Dick Adams (Lyons, Australian Labor Party) Share this | Hansard source

The rationale for these bills is to establish the Carbon Farming Initiative to give farmers, forest growers and landholders access to domestic voluntary and international carbon markets. This will begin to unlock the abatement opportunities in the land sector, which currently make up 23 per cent of Australia's emissions. The Carbon Farming Initiative will include a carbon crediting mechanism, the scheme; funding to fast track the development of methodologies for offset projects, including on-farm demonstration of biochar; and information and tools to help farmers and landholders benefit from carbon markets.

In 2010, this government undertook to give farmers, forest growers and landholders access to carbon markets so that they could offset costs that they might incur while they abate carbon emissions, which currently make up 23 per cent of those in Australia. The Carbon Credits (Carbon Farming Initiative) Bill 2011 fulfils that election commitment.

Australia has among the highest agricultural emissions of the developed countries. But because we are a very big country we also have significant opportunities to increase carbon storage in our landscape. This scheme presents an opportunity for Australia to address those high emissions and for the agriculture sector to be part of the ongoing actions to address the changing climatic conditions.

The CSIRO and other research institutions are making important advances in carbon estimation techniques. And, as revealed in the House of Representatives report Farming the future, which included evidence from around the country, innovative farmers have already been developing ways to improve the health of agricultural soils, to improve herd efficiency, to include tree farming as part of their mix and to generally farm more sustainably.

This scheme will drive and reward efforts in developing Australian innovation. Farmers and landholders will be rewarded for their actions to reduce or store carbon pollution. This is a very important step forward for regional and rural Australia. It will create incentives to protect our natural environment and adopt more sustainable farming practices as well as mitigate climate change. Increasing carbon storage in agricultural soils improves soil health and productivity. Revegetation will help restore degraded landscape, protect biodiversity and bring underutilised land into production. Tree planting can help to address salinity, reduce erosion and act as a carbon sink.

In this discussion we have to ask ourselves about the role carbon plays in our daily lives and what it is about its presence in our lives that makes it so important that we do something about it. There needs to be an understanding of what carbon is and how it relates to our lives. We rely on a variety of elements and compounds for life, including nitrogen, oxygen, carbon dioxide, helium, methane and hydrogen. There are some others, but they are not very important to this discussion. A mixture of these makes up the air we breathe. Carbon dioxide is a minor part of the air but it has a major impact as it helps to keep our planet and us warm and prevents us from freezing to death.

Of course, there is also a bad side. Too much carbon dioxide will cause the earth to heat up and become too hot—the greenhouse effect. That is a scientific fact. There is enough science to give us that belief. It is this that is causing us to query the growing carbon content of the atmosphere. It is said that the world has been growing warmer since the industrial revolution because more carbon has been emitted than can naturally be taken up. Therefore, it is important to have some sort of control over the release of carbon dioxide, and setting a price on carbon emissions has been identified by the Stern review and the Garnaut report, among many others, as a critical policy tool for achieving carbon reductions. Therefore, a carbon price needs to be set, but we need to allow time for industry to implement measures to limit or offset the costs so that we can continue to compete in the world market.

One way of coping with unduly high carbon emissions is to relate those to how we can reduce their impact. It means that carbon has to become a commodity that can play a role in the market, much like what has been done in relation to water in this country. Therefore, we need a scheme that will allow sellers to deal directly with buyers and leverage the opportunities of the marketplace. Such a marketplace will allow companies to invest in local land sector abatement through long-term contracts and partnerships with farmers and landholders.

Markets are not new to farmers and nor are many of the things that can save or store carbon, such as trees and soil. What farmers need is a mechanism to add value to their actions and help them decide whether or not to invest. And that is what this series of bills is all about. One of the areas dear to me where this could play a very important part in the future is that of forestry. Carbon markets are one of the elements now falling into place as a potential driver of investment in forestry. By recognising the contribution of forestry to the carbon economy, we are placing a value on forestry which should allow it to compete for investment dollars with other parts of the economy.

Using trees to take up excess carbon is not new and there are other ways to lock up carbon for use in another form. But it needs to work within an economic framework so that industry can be encouraged to lessen its emissions or to trade them with another industry so the overall amount of carbon in the atmosphere is not increased.

Tasmania is well placed to develop our forest industry to be a carbon store in wood products such as building materials and wooden furniture. It can help to provide carbon credits to high emitters. But to do this, we need a trading scheme and a carbon price. Using the carbon trading schemes it is possible for rural industries to work together to develop a more sustainable farming and forestry industry.

For instance, Forestry Tasmania runs a program called Trees on Farms. Trees on Farms encourages landowners to partner Forestry Tasmania in planting trees on land that would otherwise be unproductive. The program provides a timber resource to Forestry Tasmania and a revenue stream for farmers. Forestry Tasmania provides the tree growing expertise and management, the farmer provides the land, the farmer enjoys the environmental benefits of tree growing and both share in the returns.

