Workshop Manual: The business case for carbon farming: improving your farm’s sustainability (January 2021)

5.2 Examples of approved methodologies

Learning from existing methodologies

The business case for carbon farming: improving your farm’s sustainability

Explore the full Workshop Manual: The business case for carbon farming: improving your farm’s sustainability (January 2021)

 
The currently approved methodologies, even where they are not directly relevant to particular farming enterprises, show what is required in a methodology for it to be approved by the Minister for the Environment.
Case study methodologies also provide a solid indication of the rigour with which carbon farming activities under the ERF need to be undertaken. This has important implications for costs.
Table 5.2 summarises the key features of 6 selected methodologies.
These are discussed below, and further details of each are in Appendix A. More detailed information on each of these (along with full lists of current methodologies) can be found at the Clean Energy Regulator website (links are provided below).
Some of the methodologies discussed below are sequestration methodologies. Determining the suitability of sequestration methodologies for your particular circumstances can involve some complex considerations.
The Clean Energy Regulator has recently published a decision tree to assist in working through the suitability of particular sequestration methodologies. 
 
  Table 5.2: Summary of selected ERF methodologies in agriculture
 Method
Scope
Timeframe
Emissions targeted
Baseline 
Calculation
More information
 
Defines the activtities under the methodology
Timing guidelines and the crediting period a project can apply to claim ACCUs
Defines the sources of emissions or savings covered by the methodology
Initial information required to evaluate the baseline case
The type of calculations or models used for calculating emissions 
Visit the CER page for this method
Animal effluent management
For piggeries and dairies to develop new facilities for the treatment of animal effluent by emissions destruction, emissions avoidance or both
Projects that generate electricity can have up to a 7-year (84 month) crediting period. Projects that do not generate electricity, including projects that flare only, have a 12-year crediting period
Organic effluent that would normally be treated in an anaerobic pond. Eligible material must be produced by either an eligible animal facility or a facility that produces a particular type or types of material as a waste stream.
The treatment can reasonably be expected to result in fewer emissions than if the effluent were treated in an anaerobic pond. 
The amount of emissions destroyed or avoided, then subtracting emissions from ineligible material and project emissions, such as from the use of fuel or electricity.
Link
Beef cattle herd management
Reduces the emissions intensity of beef cattle production by reducing cattle emissions per kilogram of liveweight produced
Seven years. It is recommended that the participant select a crediting period start date that is later than the declaration date of the project.
Improving cattle productivity, reducing the average age of a herd, reducing the proportion of unproductive animals in the herd or changing the number of animals in each livestock class in the herd.
Each herd must have historical emissions intensity data from the project's reference period, with the emissions intensity reference period calculated using three of the immediate past seven years
The difference between the herds' historical baseline emissions (minus four per cent) and the herds' emissions following implementation of project activities
Link
Estimating sequestration of carbon in soil using default values
Specific project management activities on eligible land that aim to remove carbon from the atmosphere by increasing the amount of carbon added to the soil
Twenty-five years
Removing carbon from the atmosphere and storing it in the soil by setting up project management activities that change agricultural soil conditions to improve crop and pasture growth
The baseline emissions period is five years before the project starts, representing the level of emissions that would have been produced if your project did not go ahead
Modelled using the  Sequestration Value Maps, with calculations based on default values, instead of measured values. The default values have already been modelled by FullCAM
Link
Reducing greenhouse gas emissions by feeding dietary additives to milking cows
Increasing the fat content of a milking cow's diet reduces methane emissions produced as a result of enteric fermentation, done via feeding the following eligible additives to milking cows: canola meal; cold-pressed canola meal; brewers grain; hominy meal; or dried distillers grain.
Seven years 
Improving feed quality for milking cows in this way means the animals can use energy from the feed more efficiently while enabling faster feed passage through the rumen, reducing the amount of enteric methane released
Baseline emissions are established by using data from three consecutive years in the seven years prior to the commencement of the project
The net abatement amount for each milking herd for each project year is calculated by entering data into the Dietary Fats Calculator which is available on the Department of Environment and Energy's website
Link
Measurement of soil carbon sequestration in agricultural systems
 Credits measured increases in soil carbon as a result of one or more new or materially different management activities in grazing or cropping land (including woody horticulture) that store carbon in that land. 
The project must be maintained for a nominated period of either 100 or 25 years. Proponents can generally nominate the intervals of their reporting periods from one year to a maximum of five years
Corresponds to the increase in soil carbon over time, after the emissions caused by additional activities used to build soil carbon (for example extra fertiliser applications beyond the baseline) have been subtracted
Each crediting application requires at least one round of soil sampling, the calculation of net carbon abatement and inclusion of this and other required information in an offset report
Soil carbon stocks must be estimated using specified soil sampling methods and samples must be measured for soil carbon content using specified laboratory techniques or calibrated in-field sensors.
Link
Reforestation and afforestation V2.0
Involves planting forest trees in agricultural areas
Twenty-five years
This method helps to reduce the amount of greenhouse gas entering the atmosphere, as carbon remains stored in the trees while they grow
A permanent planting on land that has been grazed, cropped, or allowed to lie fallow (between grazing and cropping) for at least five years before you apply to run a project. The land must not be cleared native forest and must also be able to support the growth of new forest
The carbon stored by the project is calculated by directly measuring trees in sample plots using infield measurements, such as full inventory and permanent sample plot assessment.
Link
Avoided clearing of native regrowth method
Protection of native forest areas for which clearing consent has previously been issued
Twenty-five years
Emissions from fuel use and fires. Carbon stocks in live and dead biomass
The baseline scenario involves modelling regeneration, clearing, and windrow and burn fires over a 100-year period. The project scenario is also a series of modelled events, which are only modelled as they occur
The difference between two scenarios is the amount of additional carbon stored as a result of your project. The net amount of abatement for the reporting period is then determined by subtracting any emissions due to fires from the total change in carbon stock.
Link
Human-induced regeneration of a permanent even-aged native forest
Enabling native vegetation to regenerate
Twenty-five years
Emissions from fuel use and fires. Carbon stocks in live and dead biomass
The project area must not have any forest cover during the 10 year baseline period. The baseline period is determined by the date land was included in the project
Net abatement for each reporting period is calculated as the change in the amount of carbon stored in all carbon estimation areas, minus the emissions resulting from fire and fuel used in the process of establishing and maintaining the project.
Link

 

Additional considerations covering more general aspects of these approaches is provided below.
 

