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AUSTRALIAN SOILS AND CLIMATE CHANGE ECONOMICS

The Carbon Coalition Against Global Warming

FINAL SUBMISSION

to the Australian Government Garnaut Climate Change Review

21 January, 2008

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AUSTRALIAN SOILS AND CLIMATE CHANGE ECONOMICS

Introduction 3. Key Factor #1: The Potential of Australian Soils 4. Key Factor #2: Myths About Australian Soil C 6. Key Factor #3: The Unique Role of Soils. 11. Key Factor #4: The Bridge To The Future. 14. Key Factor #5: Urgency 15. Key Factor #6: Soil MMV and the Uncertainty Principle 18. Key Factor #7: The Clash of Paradigms. 24. Key Factor #8: Soil Carbon Market Operating 27. Key Factor #9: Gaining Farmer Engagement 36. Key Factor #10: Practical Considerations 39. Key Factor #11 Soil Carbon and Climate Change 49. Key Factor #12: Support for the Coalition’s Submission 55. Conclusion 61. Appendix 1 Limitations of NCAS data 1 63. Appendix 1 Limitations of NCAS data 2 64. Appendix 2: Carbon Farming 65. Appendix 3: Uncertainty and the GHG Protocol 70. Appendix 4: Voluntary Carbon Standard 73. Appendix 5: Scientific method and alternative agriculture 75. Appendix 6: Attempts to “Guide” the Enquiry’s Findings 77. Appendix 7: About the Carbon Coalition 79.

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Introduction The Garnaut Climate Change Review has a greater responsibility for the well-being of generations to come than any other enquiry in Australia’s history. Its findings and recommendations will have an impact that will affect the security of all Australians.

Soil Carbon is a divisive issue. It divides scientists and policy makers and their advisors. It divides landholders and industry association leaders. It has led to wild and unsupported statements from both sides. It has all the hallmarks of a clash between competing paradigms, as described by Thomas Kuhn in The Structure of Scientific Revolutions.

The conflict is based on fundamental scientific principles of replication (repeatability of experiments) and reductionism (isolating a single variable for study) and the study of complex ecological systems, including the failure of experimental scientific method to reproduce the findings of farmers on their properties.

These tensions have not kept a group of Australia’s most prominent sol scientists from joining with farmers and graziers in meetings and conferences to build bridges and share perspectives. The Carbon Coalition thanks these scientists and the agronomists and agency personnel who have reached out to producers.

World authority on soil carbon, Dr Rattan Lal, who described our Carbon Farming Conference in November 2007 as “an historic event of international significance”, has sounded the call to arms for his colleagues: “While the market is just developing, there is vast scope for growing soil C as a cash crop… Researchers must put their act together before the train leaves the station.”

All objections and anxiety about difficulties with soil C should be seen in context of our objectives: preventing the disintegration of the infrastructure of our civilization through the impact of extreme weather events and armed conflict between nations and peoples displaced in their millions, desperate and seeking shelter, land and water. These are the warnings of the Australian Federal Police, the Australian Defence Force, and the Pentagon.

If the amount of time and energy that has been expended in finding objections to soil C trading had instead been channeled into finding solutions to the difficulties, the world would already be safer place for our children and grandchildren.

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AUSTRALIAN SOILS AND CLIMATE CHANGE ECONOMICS

The Carbon Coalition1 represents Australian farmers and those scientists and agronomists who believe:

• that soil carbon can make a significant and dramatic impact on the overload of greenhouse gases in the atmosphere, both current and future;

• that Measurement, Monitoring and Verification of soil carbon for

trading need not be difficult or expensive;

• that equity demands that landholders be given access to the offsets they can grow in their soils to meet their liabilities arising from on-farm emissions from other GHGs.

The case for Soil C Trading in Australia is based on 12 Key Factors: Key Factor #1: The Potential of Australian Soils The Coalition contends that the potential contribution of soils to removing carbon from the atmosphere is so great that, rather than its proponents having to argue for its consideration, those who oppose its deployment should be required to give evidence against this potential. No such evidence has been produced to date. The proponents, on the other hand, have produced evidence of the potential for Australian soils to sequester carbon. While no one research study has tested soil carbon sequestration under ideal conditions to reveal our soil’s full potential, several cases have recorded significant shifts that put the lie to commonly held misconceptions.

• Exhibit 1: The NSW DPI, DECC and CSIRO are currently evaluating an increase in soul carbon recorded on grazing and cropping land from 2% to 4% recorded on “Winona”, Gulgong, between 1995 and 2005. 2

1 See Appendix 6. 2 Colin Sies, “Combinations That Move The Carbon Needle: Grazing Management, Pasture Cropping, and Biological Farming”, Carbon

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• Exhibit 2: There was a 0.46% carbon difference between a

paddock managed by conservation farming techniques (stubble retained/no-tillage) and a paddock heavily grazed and conventionally tilled over 10 years at Greenethorpe, NSW translated into a difference of 185 tonnes of carbon per hectare (or 675 tonnes of CO2e.)3

• Exhibit 3: A CSIRO study (unpublished) in Albany WA found a

significant difference in organic matter between two paddocks, one stubble-burned 3 years previous then no-tillage treatment for three years (3.35% OM), the other managed with no-tillage (5% OM).

• Exhibit 4: Dr K Yin Chan, Principal Research Scientist (Soils),

NSW Department of Primary Industries, has a research project which has stretched over 20 years. In the soils studied, he found that there was on average 70 tonnes of soil carbon per hectare under undisturbed native vegetation. This fell dramatically to 40 T/ha under conventional tillage by the 1940s. It rose 5T/ha under Reduced Tillage, to 45T/ha. Dr Chan believes we can recover the (25T/ha) balance. He calls it the "Soil C Sequestration Potential".4

• Exhibit 5: “Permanent unimproved pastures in moister areas of

NSW, SA, WA and Qld, after sowing to introduced grasses and legumes and fertilised with superphosphate have been shown to exhibit linear increases in soil C at a rate of about 0.4 t C ha-1 yr-1 over several decades.5 (Russell and Williams 1982, Gifford et al 1992).

