IN THE sporting phrase, the Coalition plan has soil carbon peaking too early.
By making soil carbon a foundation stone of its policy, and a commodity that all Australian taxpayers will be investing in whether they like it or not, the Coalition has invited rigorous scrutiny of the issue.
I’m not sure that soil carbon is ready for that scrutiny.
Taxpayer-funded soil carbon trading is a concept that needs some massaging and makeup before it is shoved into the glare of prime-time TV, and the demolition job that will now result.
That’s regrettable, because the ideal of tradeable soil carbon is something worth working on.
As a big picture concept, soil carbon is brilliant: improve farm soil and save the world.
Such crusty organisations as the United Nations agree that soil carbon is a possible panacea for many of the world’s ills, from climate change to food and water scarcity.
Dedicated individuals have shown that it is real; that soil carbon levels can be lifted, sometimes substantially, in many soils under many farming enterprises.
The Chicago Climate Exchange (CCX) has demonstrated that the market will pay for soil carbon credits—albeit not much under the CCX model.
But while many can see the pot of gold at the end of the rainbow, the route to it remains hazy.
It’s one thing for a farmer to build soil carbon: it’s another to have all the nation’s farmers building soil carbon and have them each interface with an accounting system that will give them credit for their efforts.
As has been tirelessly pointed out, soil carbon levels differ from soil to soil, farm to farm, paddock to paddock, season to season. Seen as a whole, the nation’s soil carbon is a complex and ever-changing picture.
What do you measure, and when, and how? And what happens when the carbon disappears in drought or fire?
These are questions that tax intelligence and science, but there is a process that will help work through them.
A carbon market
Given a framework to operate in, a market will decide how much risk it is prepared to take on, the level of accountability it needs to support that risk, and pay accordingly.
A market also provides a learn-as-you-go environment. Initially, like most free enterprise, a soil carbon market is likely to have its share of shonks and cowboys on both sides of the fence. But the more money poured into the market, the more rigour will be demanded of it. Farmers, traders and buyers have the ability to adapt to each incremental tightening of the trading framework.
The Coalition has now plunked soil carbon blinking into the spotlight, and there’s not a free market in sight.
In fact, there is very little in sight in the two lines that the Coalition dedicated to soil carbon in its press release, except for this statement: “The Coalition will use the Emissions Reduction Fund to deliver about 85 million tonnes per annum of CO2 abatement through soil carbons by 2020 with an initial purchase of 10 million tonnes of abatement through soil carbons by 2012-13”.
(The Emissions Reduction Fund is a government body, kick-started with government/taxpayer funds. Businesses that push their emissions above a “business-as-usual” level pay the Fund a penalty; businesses that go below business-as-usual emissions get rewarded from the same fund.)
Which suggests that the plan is for you and me, the taxpayer, to pay you, the farmer, for sequestering carbon.
There is no provision for a market to provide a learn-as-we-go environment: instead, we will have government laying down legislation and a bureacracy attempting to govern an unreliable and messy commodity.
Government dabbling in areas that are the natural realm of private enterprise has always ended in tears.
Soil carbon promises tears for anyone who tries to harness it, public or private, but the private sector doesn’t mind a few knocks. Especially if they are being delivered to someone else.
In the meantime, the Coalition’s plan for us all to share in the ownership of the nation’s rebuilding of soil carbon will see a long queue of critics lining up to point out flaws in the soil carbon concept.
Yes, we are shy of a few answers, but that doesn’t mean that the idea of tradeable soil carbon is wrong. It’s all in the execution.
Better that we hand it over to the free market cowboys who will tinker with it, soup it up, prang it—and in the end, make it work, if it’s workable.
Only then should the Coalition consider making it part of the national interest; but by then it won’t matter.
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