356. Letter to Minister for Emissions Reduction
This is my draft of a letter to the Minister asking a set of questions about soil carbon in the context of the Government’s new climate change document, “Australia’s Long-Term Emissions Reduction Plan”. I will wait a few days for any comments or suggestions that you may have before I finalise it and send it off.
The Hon Angus Taylor MP
Minister for Industry, Energy and Emissions Reduction
I read the Government’s new document, “Australia’s Long-Term Emissions Reduction Plan” with interest, particularly the material on soil carbon. I note that the report envisages an important role for soil carbon sequestration in delivering Australia’s targets and that it predicts “landholders could earn around $400 million in additional revenue through the sale of accredited soil carbon sequestration in 2050”. I have some questions about the analysis of soil carbon that underpins the report. I hope you will be able to assist me with answers to these questions.
1. The main agricultural practices that result in increases in soil carbon also involve increases in livestock numbers, resulting in increased emissions of methane. Australian research has shown that, although switching from cropping to pasture can increase soil carbon, the net effect when increased methane emissions are accounted for is close to zero. (Meier et al. (2020) Simulated greenhouse gas emissions from cropped lands match those from permanent pastures after accounting for livestock emissions. Frontiers in Sustainable Food Systems 3, paper 121.) Has this been accounted for in the numbers presented in the Plan, both in the expected level of net sequestration and the predicted payments to farmers? What proportion of the benefits from increased soil carbon sequestration do you expect will be offset by increases in emissions of methane resulting from increased livestock numbers?
2. To the extent that soil carbon will be increased on cropping land, have the calculations allowed for the increase in emissions of nitrous oxide that would result? Higher soil carbon creates conditions that enhance the conversion of nitrogen fertilizer into nitrous oxide gas. (Palmer et al. (2017). Management practices likely to provide greenhouse gas abatement in grain farms in New South Wales, Australia. Crop and Pasture Science 68, 390–400.) Nitrous oxide has about 300 times the greenhouse gas effect as carbon dioxide, so a small increase in these emissions could offset the benefits of sequestered carbon.
3. The Plan highlights the Government’s target to reduce the cost of monitoring soil carbon to $3 per hectare. This seems extremely ambitious and its technical feasibility has been questioned by experts. What is the basis for believing that such an ambitious target could be achievable?
4. Dr Michael Crawford, CEO of the Cooperative Research Centre for High Performance Soils, recently observed that the cost of measuring soil carbon is less of an issue than the lack of reliable, adoptable, profitable methods for sequestering carbon in agricultural soils. What steps is the Government taking to invest in research and development to attempt to generate new methods for sequestering carbon in agricultural soils that are reliable, adoptable and profitable?
5. Farming practices that increase soil carbon sequestration generate sufficient private benefits for some (but not all) farmers to adopt them without payments. If these farmers receive payments for adopting these sequestering practices, such payments would contribute nothing to our sequestration targets, because the farmers would have adopted the practices anyway, without the payments (i.e., the sequestration is “non-additional”). The risks of non-additionality in the case of soil carbon are particularly acute because payments for soil carbon will be a small proportion of agricultural revenue. (Your report predicts that farmers will receive $400 million payments for soil carbon in 2050, but this is only 0.3% of the predicted $131 billion agricultural output.) This means that payments will be a decisive trigger for practice change in only a small minority of cases. Most farmers would either adopt the practices without a payment or decide not to adopt them even if a payment is offered. What steps is the Government planning to take to ensure that any payments to farmers for soil carbon are for adoption of practices that are additional to what they would have done without the payments?
6. Assessing additionality becomes increasingly difficult over time. Once a group of farmers has been in a program and received payment for say 20 years, determining what they would be doing without the payments is subject to enormous uncertainty. Additionality can change over time, depending on changes in markets, technology and climate. (Thamo, T. and Pannell, D.J. (2016). Challenges in developing effective policy for soil carbon sequestration: perspectives on additionality, leakage, and permanence, Climate Policy 16, 973–992.) What is the Government’s plan for assessing the additionality of soil carbon payments in the long term?
Thank you for your advice.
Professor of Agricultural and Resource Economics
University of Western Australia
39 thoughts on “356. Letter to Minister for Emissions Reduction”
Great article David. Perhaps we could have a poll to predict what response you are likely to get. Options could include:
A) No response
B) Thank you for your letter and we will consider the points you make (and do nothing)
C) Generic send of promotional material saying how good Australia’s approach is
D) Combination of B and C
E) Something else non-meaningful
F) Meaningful response addressing each of the points you make
G) Something else also meaningful
My bet is on C
A good effort but, frankly, I think this is much too long and technical for a minister to deal with helpfully.