Farming Expo & Conference, 16th-17th November, 2007, AREC, Mudgee. Ian is Catchment Coordinator, Lachlan CMA, PO Box 510, Cowra 2794. 3 Ian Packer, “Quantifying the Obvious - Soil Management Impact on Soil Carbon Sequestration, Carbon Farming Expo & Conference, 16th-17th November, 2007, AREC, Mudgee. Ian is Catchment Coordinator, Lachlan CMA, PO Box 510, Cowra 2794. 4 Presentation at DPI farmers’ gathering at Junee Reef, 21 June, 2007. 5 Gifford RM, Cheney NP, Noble JC, Russell JS, Wellington AB and ZamitC (1992) Australian land use, primary production of vegetation and carbon pools in relation to atmospheric carbon dioxide concentration. pp151-187 in Australia’s Renewable Resources, Sustainability and Global Change. Roger M. Gifford and Michele M. Barson (Eds) Publ

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• Exhibit 6: Barrow (1969) reported a soil C gain of 440 kg/ha/yr in

sandy soils under permanent pasture during a period of 30-40 years in Western Australia. The pasture outscored undisturbed native vegetation on soil C by 2.0% to 0.8%.6

• Exhibit 7: Senior CSIRO soil scientist Jeff Baldock says there is

today no technical barriers to a fully-functioning market in soil carbon, and that such a market could make it ‘more economic to farm for carbon than to farm for yield.’7

These case studies and other expert opinions indicate that Australia’s 450 million hectares of agricultural soils have the potential to make a powerful contribution to the national effort to mitigate Climate Change. Key Factor #2: Myths About Australian Soil C. The science of soil carbon has been misinterpreted in Australia, so much so that “myths” have gained traction in the public mind. The dominant view of the soil C sequestration potential of Australian soils in the scientific community, among policymakers and industry opinion leaders was established at a 2000 workshop sponsored by the CRC on Greenhouse Accounting on sequestration. The report concluded that: “Australian climate, soils and agricultural management histories are significantly different to those of developed countries in the northern hemisphere. These differences generally result in considerably less Bureau of Rural Resources and CSIRO Division of Plant Industry. Quoted in “Pasture improvement for potential additional C-sinks for inclusion under the Kyoto Protocol”, by Roger M. Gifford, Damian J. Barrett and Andrew Ash (with input from Miko Kirschbaum, John Donnelly, Richard Simpson and Mike Freer) for the Biosphere Working Group of the CSIRO Climate Change Research Program, 30 April, 1998

6 Barrow, N. J. 1969. The accumulation of soil organic matter under pasture and its effect on soil properties. Australian Journal of Experimental Agriculture and Animal Husbandry 9:437-445. 7 ABC Rural Radio, October 2007, Orange Field Days.

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potential for increase in soil carbon stocks associated with changing crop or pasture management practices in Australia compared with northern temperate regions.”8. While this was not a definitive statement, the conclusion was distilled in an Australian Greenhouse Office policy framework document as: “Typically Australian soils have a poor capacity to store large quantities of carbon."9 This statement was based on research done for the National Carbon Accounting System (NCAS). But analysis of Technical Reports 3410 and 43, the core data reports for the construction of the NCAS, reveals that the data sets are incomplete, focusing almost exclusively on conventional rather than regenerative land management techniques. It studied only soils managed in ways that caused losses of carbon rather than samples managed in ways that capture and store carbon (ie. regenerative land management techniques such as biological farming, time controlled grazing management, pasture cropping, etc.) For this reason, there are gaps in the data sets. Therefore the data cannot support the conclusions being drawn from it. The authors of the Technical Report 34 complained that the study was insufficiently resourced to cover the range of land management styles:

• “As it would have been too time-consuming and expensive to examine land clearing in all parts of the State, the AGO specified that this project should focus on certain clearing hotspots in NSW…” (Ie. only high emissions locations were selected.)

• “However, with resources for ten possible comparative sites, only

a limited range of land-use transitions were included in the study… It should be noted that ten paired sites is not a sufficient number to adequately sample all the land use changes that are occurring in

8 Keenan, R., Bugg, A.L., Ainslie, H. (eds) (2000) Management Options for Carbon Sequestration in Forest, Agricultural and Rangeland Ecosystems. Cooperative Research Centre for Greenhouse Accounting, p. 1 9 Australian Greenhouse Office, Developing a Strategic Framework for Greenhouse and Agriculture. An Issues Paper, 2002 10 Technical Report No. 34 Paired Site Sampling for Soil Carbon Estimation – NSW, National Carbon Accounting System, Australian Greenhouse Office, January 2003

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the clearing belt in NSW… (Ie. insufficient data sets.)

• “Classifying the paddock histories into particular management practices can be difficult, as a ‘recognised practice’ may have considerable variation in the methods and effectiveness with which it is implemented. The environmental and economic conditions under which practices are implemented can also vary. Both these things can cause variability in any expected changes in soil properties...”

The authors of Technical Report 43 also complained of a lack of data:11 “Data from over 50 independent studies across Australia was compiled to create a comprehensive data set of 586 values. Information identifying associated site histories, climate and soil type was recorded. “Of the trials considered, many had incomplete information, lacking details on: • soil properties below a depth of 10 cm; • carbon densities; • soil bulk densities; • implements used during tillage operations; • other issues relating to tillage operations; • stubble management practices; and • historical site management data.” The consultant hired to assess the data sources was also concerned:12 “While there are some very useful datasets available, there are also considerable deficiencies in the completeness of the data… In many established agricultural areas, there are practical difficulties in finding true pairs… The approach is limited by gross lack of data…”

11 “The Impact of Tillage On Changes in Soil carbon Density with Special Emphasis on Australian Conditions”, National Carbon Accounting System Technical Report No. 43, Australian Greenhouse Office, January 2005 (See Appendix 1) 12 Estimation of Changes in Soil Carbon due to Changed Land Use National Carbon Accounting System - Technical Report No. 2 November 1999

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Data issues also plagued the Roth C Modelling system, developed to model the effects of agricultural management on the stock of organic carbon, which may have skewed results: “There are difficulties associated with collecting pasture residue data…There are deficiencies in knowledge of carbon dynamics in these situations and the capability to model residues in soil are relatively undeveloped. Uncertainties in soil carbon dynamics through factors such as grazing pressure, pasture production responses, excreta inputs and carbon immobilisation, restrict confidence in modelling of soil carbon inputs. The option for these areas is to use models to estimate average residue inputs under grazing, acknowledging the constraints to the data, and to use a panel of experts in each grazing region to review the estimates.”13 The data was insufficient. “Development of the NCAS was undertaken with the clear understanding that data would be imperfect, but that the significance of data limitations could be assessed only in a functional integrated system.” 14 The AGO took a ‘fix it in the mix’ approach: “The tacit acceptance of variability in data provided for a proper focus on matters of accuracy and bias, rather than on potentially unachievable precision.” The Agency believed the sheer weight of data points would carry the day, provided there was no bias in the inputs: “Over a large sample … a national inventory derived from an aggregation of fine-scale events can provide a robust central estimate provided inputs are not biased.” But the inputs were biased. The data sets were incomplete. Despite this obvious defect in logic or basic scientific methodological process, the potential of Australian soils was dismissed as a Climate Change mitigation solution. And this myth grew in the telling. Our soils were not only too degraded to sequester carbon, they were also too old. (NB. Neither of these factors affects carbon sequestration.)

