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CarbonSmart goes up in smoke

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Issue date: 
16 Jul, 2010
Publisher Name: 
Stocks and Land
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A PIONEERING attempt to provide landholders with a new income stream through forestry offsets, Landcare CarbonSmart, has fallen foul of the Canberra stalemate over emissions regulation.

Set up by Landcare Australia Limited, in part to help landholders put in smaller biodiverse plantings that could provide a carbon credits income stream, CarbonSmart has been killed off because the forestry offsets market and regulatory environment failed to mature as expected.

Landcare Australia chief executive, Heather Campbell, said CarbonSmart was a “brilliant concept” that may have been ahead of its time.

“We went in very early on, and developed up great capability with businesses, but didn’t fully recognise the administrative burden of such a system and the immature nature of the market.

“The administrative processes just kept changing, and the burden on the organisation was huge. One week you would go to register carbon on title, and the titles office in that State would accept it; the next week they would want them filled out in a different way.

“Add to that the fact that we are a small not-for-profit organisation, and we got to the point where we decided that continuing as a carbon broker wasn’t worth the risk it posed to Landcare Australia Limited.”

CarbonSmart did not forward sell carbon, so the broking business will wind up with all participating landholders paid up for carbon their plantings have sequestered to this point.

Ms Campbell said Landcare Australia hopes to continue to use the skills of CarbonSmart assessors as advisors, with an eye to redeploying them if the forestry offsets market gets on a more steady footing.

An architect of the CarbonSmart program, Ben Keogh, managing director of Australian Carbon Traders, said Landcare is a victim of Canberra’s policy vacuum on forestry offsets.

“CarbonSmart was set up with the best of intentions, a lot of thought and effort went into it to establish it as a long term project, and it was definitely established for the landholders’ benefit,” he said.

“Some of the people on that team worked through some extraordinarily difficult times and put in some extraordinary hours, and to see it all vapourise within a political vacuum is a disgrace.”

Policy uncertainty is wreaking havoc on businesses established in the belief that some form of emissions trading policy would now be in place.

“If we had a start date, or even a definite ‘no’, we’d know what to do,” Mr Keogh said.

“But for forestry offsets, we’ve been told it’s a ‘no’ under the voluntary scheme and ‘maybe’ under the mandatory scheme. What are we supposed to do with that?”

A former forester, Mr Keogh is doubly perplexed that the government has on the one hand delivered so much rhetoric on the need to address climate change, while on the other it has “hung out to dry” those who want to tackle the issue through trees - a proven, quantifiable technology.

“We’ve watched people with investment money just walk away. It beggars belief.”

Administrators have also been called into 10-year old carbon management company Carbon Planet, AdelaideNow reports.

Carbon Planet apparently has $5 million in debts, and has asked administrator KordaMentha Adelaide to help revive the business.

According to AdelaideNow, chief executive Dr Ross Williams and executive director Jim Johnson have blamed the Federal Government's decision to abandon the Carbon Pollution Reduction Scheme until 2013 and the global financial crisis for its trading trouble.


Extpub | by Dr. Radut