Image: Ben Poulter.

Australia’s carbon market has been called into question again, with a group of scientists alleging that carbon sequestration in a large portion of the projects has been overstated.

Led by Australian National University professor Andrew MacIntosh, the scientists trawled through Australia’s human induced regeneration projects – which aim to promote the growth of existing trees through changes in grazing management or avoiding systemic clearing.

Going through a series of projects that have been issued a combined 27 million credits, they concluded that the vast majority of them experienced a negligible or negative change in tree cover. It is also concluded that the tree cover change was similar to adjacent areas that were not under a carbon project.

The industry’s peak body the Carbon Market Institute says the study only covered a portion of the data needed to claim carbon credits. (see its full response below)

Behind the scenes, decisions are being made about HIR.

The methodology ceased to exist at the end of last year and the Government is planning to roll it into a new methodology called Integrated Farm and Land Management – with the Environment Department to have a draft of it ready this year.

In recent weeks the department has shown cold feet about the HIR element of the new methodology, indicating to the carbon industry that it was going to push ahead without it. After a series of meetings, the department backtracked on those plans and agreed to keep the original plan of having a draft ready for the end of the year.

The Government will need to sign off on the new methodology for it to exist. It will need a large supply of credits to meet its targets of a 43pc emissions reduction by 2030 and net zero by 2050.

The carbon industry is keen to get on with it, as the prolonged development of IFLM has significantly slowed the development of new projects.

Prof MacIntosh and his team are wanting the concerns they have been raising for years to be taken seriously by regulators.

Caught in the middle are landholders, some who are all for HIR projects, others who are sceptical of them and all of them dealing in a political landscape that is not favourable to bulldozers.

What is the issue with HIR?

Prof MacIntosh and the ANU team are no stranger to highly publicised criticism of Australia’s carbon market. In 2022, he “blew the whistle” on the carbon market for similar reasons to the latest research.

In response, the current Federal Labor Government acted on an election commitment to review the carbon crediting system – commissioning former Chief Scientist Prof Ian Chubb to lead it. The Chubb-review largely dismissed the integrity concerns, with Prof MacIntosh and the team being critical of it since its results were released.

The ANU scientists also say a lot of the projects don’t meet legitimate “additionality” criteria, which means that a change from “business as usual” needs to occur to claim credit for sequestering carbon.

Prof MacIntosh says that a lot of the HIR projects are not “additional” because reducing grazing pressure and managing pests pass the test. He argues that grazing has little impact on tree cover, pointing to the woody thickening on grazing land over the past 50 years – a point regularly made by Beef Central readers.

The claim is refuted by the carbon industry – an issue we will unpack in a future article.

What are landholders supposed to do?

Additionality is a pretty straightforward concept for land that was cleared hundreds of years ago – like has occurred in Europe and Southern Australia. It normally involves planting new trees.

But it is not as straightforward in other areas that have never been cleared or has not been cleared in many years.

Vegetation management laws have seen an extreme shift over the years. They have gone from people needing to clear land to maintain ownership rights to tight controls and big fines to back them up.

In the court of public opinion, environmental groups have ramped up the pressure on the cattle industry for its clearing credentials and companies have responded with policies to rid their supply chains of “deforestation”.

The livestock industry has been trying to keep the emotionally charged land clearing debate in check, with Cattle Australia to release its new definition of “deforestation” at Beef 2024.

“The complexity is real, competing priorities of incentivised outcomes on one hand and regulation on the other.  Which add to that the international definitions and its an incredibly challenging arena to be in,” board director Adam Coffey said.

One Western Queensland producer told AgCarbon Central that if his mulga block was not in an HIR project, he would be pushing the trees for fodder. He also said if vegetation management laws allowed for large-scale clearing he could significantly increase his carrying capacity and make a lot more money from cattle than he does with carbon.

AgCarbon Central asked Prof MacIntosh whether they think the carbon market should be helping in this situation. He said the carbon market had no role in addressing any inequity.

“The integrity of the scheme should not be compromised to address social, financial, biodiversity, or cultural issues,” he said.

Asked whether he thought the tightening vegetation management laws should be recognised by a carbon scheme, Prof MacIntosh said the short answer was “no”.

“This is not the same thing as saying landholders do not deserve compensation for the imposition of land clearing laws. That is a separate issue,” he said.

“The important point here is that carbon credits scheme should not be seen as a mechanism for making transfer payments to address perceived equity issues. Credits should only be issued where there is high confidence the credited abatement represents real, additional and permanent abatement.”

With commitments to reducing stock rates over the long-term being a big one for many landholders, Prof MacIntosh said he was hoping there were emerging market opportunities for them.

“There are already opportunities for landholders to receive financial rewards for reducing grazing pressure and managing pests and weeds through some existing biodiversity markets. However, the opportunities are limited and often temporary,” he said.

“We are hoping that the new Nature Repair Scheme, and new and emerging programs in the states and territories, including stewardship and private protected area programs, will increase these opportunities and make them more predictable and accessible for landholders.”

Prof MacIntosh said he believed there was a place for HIR to be part of the new method.

“Human-induced regeneration projects make perfect sense where they are confined to areas that have been comprehensively cleared, where grazing and/or re-clearing is suppressing regrowth,” he said.

“This is where the method requires projects to be located and the opportunity to undertake these projects in these areas will hopefully be included in any revamped Integrated Farm and Land Management method.”

CMI response

In response to the research published last week, the Carbon Market Institute said the criticism needed to be based off relative data.

The study also draws on Carbon Estimation Area (CEA) data that has become available since the Chubb Review. CEO John Connor said CEA data alone only constitutes a small proportion of the information used to accurately measure project outcomes, and there is the potential for it to be misinterpreted if not accompanied by additional information.

“The release of more project data is important as we move toward a more comprehensive public-facing National Data Platform, as recommended by the Review. However, it’s important that we don’t rush to conclusions from incomplete datasets in the interim,” he said.