13 Technical Report No. 2 14 “Methods for Estimating Land Use Change Emissions “, Factsheet, National Carbon Accounting System, Australian Greenhouse Office, August 2002

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The Australian Farm Institute added its gravitas to the myth: "The bulk of Australian farms may not operate as carbon sinks, due to the age of the soils."15 The most definitive version of the myth was announced by the Grains Council: “Given the age and degraded nature of Australian cropping soils and the ‘natural’ low levels of organic carbon, there is no scientific evidence to suggest that there is a real possibility that organic carbon levels can be increased by cropping or farming practices at anything other than slow rates, reaching an equilibrium point well below that of northern hemisphere soils.”16 The head of the soil science department at a leading university – on hearing of this comment - laughed out loud: "What a curious thing to say. Soil age is irrelevant.” A senior government soil scientist working in the field said: "There are many myths out there. The people who make these remarks don't get around enough to know what's going on." The Grains Council took to the airwaves in an energetic campaign to bury Australian soils: “Our soils are very old, very fragile, very thin, very weathered. Often we are running soils with 1% or less carbon.” 17 Generalisations about Australians soils are dangerous. Alpine soils can contain around 10% soil carbon, and desert soils around 0.5%. Soils tested for soils workshops with farmers at Mudgee and Rylstone have between 0.9% and 7% Carbon and averaging 2.2% at Mudgee and 2.7% at Rylstone.18 One percent of carbon is a significant amount. It can translate into 42 tonnes of soil carbon which equates to 154 tonnes of CO2e per hectare (at Bulk Density 1.2 and 30cms depth). A 1% increase in soil carbon per hectare – at $25/tonne – in this situation would be worth $3850. Multiply by a thousand hectares and you have a significant figure.

16 “Carbon in Australian Cropping Soils: A background paper prepared by Alan Umbers For the Grains Council of Australia.” July 10th 2007 17 Alan Umbers, Grains Council, ABC Radio Country Hour, 11 July, 2007 18 Private conversation, Soils Coordinator, Central West Catchment Management Authority, July 2006

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The Grains Council was broad ranging in its arraignment of Australian soils: “The limited potential for Australian soils to increase levels of organic carbon, with estimates by many scientists of less than 100kg per hectare per year, even under the most effective non irrigated farming systems.” No AGO research has studied the “potential” of Australian soils to take up carbon. Most official studies recorded poor carbon performance because they studied only traditional techniques which are destructive of soil carbon. They did not find sequestration because they weren’t looking for it. They were looking for declining carbon. The paradigm under which the NCAS was constructed was of an Australia forested from shore to shore when Captain Cook arrived. The arrival of Europeans was disastrous for native vegetation. Australian agriculture was, by nature, destructive. Deforestration was the key activity and it was assumed it always led to soil C depletion. “This project [the NCAS] emanated from the need to consider the temporal and quantum extent of change in soil carbon, due to land use change that involves the clearing of forest and woodland.”19 There are several trials underway to fill the gaps. Further evidence that the gaps existed and the conclusions were unsustainable. Key Factor #3: The Unique Role of Soils. The world has 10 years to take meaningful action that makes a difference in the trajectory towards climate chaos it is following, according to Sir Nicholas Stern and NASA’s James Hansen20. 19 Technical Report No. 2 20 James Hansen, director, NASA’s Goddard Institute for Space Studies. http://www.cbsnews.com/stories/2006/03/17/60minutes/main1415985.shtml The Stern Review on the Economics of Climate Change, October 30, 2006,www.hm-treasury.gov.uk/independent_reviews/stern_review_economics_climate_change/sternreview_index.cfm

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The Legacy Load is a term we coined to describe the existing CO2e overload already in our atmosphere (from 200 years of excess emissions) which is enough to drive the global mean temperature through the critical 2°C level. The concept of the Legacy Load is widely accepted by Climate Change leaders:

• "Twenty-first century anthropogenic (human) carbon dioxide emissions will contribute to warming and sea level rise for more than a millennium, due to the timescales required for removal of this gas.”1 Chair of IPCC Rajendra Pachauri, Yahoo News, 25 January, 2007

• “The carbon dioxide that’s in our atmosphere today – even if we

were to stop emitting it tomorrow – would live for many decades, centuries and beyond,” said Dr Susan Solomon, senior scientist of the of the Global Monitoring Division of the U.S. National Oceanic and Atmospheric Administration. 1

• “A fraction of the carbon dioxide that we’ve put into the

atmosphere today due to human activity would still be there in 1,000 years.” 1 Global Response to Ozone Hole Is "Unprecedented" Success, Cheryl Pellerin The United States Mission to the European Union, August 24, 2006

• “Even if humanity were to stop emitting carbon dioxide today,

temperatures will keep rising and the impacts keep changing for 25 years.”1 Sir Richard King, Britain’s Chief Scientist, The Age, 4 June, 2006

• “Much of the climate change likely to be observed over the next

few decades will be driven by the action of greenhouse gases already accumulated in the atmosphere.” Climate Change: Risk & responsibility, Final Report, Australian Greenhouse Office, Department of the Environment and Heritage, March 2005

None of the popular solutions to Climate Change – including solar and wind power, thermal and nuclear, biofuels and waste management – can address the Legacy Load of GHG already loose in the atmosphere. Photosynthesis is the only process known to science that can soak up this load. Forests are incapable of doing the job for several reasons:

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a. there is not enough land suitable for planting enough forests to reach critical mass; b. most forest species are net emitters for the first 5-15 years; c. it would take more than 20 years to plant and grow the forests to critical mass anyway; d. it would be prohibitively expensive; and e. it would take seven planet earths covered with forests to do the job21. Only agricultural soils have the capacity and capability to absorb the Legacy Load for the following reasons:

• There are 5.5 billion hectares of agricultural land that can start sequestering Carbon with relatively small changes in management to unlock their potential.

