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Climate Solutions Fund must help farmers adapt to change, more work needed on natural capital value

25 February 2019

The National Farmers' Federation says the Government's proposed Climate Solutions Package contains a number of measures that must help support agriculture to reach its potential.

"Reducing emissions and being valued for our land stewardship are key parts of the NFF's plan for the farm sector to reach $100 billion by 2030 - up from $60 billion today," NFF CEO Tony Mahar said.

In particular, Mr Mahar welcomed a $2 billion increased investment in the Climate Solutions Fund (formerly the Emissions Reduction Fund) over 10 years from 2020, adding to the current residual funding of $226 million.

"The extension of the ERF support until 2030 will allow farmers and small businesses the opportunity to improve the environment and benefit from new revenue opportunities.

"The current ERF has over two thirds of its projects in the farm sector: 666 of 908.

"This represents contracted carbon abatement of 157 million tonnes by the farm sector of a total of 193 million tonnes. The new fund should be expected to support at least that proportional scale of engagement creating more opportunities for positive participation by farmers in the carbon market.

Since its inception, the ERF has provided a range of opportunities for the farm sector to contribute to emissions reduction in an economic and transparent way.

"Climate change is a key issue for farmers. Adaptation and participation in maturing markets are vital for farm income diversity.

"For example, through methods outlined in the Carbon Farming Initiative, farmers in south west Queensland and western NSW have demonstrated the benefits of diversifying their income by engaging in re-vegetation and avoiding deforestation methodologies.

"In the Northern Territory, savanna burning, a method also introduced by the CFI, has proven to be both financially and environmentally rewarding. Since December 2018 about 13.6 million tonnes of carbon has been sequestered through savanna burning.

Mr Mahar said emissions reduction and carbon offsets must be balanced with the need to feed and clothe a rapidly growing global population. He said the Climate Solutions Fund opened the door for more innovative approaches to offsets.

"Of the 40 CFI methodologies, 23 are agriculture specific. Unfortunately, many of them have very low uptake: they are in need of refining and/or better promotion.

"The NFF sees potential for a redrafting of the CFI's soil methodology; changes to pasture quality parameters; finalising the review of rainfall triggers in plantation forestry and farm forestry methodologies; and including innovative approaches to methane management in livestock operations.

"All of these need more consideration and investment."

Mr Mahar welcomed the Government's commitment to investing in firming technology to support the transition to renewables. Firming technology is required to store and guarantee supply from renewable power sources when energy isn't being generated."

"Snowy 2.0, Tasmania's Battery of the Nation and the 1200 MW Marinus link will be important storage technologies to ensure a transition to renewables can support the economy's electricity needs.

"The NFF urges policy makers ensure a well planned and efficient transition to avoid a repeat of gold plating of transmission assets," Mr Mahar said.

The proposed National Electric Vehicle Strategy is also of interest to agriculture.

"This may be an opportunity for the farm sector when coupled with regional or off grid generation. More discussion on the opportunities and limitations of this technology is welcomed."

Mr Mahar said it was disappointing the Government did not commit to the establishment of an Ecosystem Services Fund to facilitate the development of market-based instruments to value biophysical assets, often referred to as natural capital.

"This is something we'd like to see included in further iterations of the Government's climate policy and to be committed to by the Opposition."

"The Ecosystem Services Fund is an important policy for the farm sector to allow it to maximise its investment in natural capital."

"The NFF urges close attention to this important policy area and its role in assisting Australian agriculture to reach $100 billion in farm gate output by 2030," Mr Mahar said.

Media Enquiries: Laureta Wallace
P: 0408 448 250
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