Direct Action Policy - state of play and methodologies for ...€¦ · First sales of Australian...
Transcript of Direct Action Policy - state of play and methodologies for ...€¦ · First sales of Australian...
An Introduction to the CFI and CarbonTrading.
Direct Action Policy - state of play and
methodologies for Land Sector.
EMISSIONS, TRADING, AND THE CFI
Milestones 2006-2011 US tour: links with senior scientists & economists 2006
World’s first Carbon Farming Expo & Conference 2007
“Soil Science Summits” between farmers and scientists 2007
First sales of Australian Soil Credits to start the Australian Voluntary Market 2007
Soil Carbon Trading on platform of all parties Federal Election (except Government) 2007
PM Rudd announces soil carbon on national agenda 2008
Carbon Farming Initiative announced as election commitment 2009
Framework developed 2010.
Passed into legislation July 2011.
Bridge Consortium method submitted September 2011. In conjunction with 5th annual Conference
First Country to have a comprehensive Kyoto/Non Kyoto trading framework backed by law.
Milestones to 2014
7th annual carbon farming
conference and expo
Accepted as a ‘Registered
Offset Entity (ROE)
Accepted for AFSL
Implemented project. Sold
carbon into market
Identified partners for
others.
CLIMATE CHANGE:
Extreme weather events
“Uamby” 75mls in 35mins
“Uamby” 75mls in 35mins
Adapting to Climate Change
Enjoying the ride
“Uamby” 2 weeks after 75mls
Rested Paddocks
Sacrifice Paddocks
Sacrifice Paddocks
Conventional
Farming
Carbon
Farming
WHAT IS EMISSIONS TRADING?
• A system to help countries with legal requirements to reduce emissions or who wish to do so voluntarilyusing binding targets. Countries who have signed Kyoto have binding targets.
•Carbon emissions considered favourably for a trading system as the reductions can take place anywhere in the world. A tonne of CO2 is a uniform, international unit.
•So, if one country (A)cannot reduce its own emissions cheaply, they can pay another which can - Country (B)Country B may have more ways to reduced emissions.
•Also applies to companies within a country.
What are Carbon Offsets and where do
they fit?
• Two distinct ways to reduce your CO2 load, and achieve
your targets.
• 1. Lower emissions - via efficiencies then wind, solar,
manure flaring etc. Included under Direct Action.
• 2. REmove CO2 from the air - Trees, Soil these are referred
to as ‘sinks’.
• Sinks remove carbon from the air, emissions reductions
prevent carbon from being released into the air.
How does the ‘Trading’ work?
• Operate through the use of tradeable certificates.
• In Australia these are called Australian Carbon Credit Units (ACCU’s).
• Representing a tonne of CO2e
• The ‘currency’ in all schemes is a tonne of ‘pollution’ or Carbon dioxide equivalent.
• CO2e = Carbon dioxide equivalent = tonne of Carbon x 3.67
• Eg: Methane gas is reduced to CO2e for trading.
• “Currency” enables parties to trade between themselves to achieve the lowest cost means of achieving a target.
Coalition Policy Carbon ‘trading’ still contentious. But it won’t go away. Many
countries now taking action.
Current policy is called ‘Direct Action’ and is to be
administered via a reverse auction under the ‘Emissions
Reduction’ Fund. Essentially Voluntary.
Administered by the Clean Energy Regulator
Requires price on carbon to be removed. This is achieved.
Target is 5% by 2020 reduction. Some 450 million tonnes
Other, non Land sectors now able to enter CFI under DA.
Legislation will be introduced soon.
CFI for Groups under DA Large parcels of Carbon will be preferred under DA.
Sectors best arrangement will be to ‘aggregate’
Aggregation can be by Landcare group or other groups.
Carbon Farmers has a program called ‘The First Million Tonnes
to:
Assist aggregation – Provide necessary services. Help groups
understand. Hold necessary licences.
Sign up here or on www.carbonfarmersofaustralia.com.au
Project Methodology
The ‘Recipe’ book (in Greek!)
The methodology ‘rules’. No approved ‘meth’, no project!
Methodologies: Contain rules for measurement and verification
Methodologies: project-specific rules for monitoring, record keeping and reporting on abatement.
Paperwork requirements may be high, but software will come.
“Methodologies should be consistent with relevant scientific results published in peer-reviewed literature”
Government Departments do best efforts to also put out ‘guides’ for implementation. AND ‘tools’ for calculations.
Soil Carbon ‘Meth’ Soil carbon meth now approved. Can be viewed at:
http://www.cleanenergyregulator.gov.au/Carbon-Farming-
Initiative/methodology-determinations/Pages/Sequestration-
methodology-Sequestering-carbon-in-soils-in-grazing-
systems.aspx
25 Year Soil Carbon Unit will be available
More ‘Streamlining’ of the CFI to come.
This ‘meth’ will reward farmers for increasing soil carbon under
changed management systems in grazing systems.
Vegetation ‘Meths’ : Update. Available ‘tree’ meths
Human-Induced regeneration of a permanent even-aged native
forest
Native forest from managed regrowth
Native forest protection (avoided deforestation)
Permanent environmental plantings of native species using the
CFI reforestation modelling tool
Quantifying carbon sequestration by permanent plantings of
native mallee eucalypt species using the CFI reforestation
modelling tool
Reforestation and Afforestation
Second Generation ‘Tree’
Meths. Some of the above methodologies are undergoing their first
‘variations’.