• If the world’s farmers were able to sequester 0.5t/C/ha/year, they

could absorb close to 2tonnes CO2e/ha/year – or 11gigatonnes of CO2e. This is more than the excess CO2e emitted by the entire world.

• Soil already holds more carbon than the atmosphere and all the

forests of the world combined. Soil organic carbon is the largest reservoir in interaction with the atmosphere. Vegetation 650 gigatons, atmosphere 750 gigatons, soil 1500 gigatons.22

No matter what it lacks in terms of formal qualifications, agricultural soil is the only option the world has if it wants to take meaningful action in the short term to mitigate Climate Change and avoid the worst outcome. The IPCC scientists continue to report that the effects of global warming are happening faster than predicted previously and that global emissions levels are rising faster than can be managed with existing strategies. Only soils are equipped with the capacity and capability to answer the challenge of the moment. 21 Tim Cadman, forestry researcher at the University of Tasmania: "We don't have enough land to make up for all our emissions; you would need seven planets." Sydney Morning Herald “A green response or just a guilt trip?” 27/01/2007 22 (United Nations Food & Agriculture Organisation) -

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Key Factor #4: The Bridge To The Future. Only agricultural soils can be our “Bridge To The Future” – enabling humanity to transition from confusion and uncertainty to a secure future in which what today are unproven technologies will be known quantities. Soils can be deployed immediately, but they will reach saturation within 30 years, by which time the other solutions will have reached critical mass. The convenors of the Carbon Coalition travelled to the United States and interviewed soil experts on the ability of soils to sequester carbon and the means to measure and monitor movements in soil carbon over time. Some of their comments follow.

• “Carbon sequestration in soil and vegetation is a bridge to the future. It buys us time while alternatives to fossil fuel take effect.”

• Dr Rattan Lal, Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food, Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award, World Congress of Soil Science 2006

• "Unlike many other technologies to offset fossil fuel emissions,

land management for soil carbon sequestration can be implemented immediately, provided there are incentives to do so. An immediate offset of CO2 emissions provides a significant delay in the rise of atmospheric of CO2 concentration. By the time that land management carbon sequestration begins to saturate the soil’s capacity to store additional carbon, other methods of reducing emissions or sequestering carbon may be available or already in use.”

• Professor Bruce McCarl, Agricultural Economist and Economist, Climate Change, Texas A&M University; Member of the Intergovernmental Panel on Climate Change

• "Terrestrial C sequestration has immediate application in climate change mitigation due to its availability and relatively low cost."

- Professor Charles Rice, Department of Agricultural Economics, Kansas State University, Director of the Consortium for Agricultural Soils Mitigation of Greenhouse

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Gases. Dr. Rice is recognized as one of the leading soil microbiologists in the United States.

• “Terrestrial sequestration is here and now. It’s user friendly. It’s

easy to do. It can play a critical role in the early stages of our response, ahead of other methods [forestry, geologic burial].”

- Dr. John Antle, Professor of Agricultural Economics and Economics at Montana State University, Technical Leader, Economics, BigSky Carbon Sequestration Partnership

As a technique which can be applied with most effect in the first 30 years, the Coalition suggests that the 100 Year Rule be set aside for soils and a 30 year rule be substituted.

The 100 Year Rule is inappropriate for soils because:

• Farmers do not like giving a legal right over their land for 100 years. (The experience of Landcare Carbon Smart is instructive.)

• Farmers are proud of what they have grown and the education they

received growing the carbon rich soil will make them disinclined to manage it in a carbon-emitting manner.

• Soil that has saturated with soil carbon is highly productive and drought resistant. It would be highly valued by any new owner.

Key Factor #5: Urgency “To protect the climate system for present and future generations” Nothing in this expression of the core objective of the United Nations Framework Convention on Climate Change in 1992 resounds with the urgency of the emergency unfolding around us. Given the damage Climate Change could potentially inflict on the world, akin to warfare, the barriers placed before the soil C solution seem trivial, given its potential. Natural disasters – such as Cyclone Katrina in New Orleans – can destroy the infrastructure of life and threaten civil society. We can expect more Katrinas. The rate of natural diasters per year has more than doubled since 2000, according to the UN’s World Meteorological Organisation.

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There were 190 in the 1980s, 270 in the 1990s, but the number has jumped to 553 between 2000 and 2005.23 Australia is particularly under threat, according to our police and military, from climate change refugees, driven in their millions by rising seas and failing crops, to invade our shores in vast numbers.

• Australian Federal Police Commissioner Mick Keelty: “Climate Change will be the security issue of the 21st century… We could see a catastrophic decline in the availability of fresh water. Crops could fail, disease could be rampant, and flooding might be so frequent that people en masse would be on the move... It's not difficult to see the policing implications that might arise in the not-too-distant future… In their millions, people could begin to look for new land and they will cross oceans and borders to do it… Existing cultural tensions may be exacerbated as large numbers of people undertake forced migration.”24

• Chief of Defence Force, Air Chief Marshal Angus Houston: The

Australian Defence Force has identified climate change as a national security threat for the first time, as it predicted the military would become more involved in stabilising failing states than fighting conventional wars. ACM Houston said the military faced security challenges it had not envisaged before, specifically "climate change and the impacts of global demography".25

• Britain's Chief Scientist Sir David King: “In Asia around the Indian coastline, Bangladesh, Indonesia, their rising sea levels and storm levels will actually remove the habitat of a significant proportion of the population. By 2080 we’re estimating something like 50 to 100 million people displaced from their place of habitat. Now that isn’t

23 “Distribution of Natural Disasters : By Origin, (1900-2005)”, International Strategy For Disaster Reduction, World Meteorological Organisation http://www.unisdr.org/disaster-statistics/occurrence-trends-century.htm 24 ABC News Sept 25, 2007

25 “Climate threat in military's sights,”, Sydney Morning Herald, May17,

2007

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going to only impact on those regions. That will destabilize the political and economic basis of the global system, and of course this is something to be avoided.” Australia’s region could become one of the most troubled by climate refugees, says Sir David King.26

• Pentagon Report (Schwartz and Randall 2003): A report

commissioned by the United States Pentagon found that gradual global warming could lead to a relatively abrupt slowing of the ocean’s thermohaline conveyor, which could lead to harsher winter weather and lead to resource skirmishes and even wars because of food shortages, decreased availability of fresh water, and disrupted energy supplies.27 “The United States and Australia are likely to build defensive fortresses around their countries because they have the resources and reserves to achieve self-sufficiency…. Borders will be strengthened around the country to hold back unwanted starving immigrants…This report suggests that, because of the potentially dire consequences, the risk of abrupt climate change, although uncertain and quite possibly small, should be elevated beyond a scientific debate to a U.S. national security concern.” The report says Indonesia – home to 200 million Muslims – is likely to descend into disorder.