Thanks John. Yes that’s true. Ministers never answer these letters. It will go to somebody in his department, or maybe get passed onto the Department of Agriculture, Water and Environment. I’m not expecting the Minister to engage. My more modest hope is to get people within his orbit aware of these issues.
Wonderful. Thanks for the opportunity to comment, Dave.
If you’re at all inclined, you could make the administrative point that these queries seem to fall within the ambit of the (legislated) Emissions Reductions Assurance Committee (see http://www.cleanenergyregulator.gov.au/ERF/method-development/emissions-reduction-assurance-committee#Offsets-Integrity-Standards). It seems altogether reasonable to ask for these matters to be specifically referred to the Committee. And if you wanted to add a little menace, it seems reasonable that an inadequate response would trigger administrative review.
Thanks Terry. Good advice. I’ll look into that.
This is a good start. I recommend that you confer with Robert White (Emeritus Prof. Soil Science, Uni. Melbourne) who thinks that the opportunity for farmers to earn credits is extremely limited (various recent articles are relevant). I hope you publish the response !
As for Anna’s poll, I go for C or B (which I suppose means D).
Thanks Rob. Yes, I will publish the response, as an addendum to this post.
As I’ve said many times before Dave, a pair of politics will beat a full house of science and economics every time.
Even so, it’s most worthwhile asking those questions of the government.
One of the ironies that strikes me in all this is the Regenerative Farming crew, for whom increasing soil carbon by changing practices is a big deal, and touted as both a profitable and environmentally responsible thing to do. But if that is also increasing stocking rates and methane & NO2 emissions….
Yes. We can remind (or inform) everyone that, on average, in terms of “greenhouse effect” or “global warming potential” (GWP)
– 1 kg of methane (CH4) = 25 kg of CO2
– 1 kg of nitrous oxide (NO2) = 300 kg of CO2
though how long their “half-life” persistence in the atmosphere also matters (measured in decades or centuries).
This is why it makes more sense to measure GHG emissions in terms of “CO2-equivalents”, which include gases like methane and nitrous oxide, and allow a more accurate picture than just quantities of CO2.
Other gases like CFCs, CHFs, etc. although emitted in smaller quantities, have much greater GWP values:
– 1 kg of CFC-11 (CCl3F) = 4,750 kg of CO2
– 1 kg of SF6 (Sulfur Hexafluoride) = 22,800 kg of CO2
For more info see e.g.
+ Tony’s reminder below that in soils:
For each ton of C as humus, you will have 80 kg of N, 20 of P and 14 of S, a fertiliser opportunity cost of >AUD 100/ton C.
Good to see some figures, thanks Steve. But you don’t mention the CO2 GWP of water – as gas or vapour. There’s a lot of it up there, so I’m wondering how it compares, in case anyone happens to know.
Good letter David.
But echoing the sentiments of Anna’s post I think you are wasting your time writing to the Minister. I also reckon you will get a C response as in “Ta very much, here’s a copy of the Plan and what’s more look at all this extra lovely colouful bumf. Then something about technology not taxes plus spin.spin and more spin.”
One reason for that sort of generic response these days is that the hollowed out public service just does not have the time to do better and anyway Morrison has told the pubic service to “Shut up and do what you’re told”..
I assume you are mot just letting off justifiable steam and want to have an impact.
In that case my advice is to recast the letter as a newspaper article and offer it to the AFR . I would keep the questions to be answered format but If I were the editor I would want you to change the lead in a bit and add a “bottom line” conclusion. As it stands your letter with all the greetings etc runs to 752 words [according to Word] so it is absolutely the right length for a newspaper opinion piece. Add a head shot of yourself and a picture of grazing cattle or something in case the AFR wants to illustrate the piece and Bob should be your uncle
I would send the letter to the Minster anyway but my observation is that unless you are inside the policy tent the best way to get some response from politicians and bureaucrats is to publicly embarrass them. And in my opinion the COALition Government needs to be very seriously embarrassed on the matter of its climate policies.
Finally, if you do craft an opinion article on this and it is published would you please let me know as I don’t normally see the AFR.
Thanks Henry. Good advice.