5.2.1 Sequestering carbon in soils in grazing systems

This approach sets out requirements for undertaking a soil carbon project within grazing systems. The methodology is technically complex, particularly as it is based on samples (or direct measurements): the increase in soil carbon that results from the project is measured through an approved sampling and soil testing approach.
Specialist and technical assistance will be needed to use this methodology in a project. Some particular cost aspects of the methodology are considered in Chapter 9.
 

5.2.2 Avoided emissions: animal waste

For emissions avoidance projects that relate to the treatment of waste from piggeries and cattle operations, the ‘business as usual' scenario sees methane emitted as waste products break down.
Applying these methodologies will reduce the amount of methane entering the atmosphere, as the technology essentially involves burning the methane and in some cases using the resulting energy to generate electricity. In each of these cases, the underlying technology is well established (for example, methane captured from animal waste is a common source of energy in villages in some developing countries).
The monitoring and measurement requirements for these methodologies are substantial. To ensure that the abatement is genuine, they involve continual monitoring of several aspects of daily operations as well as the use of scientifically based calculators to estimate avoided emissions.
For example, continuous monitoring is required to account for any breakdowns that occur during the project, as emissions are not avoided while the equipment is not working.

 

5.2.3 Avoided emissions: enteric fermentation in dairy cows

The "reducing greenhouse gas emissions by feeding dietary additives to milking cows" methodology is designed to reduce emissions from enteric (intestinal) fermentation, which in total is the major source of agricultural emissions.
Rather than involving a physical technology as in the methodologies for dairy waste, it involves a dietary intervention to alter the digestion of dairy cows in order to reduce emissions from enteric fermentation.
It has been understood for many years that methane is produced during digestion in ruminants and that dietary composition affects the amount of methane produced through enteric fermentation. Increasing the fat content of a milking cow's diet reduces methane emissions produced as a result of enteric fermentation.
Based on current scientific understanding, this methodology effectively sets out a dietary regime that will lead to lower emissions per animal. The extent of emissions reduction depends on the feed additives given to milking cows that are otherwise mostly grazed on pasture.
The amount of abatement is calculated using a scientific model that uses feed intake as its major input. This methodology requires ongoing measurement of feed inputs, milk production and the number of cows.

 

5.2.4 Sequestration from vegetation plantings

These methodologies involve the sequestration of greenhouse gases through a number of different tree-planting configurations. Sequestration in vegetation can be achieved in a number of ways, including:
  • through avoiding the deforestation of native forest areas
  • through permanent environmental plantings
  • through reforestation and afforestation of cropping and grazing land
  • through permanent plantings of specific species (mallee, for example)
  • through assisted regeneration of native forest.
None of the forests established under these methodologies can be harvested for commercial purposes. As in the other types of methodologies, some of the sequestration methodologies require careful measurement and recording of all aspects of forest growth and development.
The measurements are used in combination with known relationships to estimate the amount of sequestration. For other sequestration methodologies, measurement is based on the use of modelling tools, including:
  • the Reforestation Abatement Calculator
  • the CFI Mapping Tool
  • the CFI Reforestation Modelling Tool
  • the Full Carbon Accounting Model (FullCAM).
Some of these tools are available for download here, while others can be found at the individual methodology links in the table above. Importantly, these methodologies also include approaches to deal with fire and other disturbances to the sequestration process.

Explore the full Workshop Manual: The business case for carbon farming: improving your farm’s sustainability (January 2021)

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RESEARCH REPORTS

1. Introduction: background to the business case

This chapter lays out the basic background and groundwork of the manual

RESEARCH REPORTS

1.1 Overview

Introduction: background to the business case

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1.2 Being clear about the reasons for participating

Introduction: background to the business case

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1.3 Key steps in a decision process

Introduction: background to the business case

RESEARCH REPORTS

1.4 Working through the business case for carbon farming

Introduction: background to the business case

RESEARCH REPORTS

1.5 Factors determining project economics

Introduction: background to the business case

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1.6 Elements of the business case

Introduction: background to the business case

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1.7 Building an economic case

Introduction: background to the business case

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1.8 Important features of the business case

Introduction: background to the business case

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1.9 The plan of this manual

Introduction: background to the business case

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2. How carbon is farmed under the ERF

This chapter considers in detail the activities that constitute carbon farming

RESEARCH REPORTS

2.1 The scope of carbon farming under the ERF

How carbon is farmed under the ERF

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2.2 Emissions avoidance activities

How carbon is farmed under the ERF

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2.3 Sequestration activities

How carbon is farmed under the ERF

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2.4 The negative list

How carbon is farmed under the ERF

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2.5 Carbon farming under the Emissions Reduction Fund

How carbon is farmed under the ERF

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2.6 Who's who in the CFI and the ERF

How carbon is farmed under the ERF

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3. The policy context and the price of ACCUs

This chapter takes a broad look at the policy context for carbon farming

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3.1 The policy context

The policy context and the price of ACCUs

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3.2 A documented climate challenge…

The policy context and the price of ACCUs

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3.3 … with numerous policy responses

The policy context and the price of ACCUs

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