The Carbon Coalition contends that the world community should – in light of the urgent need for a solution of the capacity and capability of soils – take a risk on a relatively ‘untried’ technology: soil sequestration. The UNFCCC exists “To protect the climate system for present and future generations”. Nowhere in its charter does it exists to create and accounting system. Nowhere does it say all solutions must be triple tested and compliant with all relevant standards. The world does not have time to fill out all the forms at the Quartermaster’s store to requisition a gun. The enemy is at the gates. 26 The Science Show, ABCTV, 22 October, 2005 27 Shwartz, P. and Randall, D. An Abrupt Climate Change Scenario and Its Implications for United Nations National Security. Report to US Pentagon. October 2003.

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Key Factor #6: Soil MMV and the Uncertainty Principle The Carbon Coalition contends that the demands for precision of measurement made of soils go far beyond the exactitude demanded of other sinks. This is because policy makers have ‘framed’ the question the wrong way. The question should not be: “How can we measure soil carbon with exactitude that matches other forms of carbon sinks or offsets?” The question should be: “How can we construct a measurement system that will satisfy buyers of offsets and make the trade in soil carbon?”28 MMV stands for Measurement Monitoring and Verification. It is the process through which greenhouse gas accounting is conducted. It suits trees (above the groundline). But it doesn’t suit soils because soil carbon is subject to “Flux”. Carbon ‘cycles’ in and out of its ‘sinks’ – soil, ocean, vegetation, and atmosphere (as well as mineral forms in geological deposits, such as coal and diamonds). The movement between atmosphere and soil takes place by several processes: photosynthesis, methane emissions from rotting microbes and dead vegetation, etc. The soil and vegetation “breathes” during the day: breathes out Oxygen during the day and CO2 during the evening. So a measurement taken at midday would be different to one taken at midnight. However, this is not a barrier to estimating the amount of Carbon in a paddock. Water ‘fluxes’ into and out of the human body. But if your body is 70% water today it is likely to be 70% water tomorrow and next year – unless you change the muscle/fat ratio (the body management style).

28 When President John F. Kennedy decided that the US would put a man on the Moon, his brief to scientists was: put a man on the moon. He did not want to know precisely how far away the Moon was at the time or its weight. He wanted a practical outcome.

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US scientists are questioning the importance of ‘flux’ and demanding that soil scientists come into the real world and find solutions:

Dr John Kimble: "It is often pointed out that soils have a large amount of variability, but with knowledge of soil sciences and landscapes, variability can be described and sampling protocols can be developed to deal with this," writes Dr John Kimble.29 "One reason I feel people say that soils vary and SOC cannot be measured is that we soil scientists focus on showing variability, not on showing what we know about the variability.” Dr Kimble recently retired from the US Department of Agriculture, National Resources Conservation Service, National Soil Survey Centre, Lincoln, Nebraska. "We too often focus on this [variability], worry about laboratory precision and field variation and do not look at the real world where most things are based on averages and estimated data. We tend to focus on finding variation and not on using our knowledge of soil science to describe what we know. All systems vary, but in soils we focus on a level of precision and accuracy that may not have any relevance to the real world because we can take so many samples and look at the variation."

Dr Rattan Lal: “While techniques of measuring concentration of C

in soils, methodologically sampled and carefully prepared for laboratory analysis, are well known, the principal challenge to soil scientists lies in: (i) upscaling the point data to landscape, farm, watershed or a region comprising 100,000-200,000 ha (ii) evaluating changes in soil C with reference to a baseline for cultivated land unit comprising a large farming community, and (iii) verifying that the C thus sequestered is permanent and not re-emitted because of changes in land use or management practices… Soil and tillage researchers must be pro-active in this important theme.”30

29 Kimble, J., "Advances In Models To Measure Soil Carbon: Can Soil Carbon Really Be Measured?", in Lal, R., Cerri, C., Bernoux, M., Etchevers, J., and Cerri, E., eds., Carbon Sequestration in Soils in Latin America, Food Products Press, Birmingham, NY, 2006 30 Dr Rattan Lal, “Farming Carbon”, Soil & Tillage Research 96 (2007) Dr Lal is Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food, Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award,

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The Carbon Coalition contends that the entire Kyoto Protocol process is entangled in uncertainties, and that these uncertainties and ambiguities have been addressed to achieve practical outcomes. We believe soil has been subject to discrimination and hyper-exactitude. Uncertainty and Forests as C Sinks Uncertainty afflicts forests as tradable sinks:

• “In soils we can go to a 100m2 field and sample every square meter and look at the differences we find. But if you sample every tree in a large area you would see a similar variability,” says Dr Kimble.

• The Australian Academy of Science stated that “accounting for the

carbon contained in forests is difficult. The amount of carbon in forest soils, forest litter and the trees themselves needs to be measured. Different types of trees store different amounts of carbon when growing on different types of soils in different climates. In addition, we might expect natural year-to-year variations in carbon stored, related to climate variations.”31

Scientists have accused the Kyoto solution for forests as being riddled with uncertainties: More than 50% of the carbon stored in a forest can be found beneath the ground. Yet it is not counted. This is dangerous because the changes in below ground C-stocks can be in the opposite direction from the changes above ground upon a change in land use.

