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Forest & Wood Communities Australia has formally asked the Emissions Reduction Assurance Committee to review the Federal Government’s controversial Improved Native Forest Management carbon-credit method, warning that substantial unresolved questions remain over leakage, additionality and potential over-crediting. Source: Timberbiz FWCA has lodged a formal request under section 255AA of the Carbon Credits (Carbon Farming Initiative) Act 2011, requiring ERAC to consider whether it should undertake a statutory review of the INFM Method. FWCA has also asked ERAC to consider using its section 27A powers to temporarily suspend processing of new projects under the Method while those integrity questions are examined. FWCA Chair Steve Dobbyns said the application was based on specific statutory and technical issues rather than competing views about forest policy. “This is now an ACCU integrity question. If Australian taxpayers and businesses are going to buy carbon credits generated by shutting down timber production, the claimed carbon abatement has to withstand rigorous scrutiny.” The FWCA request identifies six major areas requiring review: the Method’s 40% ceiling on indirect leakage, treatment of international timber imports, additionality of projects linked to pre-existing government commitments, FullCAM modelling and potential over-crediting, different provisions applying to State and non-State project proponents, and substantial changes introduced after public consultation. Leakage cap demands explanation The final Method requires an independent expert to assess indirect carbon leakage caused when Australian timber production is reduced, including impacts occurring overseas, but prevents the deduction exceeding 40%. That ceiling is difficult to reconcile with new Australian research finding that 81.3% of reductions in Australian native forest timber production have been displaced into imports. The same research found 86.8 % of displaced demand was supplied from countries with elevated illegal-logging risk profiles. The study did not directly calculate carbon leakage but concluded that the observed timber displacement demonstrates potentially substantial international carbon and biodiversity consequences. Mr Dobbyns said FWCA was not claiming that 81.3% timber leakage automatically meant an 81.3% carbon deduction. “But if an independent assessor concludes the real carbon leakage is 50, 60 or 70%, the Method appears to force that assessor back to 40%. ERAC should explain how an artificial ceiling can still satisfy the legal requirement for conservative carbon accounting.” Forestry Australia had already warned ERAC during consultation that published forest-carbon leakage estimates ranged from about 42 to 95% and that the proposed leakage treatment was insufficiently conservative. FWCA is also challenging the Method’s treatment of the Great Koala National Park. ERAC acknowledged concerns arising from the NSW Government’s pre-election park commitment but concluded that it was reasonable for a state government to pursue an ACCU project as a means of delivering an election commitment and enhancing its longevity. However, NSW Labor’s December 2022 election costing had already committed $80 million to support establishment of the Great Koala National Park, with the funding expressly identified as coming from the Snowy Hydro fund. “The statutory test is not whether carbon credits make a government policy cheaper or easier to fund,” Mr Dobbyns said. “The test is whether the claimed abatement was unlikely to occur in the ordinary course of events without the carbon-credit scheme. ERAC needs to explain how a pre-existing park commitment with an identified public funding source satisfies that test.” FullCAM and post-consultation changes also under scrutiny FWCA has asked ERAC to independently examine Forestry Australia’s technical concerns that the prescribed FullCAM modelling may systematically overstate the carbon benefit of stopping selective native forest harvesting. Forestry Australia has argued that the Method was not supported by sufficiently clear and convincing evidence and that important modelling assumptions could produce material over-crediting. ERAC itself acknowledged that significant changes were required following consultation, including replacing the original fixed 5% leakage deduction with the final project-specific 0–40% system. FWCA has simultaneously lodged Freedom of Information and other information-access requests seeking the technical basis for the 40% cap, the exact Method version considered by ERAC, post-consultation drafting changes, additionality assessments and other records underlying approval of the Method. Mr Dobbyns said transparency was now critical. “If the Method is robust, an independent statutory review and release of the underlying evidence should strengthen confidence in it.” “If it cannot survive that scrutiny, projects should not be registered and ACCUs should not be issued under it until the defects are corrected.”  

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