10th August 2007Farms can actively participate in carbon emissions trading by decreasing land clearing, changing fertilising practices and reducing methane emissions.
This timely advice was delivered to delegates at the Agriculture Australia 2007 conference in Melbourne by National Australia Bank’s (NAB) carbon finance specialist.
Rachel O’Neill, head of nabCapital’s Carbon Solutions Group, told the conference that although non-energy related emissions for the agriculture and forestry sectors are not proposed to be included in the short term in the emissions trading scheme, there are still likely to be significant opportunities for the farm sector to be involved.
“Farms can still participate in carbon emissions trading even though they have been excluded from the new Australian Climate Change polic, released in July,” she said.
“There were practical reasons why the sector was not included, mainly to do with measurement uncertainties for carbon on-farm and the administration costs of many small sites, but the sector can still participate by generating ‘offsets’ for use in the scheme.”
Such potential offsets may include changes to fertilising practices and reduced land clearing as well as a move to farming practices such as no till which increases the carbon sequestered in the soil.
“Ms O’Neill told the conference there is already a voluntary carbon exchange operating in Chicago in the United States which provides examples of how farmers in Australia could be involved in carbon trading in the future”.
“The Chicago Climate Exchange is expected to trade almost 12 million tonnes of CO2 emissions in 2007, with carbon credits trading at around $US3.80/tonne. In one example, farmers are earning greenhouse gas offsets through practising conservation tillage and planting grasses and trees.
“Through the Illinois Conservation and Climate Initiative, the offsets are verified and aggregated, and sold to members of the exchange.
“There are now more than 570 landowners participating in the project.”
Ms O’Neill believes the time is right in Australia for innovative approaches to carbon trading and the development of new offset methodologies.
“NAB is already building capacity in carbon financing through our nabCapital Carbon Solutions Group, which we formed in 2006 to identify the opportunities in the evolving carbon finance market,” Ms O’Neill said.
“We’re keen to assist clients manage their risks and take advantage of the new markets that are emerging. I have no doubt that carbon trading will soon be a part of every day business management for Australia’s forward thinking farmers.”