• “A decline in soil C has been observed in NSW for pastures planted to radiata pine. There are several other examples in the literature of soil C-content being lower under trees than under matched pasture sites and indeed a process-modelling study of pastures in south-central USA planted to pine plantation predicted a decline in soil organic C down to 1m depth over 50 years. Thus if changes in soil C are not included with the estimate of the above

World Congress of Soil Science 2006; President, American Soil Science Society 31 http://www.science.org.au/nova/054/054key.htm NOVA Science in the news

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ground plantation sink, that plantation sink will be wrongly estimated.”32

• “It is possible for a forest to be a source of emissions rather than a sink…. The soil organic pool is a large carbon reservoir: in a mature forest it commonly contains at least 50% of the total forest carbon stock. .. When agricultural land is reforested there may be significant losses from the soil carbon pool… Soil carbon is likely to decrease initially, as a result of a decline in pasture litter inputs in the early phase of plantation establishment, and then increase as litter input from the forest is added to the system. The decline in soil carbon is usually temporary: as the plantation grows, soil carbon will be replenished from litter fall and root turnover, usually restoring soil carbon stock to original levels within 30 years (Paul et al., 2002). If the site being reforested has a high concentration of readily decomposable soil carbon, such as may occur under a heavily fertilised, irrigated pasture, then the soil carbon stock may not reach the level under the previous pasture system. There is some evidence that soil carbon stock is lower under pine plantations than eucalypts (Guo and Gifford, 2002; Paul et al., 2002). …Significant losses of soil carbon after reforestation are most likely in soils that are high in labile carbon, such as where new plantations are established into pastures that have been heavily fertilised, and enhanced productivity has elevated the soil carbon above native levels. … It would be prudent, in predicting forest carbon sequestration, to assume a decline in soil carbon stock for reforestation of pasture soils”33

32 Gifford RM, Cheney NP, Noble JC, Russell JS, Wellington AB and ZamitC (1992) Australian land use, primary production of vegetation and carbon pools in relation to atmospheric carbon dioxide concentration. pp151-187 in Australia’s Renewable Resources, Sustainability and Global Change. Roger M. Gifford and Michele M. Barson (Eds) Publ Bureau of Rural Resources and CSIRO Division of Plant Industry. Quoted in “Pasture improvement for potential additional C-sinks for inclusion under the Kyoto Protocol”, by Roger M. Gifford, Damian J. Barrett and Andrew Ash (with input from Miko Kirschbaum, John Donnelly, Richard Simpson and Mike Freer) for the Biosphere Working Group of the CSIRO Climate Change Research Program, 30 April, 1998 33 Tony Beck, Annette Cowie, Beverley Henry, Miko Kirschbaum, John Raison, “Forestry Carbon Sequestration Review”, Cooperative Research Centre for Greenhouse Accounting, September 2005

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Uncertainty and the Global Greenhouse Gas Protocol The unavoidable uncertainty the typifies all Climate Change activities is acknowledged in the Greenhouse Gas Protocol developed by the World Resources Institute and the World Business Council for Sustainable Development.34 It identifies two types of uncertainty in estimating emissions or sinks:

- scientific uncertainty and

- estimation uncertainty.

The latter is further divided into

- model uncertainty and

- parameter uncertainty. (See Appendix 3)

• Scientific uncertainty arises when the science of the actual emission and/or removal process is not completely understood. For example, many direct and indirect factors associated with global warming potential (GWP) values that are used to combine emission estimates for various GHGs involve significant scientific uncertainty. Analyzing and quantifying such scientific uncertainty is extremely problematic and is likely to be beyond the capacity of most company inventory programs.

• Estimation uncertainty arises any time GHG emissions are quantified. Therefore all emissions or removal estimates are associated with estimation uncertainty. Estimation uncertainty can be further classified into two types: model uncertainty and parameter uncertainty. Model uncertainty refers to the uncertainty associated with the mathematical equations (i.e., models) used to

34 The Greenhouse Gas Protocol (GHG Protocol) is the most widely used international accounting tool for government and business leaders to understand, quantify, and manage greenhouse gas emissions. The GHG Protocol Initiative, a partnership between the World Resources Institute and the World Business Council for Sustainable Development, provides the accounting framework for nearly every GHG standard and program in the world - from the International Standards Organization to the EU Emissions Trading Scheme to The Climate Registry.

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characterize the relationships between various parameters and emission processes. For example, model uncertainty may arise either due to the use of an incorrect mathematical model or inappropriate input into the model. As with scientific uncertainty, estimating model uncertainty is likely to be beyond most company’s inventory efforts;

• “…uncertainty estimates for corporate GHG inventories will, of necessity, be imperfect.”

• “For these reasons, almost all comprehensive estimates of uncertainty for GHG inventories will be not only imperfect but also have a subjective component and, despite the most thorough efforts, are themselves considered highly uncertain.”

• “... a reduction in air travel would reduce a company’s scope 3 emissions. This reduction is usually quantified based on an average emission factor of fuel use per passenger.

• “Generally, as long as the accounting of indirect emissions over time recognizes activities that in aggregate change global emissions, any such concerns over accuracy should not inhibit companies from reporting …

Uncertainty and the National Greenhouse Gas Inventory Uncertainty is a key aspect of greenhouse emission estimates produced for publication in the National Greenhouse Gas Inventory.35 The Inventory is compiled from data from a range of sources, and in many cases represents a ‘scaling up’ of sample, experimental or case study results (much in the way Lal ecommends). There is an active process of continual improvement underway — but AGO is open about the fact that some estimates are likely to be more reliable than others. For the 2003 NGGI, the AGO estimates an uncertainty band for the estimated national emissions outcome of 550 Mt CO2e ±5.2%. “Uncertainty over agricultural emissions makes a relatively strong contribution to uncertainty regarding the overall national emissions outcome —particularly with respect to estimates for agricultural soils, 35 Allen Consulting Group 2006. Emissions Trading and the Land: issues and implications for Australian agriculture, April 2006. Report to the National Farmersʼ Federation www.nff.org.au/read/2428457177.html.l

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savanna burning, forestry and land clearing. However, the reported uncertainties appear to be primarily associated with uncertainty about activity levels rather than the complex and variable biological processes that generate greenhouse gases… The AGO reports that ‘… uncertainty in the reported cattle numbers was the most significant contributor to the overall uncertainty’36 Let this be noted and the question be put: Why, if the AGO has access to calculators for at least 5 sectors in Agriculture, have these calculators been delayed in deployment, if the reason given – difficulty in measuring biological processes – is no longer the case? The methods employed by the AGO to reconcile uncertainties with the Roth C Modelling system reveal an acceptance of a transitional model that reflected Dr John Kimble’s appeal for “real world” science. “Development of the NCAS was undertaken with the clear understanding that data would be imperfect, but that the significance of data limitations could be assessed only in a functional integrated system.” 37 The AGO took a ‘fix it in the mix’ approach – making no attempt at ‘precision’: “The tacit acceptance of variability in data provided for a proper focus on matters of accuracy and bias, rather than on potentially unachievable precision.”

