Single-desk carbon trade could earn billions: Flannery

Sydney Morning Herald
Friday 31/7/2009 Page: 5

THE former Australian of the year Tim Flannery has proposed a single Australian Government trading desk - similar to the former wheat desk - to sell carbon credits to the United States. The government-operated desk could ensure Australia up to 10% of the 1 billion tonnes of carbon offsets the US would buy offshore a year if legislation to establish a US emissions trading scheme passes the US Senate later this year, he said.

Mr Flannery backed the Coalition's proposed amendment to the Government's emissions trading scheme which would allow carbon credits to be created by farmers who store carbon in their soil. He said these would be the primary carbon credits sold to the US through his proposed trading desk.

Green carbon, such as biochar - a type of processed charcoal used to store carbon in soil - is not included in the Australian emissions trading scheme or any international agreements. Under the Government's proposed emissions trading scheme, Australian carbon credits can only be generated through revegetation of trees to avoid deforestation.

"The Government could then buy a certain amount of permits from farmers for carbon soil storage.., at, say, $15 a tonne and sell them on to the US at $20 through the desk," Mr Flannery said. "If we could get 10% of the US market at, say, $20 that would be about $2 billion a year coming into Australia and [would] help Australian farmers expand carbon storage projects."

Under the single-desk plan, government assessors would be sent to evaluate carbon storage to ensure they were legitimate projects before the Government could sell them. Mr Flannery's proposal would require Australia to lift a temporary ban on selling carbon credits internationally - except to New Zealand - currently included in the emissions trading legislation before Parliament, and require green carbon's inclusion in an international climate change agreement.

Mr Flannery recently returned from New Zealand where he proposed a similar idea to the country's climate minister. On Wednesday the Agriculture Minister, Tony Burke, cast doubt on the likelihood of biochar and other soil-based carbon storage being used to create permits in an Australian scheme.

Malcolm Turnbull, the Opposition Leader, said yesterday the Opposition would vote down the Government's emissions trading scheme when it came to the vote in the Senate next month unless the Government accepted nine broad changes to the policy outlined last week, including the inclusion of biochar.

But speaking to the Herald yesterday Mr Flannery hit out at the Liberal Party, saying the "rump" of climate sceptics in the party were marching it to electoral defeat based on a flawed climatechange policy. "That is just stupid and they need to move on... Malcolm is trying to move them on, though not as effectively as we would like to see," Mr Flannery said. "How stupid could you be? They will lose at least 20 seats if there is a double-dissolution election."