Additionality is clearly covered!!!!!!!
… have hit subparagraph 27(4A)(a)(ii) of Division 3 you know all is lost….
As detailed in the: Carbon Credits (Carbon Farming Initiative— Measurement of Soil Carbon Sequestration in Agricultural Systems) Methodology Determination 2018
21 Newness requirement
For subparagraph 27(4A)(a)(ii) of the Act, a requirement in lieu of the newness requirement for a soil carbon project is that the project complies with subparagraph 27(4A)(a)(i) of the Act, disregarding the preparation of any land management strategy before the eligible management activity commences.
More substantially, I wonder how reversal events to be treated?
I haven’t succeeded in finding that yet. Lost indeed. But from the way that is worded it sounds like they are still relying on a before-vs-after comparison. If farmers weren’t already doing the practice, or doing much of it, then it is judged to be additional. That’s a completely hopeless way of assessing additionality. Everything would pass that test when its new, even if it generates massive private benefits. The worry is that there is no mechanism to stop paying them once it is clearly not additional. And how do we know what is additional if everybody is doing it because they are being paid to do it?
Additionality is really important, but I think it’s pretty much impossible to have a reliable test of it at reasonable cost.
There is a list of eligible activities, that a farmer can adopt that are “new” to the project area. ACCU’s are issued when a project shows an increase in C. Some of the soil C measurement protocols are very robust and are useful in a general farm management sense. As for the expense of measurement, if the cea is 1000 ha and measurement is $15k every 5 years, that is pretty cheap on an annual basis. As sensing gets more reliable cost will reduce.
100% Agreed. I think i saw an NBER paper on this more generally with environmental policy. If i can find it I will send to you directly. It could also have been a job market paper. Give me until the weekend to go searching.
Great letter, you may like to observe that
1) The program should include a requirement for any resultant increase in soil carbon to be maintained in perpetuity and require the owner of the land to offset any subsequent decline in the stock of soil carbon.
2) Careful consideration be given to the fact that by including soil carbon in the world’s greenhouse gas accounting system, Australia may become liable for any net change in this carbon stock and, if it gets dryer, this may prove to be very expensive for Australia as we search desperately for ways to maintain a declining stock. (One needs to careful when making any you end up sleeping in.)
This would be best published as an open letter to the Minister in the various agricultural journals that farmers read. The Land, the Stock Journal, etc.
David, looks challenging but I wont comment on the chances of a response. But I would like to add that soil C sequestration carries another cost, namely the N, P and S locked up with the C. For each ton of C as humus, you will have 80 kg of N, 20 of P and 14 of S, a fertiliser opportunity cost of >AUD 100/tC ! Some good work behind this is Kirkby et al (2011), but the best reference on this and related fields is probably White et al (2021) in the Aust Farm Inst Occasional papers this year. White’s coauthor, Richard Eckhart of Uni Melb is probably one of the best informed scientists on agriculture and GHGs. I can also comment on two of the challenges you mention. One is ruminant methane: there is no doubt the brown algal supplement supresses this 80+% in cows, giving better productivity as well. The challenge is getting a system working for100% grazing ruminants: the cobalt bullet story of the 1950s comes to mind. The second is biological nitrification inhibition, the fac that some plants through root exudates supress nitrification and in turn N2O production very substantially ( see OSullivan et al 2021). The trait is now in wheat and canola. These two areas are targeting the biggest two contributions of agriculture to GHGs, methane and N2O , but will we undertake the crash R, D and E program needed to make them work ? No sign of that at the moment. I will email the relevant references, but I dont have White et al (2021) in e form, and that’s the key reference.
Thanks Tony. I decided not to emphasise that soil C is unlikely to be beneficial for most farmers (which is where I’d sit this point), but I may reconsider that.
I did cover that issue in my posts earlier this year, starting with this one: https://www.pannelldiscussions.net/2021/04/346-soil-carbon-1/
I think this is a good letter, quite tactful in using questions to get to the guts of false promise rather than telling the Minister straight up. As I’m betting on Anna’s B, I think Terry’s advice of getting this before the ERAC is an excellent option if you can pull it off. Perhaps a joint effort with Michael Crawford?
Which brings me to the letter itself. As I understand soil carbon, the ability to increase it under any management practice, now or in the future, is constrained biophysically by temperature and moisture. I suggest that point is made in #4. As it stands that paragraph implies that new methods will deliver in an open-ended way, playing into the ‘technology not taxes’ mindset. A reality check here would help.