The Carbon Coalition welcomes this flexibility and looks forward to the same open-minded, “can do” attitude in its future dealings with Government agencies. Key Factor #7: The Clash of Paradigms. The debate about Soil C Sequestration resembles the parable of the Tower of Babel. The parties speak different languages and owe allegiance to different paradigms of soil science. This clash of two paradigms is not a war between scientific hard-heads and idealistic soil mystics. It is a battle about which ‘facts’ should be admissible as evidence. The answer to the question, “Can our soils make a significant contribution to

36 AGO 2005, National Greenhouse Gas Inventory 2003, p.A121. 37 “Methods for Estimating Land Use Change Emissions “, Factsheet, National Carbon Accounting System, Australian Greenhouse Office, August 2002

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mitigation of Climate Change?” lies beyond the narrow definitions of Australian soils and their capabilities that applied before doing something about Global Warming became an action item. The phenomenon of scientists being unable to verify what farmers on the ground are finding was demonstrated in a paper called “Production-Oriented Conservative-Impact Grazing Management”. It was prepared for a WA Department of Agriculture workshop in 2002, by Dr Ben Norton.38 He points out that the majority of published research studies of rotational grazing find that continuous grazing is better than or comparable to rotational grazing in terms of either animal or plant production. Yet “Hundreds of graziers on three continents claim that their livestock production has increased by half or doubled or even tripled following the implementation of rotational grazing…” The answer to the conundrum lies in the methodology adopted by the scientists: the research trials employed only 16 paddocks or less in the rotation. A typical real-life rotational cell will have 40 to 80 paddocks, the high numbers affecting the amount of time animals are intensively grazing each paddock and the amount of time the paddocks have to recover. The organics industry has encountered the same problem: failure to translate the on farm environment into an experimental methodology.39 Dr Charles Benbroo of the Organic Centre explains: “One of the reasons that many studies done by academic scientists have failed to find consistent differences between conventional and organic food is because the scientists have based their field research on university experiment stations that have been farmed conventionally for twenty, thirty, or a hundred years. They attempt to convert some acreage to organic production, but typically do it quickly, accepting certain "compromises." They are simply not able to grow crops as skillfully as an experienced organic farmer. They don't have the time to build up their personal farming skills to match those of good organic farmers. They lack the time to work with a piece of land for five, ten, or twenty years in building up its fertility and capturing all of the biological benefits that are associated with organic farming.”

38 Dr Norton is Director, Centre For the Management of Arid Environments, Muresk Institute, Curtin University, WA. 39 “The Science of Organics: Peeling the Onion to Reach Core Truths” Dr. Charles Benbroo, Chief Scientist of The Organic Center http://www.organic-center.org/res.lead.benbrook.html

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There is also the issue of the whole of farm ecology effect vs the plot or potplant approach to trials. For instance, carbon farmers who increase the C score tend to see an explosion of biodiversity. A ‘flush’ of spiders or winged insects is often recorded. Colin Seis has had both in recent seasons.40 It happens because soil carbon has a complex relationship with biodiversity – both as cause and effect in a looped system. Dr Benbroo: “The deepest and most significant benefits of organic farming almost certainly arise from complex system interactions that are extremely difficult to isolate and control in replicated field studies. They also are hard to study through reductionist research strategies (i.e., carrying out research on one isolated component of a complex organic system). This does not mean that the benefits do not exist; it just means that two of the core strategies of western science - replication and reduction of complex systems to their component parts - are relatively inefficient in peeling away the layers of this onion.” The Carbon Coalition has been working with some of Australia’s brightest soil scientists to bridge this gap by bringing scientists and farmers together at a series of meetings in the Central West of NSW. These “Building Bridges” Meetings Between Carbon Farmers and Soil Scientists ocurred in Dubbo, March 2007, and Orange, June 2007 as invitation-only events, culminating in the world’s first Carbon Farming Expo & Conference, 16th-17th November 2007 at Mudgee NSW, with 400 delegates from every State and NZ. All speakers are either scientists or primary producers. The closer science can get to the farm, the better for science, the better for the farm.

40 Colin Sies, “Combinations That Move The Carbon Needle: Grazing Management, Pasture Cropping, and Biological Farming”, Carbon Farming Expo & Conference, 16th-17th November, 2007, AREC, Mudgee.

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Key Factor #8: Soil Carbon Market Operating The first trade in Australian soil carbon offsets took place on 6 March, 2007, when the an executive from a restaurant chain purchased a ‘subscription’ of 2 tonnes CO2e/month from Carbon Farmers of Australia. The transaction took place on a website called Adopta Farmer Fighting Greenhouse (www.adoptafarmer.com.au). It was set up as a test marketing exercise by the Carbon Coalition Against Global Warming, an activist group seeking to win for farmers the right to trade the value of the carbon they can grow in their soils. Several other committed individuals found the site – it was not publicised – and became ‘sponsors’ of the Coalition upon learning of its work. Their financial support takes the form of subscription. The trading activity served other purposes besides testing the water for demand of “gourmet carbon” (non-commoditised voluntary market transaction that are linked to and derive brand values from a cause). It helped Coalition members start the process of learning about the carbon trade bythe ‘learning-by-doing’ method commonly used in the carbon trading and climate change spheres. It also changed the nature of our relationship with our supporters, government agencies and the soil science community. No longer did we have to wait for official approval for the market to operate. Believing that a free enterprise system is based on the right of two individuals to freely enter into an arrangement by which value passes to one party for consideration (the buyer being protected by the law of contract and the power of bad publicity). And we had defied those who said there would never be a Market in soil carbon. The Market had spoken. Our buyers were attracted by the soil carbon vision: that by encouraging farmers to manage for soil carbon they were restoring farmland biodiversity and restoring ecological health to degraded soils while at the same tme they were helping to preserve family farming. We designed a graphic that showed the relationship between their money and the triple bottom line benefits.