A number of the forestation/re-afforestation meths above are
being re-developed, to use FullCam as their calculations model,
not the RMT (reforestation modelling tool).
This is as a result of incorporating more up-to-date calculations
for sequestration.
In many cases this would lead to increased sequestration
calculations.
Good example of the ‘evolution’ of methodologies.
TWO further potentials for
Beef Producers. Up coming methodologies for beef producers include:
1. Feeding Beef Cattle Nitrate supplements. This meth
involves substituting nitrates for urea as a non-protein
nitrogen supplement for beef cattle. Fed instead of Urea
blocks.
Early Finishing of Beef Cattle . For those who can
manage their property to increase the rate of liveweight
gain of their herds. They reduce the average age of
animals, thereby reducing methane.
‘Farm Forestry’ Meth This is the ‘agroforestry’ methodology.
At time of writing, it is awaiting endorsement from the
Minister, after which it will be approved for use.
From previous discussion, the guiding principles have
been:
To avoid the issues around MIS schemes.
Likely therefore to include relatively small blocks –
100ha maximum.
Upcoming Non Land Sector
‘Meths’ Coal Fugitive Emissions: Methods for converting methane
coming out of coal mines to CO2e.
Building Energy Efficiency: The Department is building on
several existing NSW Energy Savings Scheme (ESS)
methods.
Industrial Energy Efficiency: The Department is also building
on existing work to develop industrial energy efficiency
methods.
Transport: A transport method is being developed for
efficiencies.
Various new and Streamlined ‘waste management’ meths.
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Farmer
Aggregator
Retail/Farm Gate Market
Carbon Farmers of Australia Market Mechanism
Database*
Buffer Pool
Soil
Carbon
Units
Pool
Auditor
Australian
VoluntarySo
il Carbon
Standard
Brokers
Carbon
ExchangesCorporate
Market
*Web-based system for tracking environmental counters across a large group.
Steps to a “Project” Source: http://www.cleanenergyregulator.gov.au/Carbon-
Farming-Initiative/How-does-it-work/Pages/default.aspx
Absolute outline here. There is much ‘detail’ in these
steps.
1. Plan a project - Choose an available and appropriate
‘meth’
2. Apply to participate in the Carbon Farming Initiative
3. Apply for approval of your Carbon Farming Initiative
project
4. Reporting and crediting 5. Participating in the market
Multiple Roles of the Aggregator
Parcelling orders
Pool manager
Registry Maintenance
Oversee measurement
Trader
Educator
“Middleman”
Role of Aggregator
Who is likely to Aggregate?
Councils? Suppliers?
Farmer Organisations eg. In the USA, Pacific Northwest Direct Seed Association, Iowa
Farm Bureau, The National Farmers Union, Aggregate (North Dakota Farmers’ Union)
Private Companies eg. In the USA- NCOC, Flatlander Environmental Services, CROP
Suppliers eg. N/C-Quest (Bio-Agtive), CRT, Elders.
NRM agencies Eg., LandCare Groups.
Legal obligations will apply - need to be well aware of these.
28
Price Expectations – 2 Markets.
There are two carbon markets which have different price dynamics.
“Compliance” or mandatory market
for companies who must pay for offsets to comply with their country’s Kyoto target or other National targets.
want the lowest price possible., but largest volume.
Our former ‘price on carbon’ was mandatory.
“Voluntary“ market
used by those who want to go beyond their target, or who are not ‘mandated’ to make a change.
buying enough units to ‘cover their carbon footprint’
can claim they are carbon neutral.
Higher price, much lower volume.
Anomaly with Direct Action While the above slide applies MOST of the time, Direct Action
is actually an exception to the rule!
Why? Because it is essentially a VOLUNTARY market –
potentially with a ‘safeguard mechanism’
But it wants high volume, at a low price – normally the domain
of the Mandatory Market.
Essentially, under DA, the Government is the only buyer, not
the polluters. Essentially voluntary.
Price not known due to reverse auction.
Voluntary offsets need not be
low quality/low value
Domestic offsets
were selling in
Switzerland for 130
Euro while CDMs
fetched only 15
Euros during 2011
Why Buy Australian
Farm Credits?
Buys us time
Soil health
Landscape restoration
Drought buffer
Support family farming
Build your brand
What can Carbon Farmers of Aust. do?
Project identification, methodology identification or development and project feasibility analysis
Assist in the documentation and application process for becoming a recognised offsets entity
Assist in obtaining a declaration that project is a eligible offsets project
Provide project planning and management services
Provide services for obtaining certificate of entitlement
End result: ACCUs issued to Client’s Registry account
Phase
2
Phase
1
TAKE CARE! Don’t commit your entire property to any one scheme
Put a toe in the water
“Baseline” as soon as a methodology is approved
Sign up at www.carbonfarmersofaustralia.com.au for updates
Get advice from people who have a track record
If it sounds too good to be true, it probably is
Learn about the CFI - rules, rights etc.
Learn about Emissions
Urgency