Thanks Kevin. I wasn’t aware of ERAC before. That does look like a potential opportunity.
Visit CER site and give yourself a tutorial. Lots of basic and useful info on how the system works, including discounts on soil C measurement, a key ERAC safeguard.
You need to add soil clay fraction as well. Generally, the lower the clay fraction, the less C can be held. Timing of rainfall also matters. Of course many of our cropping farms are in fact running down their soil C levels, according to standard soil tests. !!
I agree an opinion piece in the AFR would be good.
The letter could also cc to the shadow minister and The Greens.
The questions might then make “question time”.
I think it would be better to reward all sequestration rather than be concerned
“…….that any payments to farmers for soil carbon are for adoption of practices that are additional to what they would have done without the payments.”
Likewise emitters should pay for emissions.
The truth is:
all the costs of the Emission Reduction Fund come from tax
complex administration and perverse rules minimise the fraction of those cost actually incentivising sequestration and emission reduction
It’s true that additionality can be a bit of a fraught issue, but in this case, my concern is that almost none of the extra carbon they pay for will be additional. That means it is just a transfer of money from taxpayers like me to farmers. (Obviously, that’s part of the appeal to the National Party.)
David, I always worry about the permanence of increased soil carbon in farming systems. A farmer may be able to increase soil C for a few seasons but what happens when the management or values change? Does the government proposal require return of any ACCUs issued in the event that soil C declines?
Yep. Good questions.
Projects have a minimum life of 25 years.
Thank you David. Now is not the time to stand on the side lines. Holding the Minister to account for policy failure is critical at this point in time. I like the suggestion by Henry of an article for the AFR because more readers are now interested in climate policy and there’s a need to shift the policies of both major parties. An open letter in agricultural journals as suggested by Michael would likely add to the pressure for change by encouraging some rural electors to add their voices to the cause.
Hi David The letter looks good. I like to focus the high interest on soil carbon on improving nitrogen use efficiently. New technology is becoming available to map soil carbon variability which has the potential to reduce the cost, for example Veris Technologies Iscan+. Maintaining or increasing soil carbon is a very important sustainability issue and knowing rate of change in soil carbon is very valuable data for growers, especially in the cropping zones. Also, increase knowledge on soil carbon variability and how the information can be used to develop variable N rate maps is not currently available to growers.
In terms of impact, i agree that a piece in AFR would possibly have more impact. But the AFR piece could be written as the letter, with an intro. The Commonwealth Government is lagging business, and I do think the people that read Australia’s most expensive newspaper would appreciate your view.
Thanks David for taking the time to write this letter and allowing time for feedback. Your points are all valid and I hope you get a response. I wonder if you might offer a small concession to get the reader onside — potential for gains on highly degraded soils? And then, a counter argument, at risk of making it longer but here’s a chance to lay it all out — if payments for soil diversity are to be counted in upfront biodiversity payments, what assurances do we (society) have that these payments are justified?
Thanks for putting this together. However, I think it would have more impact if these were not a series of questions (the answers to which are known by many scientists and economists already), but a series a critical points showing that the government policy is flawed. The figures that the Minister took to Glasgow were largely put together by Matthew Warnken of Agriprove, who has a large vested interest in getting as many farmers enrolled in soil carbon farming as possible. However, there have been many scientific articles pointing out the lack of reality for some of the projections about the future number of projects and future earnings. With regard to the suggestion that more R and D is required to develop methods, the government will reply that it has already allocated considerable sums. Is there going to be a miraculous breakthrough – in implementing supplement feeding of grazing animals to suppress methane emissions perhaps. Besides, it is not more R and D on soils or agronomy that is required, but thorough economic analysis of the financial feasibility of the many methods that are already well known. This is what is of most concern for farmers contemplating their options.
Q1. Agreed – Generally there is not sufficient increase in soil carbon under the pasture to offset the extra CO2-e due to methane emissions for the grazing animals and the operation of the livestock business.
Q2. Agreed – generally an increase in N fertilizer increases emissions of nitrous oxide from croplands.
Q3. Agreed – rapid sensing techniques have been developed but they need to be calibrated for each project against soil carbon measurements. Soil cores still need to be taken to allow this to be done as well as to measure soil bulk density and gravel content. Models can be used, but these also require to be validated against soil carbon measurements. The overall cost of sampling and measurement is unlikely to fall below $30 per ha.