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To assure us of supply, we started recruiting carbon farmers and, to facilitate this, established Carbon Farmers of Australia as a not-for-profit, with all profits going towards creating demand so members can sell their carbon. Simultaneously we market tested a recruitment drive and established www.carbonfarmersofaustralia.com.au as a recruitment device. We promoted it on the Carbon Coalition’s popular blogsite http://carboncoalitionoz.blogspot.com and have attracted 25 or more farmers who fit the job description: practicing Carbon Farmers who are committed to soil and landscape regeneration and additional revenue in equal amounts. The Carbon Farmers of Australia contract and handbook had to be developed. In the course of this process, we confronted the issue of Monitoring and Verification. Our solution was an evolving MMV model that grew as our capability developed: Stage 1: An imputed value model (based on CCX system), value based on benchmarks from available sources.

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Stage 2: An imputed value model, audited by a credible third party, based on a series of dimensions which can be measured visually and includes some degree of “baseline measurement of soil carbon” Stage 3: A direct measurement model which involves analysing core samples based on a MMV methodology that is cost effective and based on tolerances acceptable to the corporate market. Stage 1 Model Our Stage 1 offering of “Provisional Carbon Credits” was transparent and carefully expressed on the website: “ ��The CARBON FARMERS OF AUSTRALIA SOIL CREDIT is based on the following indicators:��

1. The history of soil management for the plot in question.

2. �The history of soil management for the entire property. �

3. The training record of the land manager.

4. �The land management techniques used on the entire property. �

5. The imputed increase in soil carbon in the plot in question over the period since the change in land management. �

6. Membership of Carbon•Farmers™ Of Australia, a group of conservation land managers who are also actively working to restore the natural resource base.

��NB. When the politicians and scientists finally catch on to the danger we are facing and the need for soil carbon credits, we will have a new system that accurately measures out the Carbon 'sequestered'. But we can't afford to wait for them. In the words of Professor Stuart Hill, UWS, "If you get tangled up in measurement you will sink into a quagmire and never achieve your goal."

��"PROVISIONAL CARBON CREDITS" - HOW THEY WORK

��CARBON FARMERS OF AUSTRALIA SOIL CREDITS are Provisional Carbon Credits. This is your guarantee that you are getting

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what you pay for. They are set at a very conservative rate of 2 tonne CO2e per hectare per year where land management has changed since 1990: ��• from till to no till (ploughing to no ploughing)�• from till to pasture �• from set stocking to grazing management��

These categories are based on estimates published by authorities such as the Australian Greenhouse Office: "The review clearly indicated that the introduction of a cropping phase into uncleared land or a well-established pasture with high plant biomass, reduced soil carbon density by 10 to 30 t/ha in soils to 30 cm depth... Likely changes in soil carbon densities associated with changes in soil tillage practices are of the order of 5 to 10 t/ha when they occur..." (Australian Greenhouse Office, National Carbon Accounting System, Technical Report No. 43, January 2005)

And the work of leading CSIRO soil scientists Roger Swift and Jan Skjemstad: “…it is suggested that a sequestration rate in the of about 2 Mt C pa is within the realms of possibility… Ideally the carbon levels can be restored to the same values that were supported the soils in their virgin state under native vegetation. In some instances the soils may be capable of sustaining higher organic matter levels than in their virgin state... Let us assume that half of the total amount of carbon lost from these soils can be recovered over a twenty year period and that in any one year one third of the 45 M ha is in a recovery or organic matter build-up mode. On this basis...the annual rate of sequestration of carbon by agricultural soils would be in the region of 4.4 Mt C pa. A more conservative target of 2.2 Mt C pa based on the treatment of 7.5 M ha pa ... could well be achieved. “- Roger Swift and Jan Skjemstad, “Agricultural Soils as Potential Sinks for Carbon”, CSIRO Land and Water for the CSIRO Biosphere Working Group, http://www.dar.csiro.au/csiro_reserved/BWG/agricultural_soils.htm

Our estimates are also informed by K.Y. Chan’s work on soil carbon levels under different land management methods in NSW which revealed

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that soil carbon levels were 2 to 2.7 times higher in pasture soil than in cropped soils, and up to 2.4 times higher in minimum till than in conventional tillage soils. (Chan, K.Y. “Soil particulate organic carbon under different land use and management,” Soil Use and Management (2001) 17, 217-221.)��

Once the science provides us with a verifiable measurement approach, the surface area will be rescaled to meet the amount 'measured' in the soil below. ��Provisional Carbon Credits allows the Soil Storage of CO2 to start! ………………………WEB COPY.ENDS We started with the proposition that a farmer in the Central West Catchment who changed land management techniques and was a practicing ‘Carbon Farmer’ could easily sequester 0.55tC/ha/year or 2 tonnes of CO2e per hectare per year. We chose that figure based on input from the following sources:

• Dr Christine Jones, Carbon For Life, a botanist and agronomist who has pioneered carbon sequestration in Australia, bringing together practitioners and specialists in a series of Carbon Forums across the nation.

• Members of the 10 farm families selected for the first “Farming

Systems” Program conducted by the Central West Catchment Management Authority. Those selected were considered the most innovative in the Catchment, having introduced some significant deviations from the norm The focus of the program was salination and soil health. (Members included Colin Seis, David Marsh, Rick Maurice, Angus Maurice, all of whom became members of the Advisory Council of the Carbon Coalition Against Global Warming.)

• A Literature Search of Australian soil science papers.

• Meetings with leading international figures such as Michael Walsh,

Senior Vice President, Chicago Climate Exchange (the first to trade in soil carbon offsets), and Dr Rattan Lal (Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food,

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Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award, World Congress of Soil Science 2006; President, American Soil Science Society)., and Professor Bruce McCarl, Agricultural Economist and Economist, Climate Change, Texas A&M University; Member of the Intergovernmental Panel on Climate Change.

Under Stage 1, buyers can come and stay with the farmer, watch “their” hectares develop, and learn about carbon farming. Stage 2 model: Performance Dimensions for Audit by Third Party We worked with Central West Catchment Management Authority Soils Officer John Lawrie to develop a standard audit regime for Stage 2. The following has been proposed: Audit based on 5 “Indicators” or proxies:

• increase groundcover and therefore biomass • increase perenniality & therefore produce more biomass • increase biodiversity of plants species and wildlife in and on the

soil • reduce soil disturbance and compaction • balance soil nutrition

Indicators can be used because they are all known to be related to increases in soil carbon – whether in a direct causal relationship or a complex self-reinforcing looped system. The first four indicators can be audited visually by members of the CMA staff or any third party certification service. Additionally we will require the following:

• Farm Plan with soils map • