liability (where the loss of carbon is not intentional) in programs which include their own buffer, such as the Prime Carbon system.

MEASUREMENT is also not specified in the Bill, but emissions, removals and reductions "should be measurable and capable of being verified." Hints are given, such as "a method... should not be inconsistent with the National Greenhouse Gas Inventory". It should also be "consistent with relevant scientific results published in peer review literature." Here we have major problems: 1. If consistency with NGGI means using the method described in Neil McKenzie, CSIRO Land and Water, National Carbon Accounting System, Technical Report No. 14, September 2000, the cost of measurement would make the trade difficult to justify. 2. If peer review data is to set the benchmark for rates of sequestration, the viability of the trade is further endangered because of the widely-accepted phenomenon of "scientific lag" - ie. that Science lags Practice when it comes to reproducing the results achieved in the field by grassroots innovations such as the main techniques used for sequestering carbon in soil. Peer reviewed data is code for 15 years delay while a practice passes through consecutive 3-year trials (+ 2 years for finding funding at the beginning of the cycle and publishing at the end of the cycle.) The Gap between Science and Practice can become institutionalised by the Norton Effect. Professor Ben Norton told a WA Department of Food and Agriculture workshop in 2002, that the majority of published research studies of rotational grazing find that continuous grazing is better than or comparable to rotational grazing in terms of either animal or plant production. Yet “Hundreds of graziers on three continents claim that their livestock production has increased by half or doubled or even tripled following the implementation of rotational grazing…” In the McClymont Lecture in 1998 he said: Science, based on 'hundreds of studies' concluded that planned grazing is not cost effective. (Norton, BE., "The application of grazing management to increase sustainable livestock production," Animal Production In Australia, Vol. 22 1998).

There is one escape hatch from the dead hand of peer review: The Minister. Section 124 (2) says that, if a method is the same as one determined under Subsection 10 (3) of the National Greenhouse and Energy Reporting Act 2007, it is taken to be "consistent with relevant scientific results published in peer reviewed literature." Ss 10 (3) says that the Minister "may determine methods by which the amounts of ... removals ... are to be measured." And the Minister "may specify different methods or criteria for different industry sectors and ... different methods or criteria depending on the circumstances in which the ... removals... occurred." If Minister Combet wants Soil Carbon Sequestration any time in the next two decades - precisely the time when it can play its most important role - he has to bite the bullet on peer reviewed data.