Q4. – A number of successful farmers have been employing methods to build up soil carbon as part of good business practice. This enables them in many cases to be audited and claim carbon neutrality, which is a benefit in marketing their products. They do not need to participate in the ERF to achieve this.
Q5. The question you ask here is largely hypothetical, but it does raise the issue of the opportunity cost involved in a practice change, especially from cropping to livestock. As we show in our Occasional paper this year in the Farm Policy Journal (mentioned by one of your correspondents), the opportunity cost for changing from cropping to livestock is generally large and far exceeds any likely income from carbon credits, irrespective of the value of those credits.
Q6. This illustrates why the final question in 5. is hypothetical. However, a farmer with a registered project undertakes to maintain that practice for a minimum of 25 years (unless some extreme event intervenes). Otherwise, if they stop the practice before the full term they may be required to forfeit the credits earned.
Great summary Robert. It reminds me of the farm forestry/native vegetation lockup approach to carbon sequestration. Too many rules, too much uncertainty, too much opportunity cost etc. Consequently, uptake by farmers is insufficient to make a real difference.
There were a number of schemes floating about, some uptake of vegetation lockup, a little farm forestry though timber production & stock shelter were a bigger driver than carbon. Would be good to know the scale of all that and where they are all at now in terms of contributing to our targets?
David, it’s been a very interesting discussion! Here are three more points:
1. I expect in the case of regenerative agriculture (as opposed to land use change proposals) that there are some opportunities for net sequestration benefits over time. This does not mean that there are not some offsetting emissions (e.g. higher methane emissions from grazing systems). But regenerative agriculture does not always involve intensification, and methane emissions are complicated – stock are more efficient in converting feed in better quality pastures so methane emissions might fall per unit of input.
2. The debate about additionality might be better framed as a co-benefits problem. Regenerative agriculture will probably deliver both increased productivity and increased sequestration, but it is very difficult to trigger the point at which returns from one or the other will trigger landholder change. But change will occur faster if both can apply. This is where the additionality rules are not sensible. Economists have designed ways around this problem – procurement auctions at the landholder level would better tailor pricing to the marginal change required.
3. I think you have identified some key weaknesses in the carbon sequestration rules. But I wonder here if the theory of the third best rule should also be considered – perhaps carbon sequestration is one of the least worst options and that is why you won’t get much response from the politicians (they know what corners are being cut elsewhere). At a broader level, I think it might be worth identifying some key principles for designing schemes when information is scant but targets for outcomes have already been set.
Personally, I find the idea that CO2, present at a mere 0.03% by volume in the atmosphere, and rising (granted), is the critical governing factor for global climate is fantastic. More credible would be a hypothesis that the world is being warmed directly by the heat produced from the burning of carbon fuels. The distinction is significant in the context of your letter, David, because, if true, the carbon burning hypothesis would mean that release of unburned methane and nitrous oxides from livestock and soils would have trivial greenhouse warming effects. Of course, there are other hypotheses to explain a change in climate, for example those concerned with better water retention by good soil management which, as you have said, is assisted by increased livestock numbers, and those concerned with plant cover which cools the land by shading and transpiration, assisted by conservation of forests. And we should not overlook the fact that CO2 is an essential food for plants – in that respect it is a governing factor for gloabl well-being, the more the better. The current hype over CO2 purely as a greenhouse gas is a magnet for many well-meaning people but it could be seriously misdirecting many of our land, agricultural and industrial management policies. We need to prepare for a warmer world if that is a trustworthy prediction, not to try to prevent it. The situation is much too complicated, both scientifically and politically, to try to manage all of the interacting factors.
Thanks everybody for all the comments, advice and suggestions. I have a lot to think about.
The AFR article is a good idea – but you could write to the Minister/spokesman from each of the major parties seeking their response to the questions, and potentially use a summary of the responses for the article?
Its a really informative letter for an interested lay audience – clarifies some myths very nicely.
An update. This post led to lots of communications and evolution of ideas about how to progress this issue. I teamed up with Michael Crawford from the Soil CRC and we have written an article for the Farm Policy Journal. The issue has been delayed but will come out in early May (2022). When it does, I’ll publish the article here and send it to the Minister with a cover letter and a couple of key questions. I’ll be giving a public lecture (online) based on the paper on May 20. I’ll advertise that in a Pannell Discussion when the details are set.