In the New England region of New South Wales, the Engineered Woodlands Project utilises tree plantings to provide carbon offsets, windbreaks and stock shelters, as well as a harvestable resources. Through careful design, it was possible to place a substantial proportion of a property under trees with no loss of stock-carrying capacity or productivity.

In Victoria, the Otway Agroforestry Network offers an extension service focused on farmers developing forestry skills so that they can have exclusive control of the forestry resources developed on their land. The network focuses on trees as part of the farm infrastructure, providing aesthetic value, environmental services—habitat for birds as part of integrated pest management, stock shelter and revegetation of water courses—while also providing an income stream through the production of high-quality sawlogs.

The key to success was giving each farmer the training and tools to manage the timber on their own properties, within the context of group leadership and peer support. Farmers undertook formal training through the master treegrowers course, and had access to expertise and support within the network.

Network cooperation meant that relatively small stands of timber could be harvested at commercial rates. The result of the network's operation was a significant increase in tree cover without loss of productivity, and an improvement in the commercial and environmental sustainability of individual farm enterprises.

When I listen to the doubters on the other side, I think we have to be careful about the way we treat the scientific data that we hear. If we look at the mountains of information that are currently scurrying around our media sources, our emails, our blogs and tweets and our day-to-day information—if we really come down to the nitty-gritty it appears that, although we know that there are significant changes going on, what we really do not know is their actual impact. Climate change information is only as good as the models that have been put up, and the bottom line is that they are inconclusive.

That is why we get such a range of views around the globe. Nothing is really right or wrong and we will only really know what will happen when it happens. According to Professor Michael Hulme of the University of East Anglia, one of the leading commentators on climate change, climate change projections are only as good as their models, and we know models are not infallible because they are made by us, humans—educated humans, scientists, and other professionals, but humans nonetheless.

So what we are really into is risk assessment—like an insurance company goes through all the possible risks to a body or an individual—and coming up with some plan to mitigate any possible risks. I believe that is what we are about at the moment with this debate. Nothing is absolute and the effects and risks of not doing anything in the long run depends on who you are and where you live. Like insurance companies have done for decades, trading in offsetting their risks, these bills give us an option to work on dealing with a very real risk and helping the big emitters to offset their risks by investing in the carbon reduction activities, such as farms and forestry. Shouldn't we, as decision makers, take decisions to mitigate those risks by setting a price on the cost of reducing a possible severe risk to our world?

Scientists are telling us that there are methods and systems to ensure we do not have to deal with a major world catastrophe sometime vaguely in the future—maybe tomorrow, maybe in a hundred years time. We should make those decisions now and try and alleviate the risk by understanding our systems better. There needs to be some understanding on how each activity can actually be assessed. For example, with tree growth, some trees species grow faster than others, some get a lot bigger than others and therefore will be able to process more carbon. So we need experts to advise us on the best species and the best methods. Therefore, an independent expert committee, the Domestic Offsets Integrity Committee, has been established to ensure that estimation methodologies are rigorous and lead to real abatement.

But trees ultimately die after a finite period and therefore no longer can take up carbon. So there is little point in them remaining upright taking up air space that could be replaced by a young, vigorous, carbon-devouring tree. Managed forestry allows for the trees to reach their economic peak and then be harvested for specific purposes, such as furniture, building materials, paper and even crafts, allowing that stored carbon to be permanently locked up and used elsewhere.

Other elements of the design of the scheme to ensure the integrity of credits include: issuing credits after the sequestration or emissions reductions have actually occurred; tracking of credits through a central national registry, which is included in the registry bill; transparency provisions, including the publication of a wide range of information about approved projects; appropriate enforcement provisions to address non-compliance; and a robust audit scheme based on the National Greenhouse and Energy Reporting Scheme.

Carbon storage has to be permanent if it is going to be treated as equivalent to carbon emissions from the industrial sectors—and what is more permanent than a house made of wood with its fittings and furniture all storing carbon! Participants would be able to cancel their project and hand back credits issued at any time—for example, because they wish to sell the land or use it for something else.

Land managers would not have to hand back credits if carbon stores are lost because of bushfire or drought. This is a very important point to understand. Instead, land manager-holders will be required to take steps to re-establish lost carbon stores. Temporary losses of carbon following a bushfire or drought would be covered by a risk of reversal buffer where a proportion of the credits are withheld.

So a scheme by which we can set a price for carbon and use it for assisting both industry and the rural sector in reducing emissions—which will start to mitigate the risk of further global warming—is essential for Australia. I don't believe we are alone in this. Other countries are starting to work at this problem without signing up to particular protocols; they are minimising their risk.

We have already seen Qantas highlighting that they will have to put up fares next year as the EU has penalised the airline because Australia does not have a price on greenhouse emissions. Qantas will have to pay 15 per cent on its carbon emissions from its nearest port of call. The world will not go away!

We have to start taking these steps. I support the legislation.

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