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Thursday, 3 November 2011
Page: 8236

Senator MILNE (Tasmania—Deputy Leader of the Australian Greens) (19:13): Over a long period of time, Senator Heffernan and I have had a series of discussions about this issue, about the credibility of tree plantings and the like. We share a common abhorrence of managed investment schemes. I know that Senator Heffernan will be pleased to know that we have managed investment schemes on the negative list as far as the Carbon Farming Initiative is concerned, so that they cannot have credits.

Senator Heffernan asked about where in the world would an Australian entity—let us assume a polluting, coal fired power station, for example—would trade after 2015. When we go to flexible trading, this scenario may occur where a liable entity may purchase 50 per cent of its liability with overseas permits. The issue here is that, recognising that the market is immature, recognising that many countries have varying degrees of rigour as to how they would assess and accredit such a thing, we have specifically said that not only is there a quantitative limit to the amount of permits they can be bought overseas—as in 50 per cent—but there is also a qualitative limit. That means that there will be rules put in such that one cannot purchase anything that does not meet a high standard, like the gold standard, in these markets. So you may have some companies or countries making available credits on the international market that would not be acceptable to be purchased into our scheme if they do not meet that high standard. That goes to the issue of rigour that you are talking about.

As to your second question, about the property south of Alice Springs, in relation to RM Williams and so on, the issue there is that there has to be a methodology that is developed and accepted before credits can be generated. My understanding of how this will work is that, for any particular activity for which you wish to generate carbon credits—like protecting native vegetation or enhancing carbon in the landscape or whatever—before the amount of credits you may be able to sell into a compliance market can be calculated, you have to go through the process of getting the methodology accredited. That is what we are going through. There have been very few methodologies accredited to date. One that has been accredited is savanna burning, and I am very pleased to say that that is occurring, because that will lead to good outcomes for Indigenous communities in the short term and we will see permanent employment and real benefits flowing into Indigenous communities because of that. We did hear on the news at one point that camel culling had already been accredited. In fact, it had not. A proposition had been put forward to accredit camel culling. There were lots of problems found with that, and that is the point of establishing an assessment—so that this can actually happen. So, in answer to your question, there has to be a methodology developed in order to do this.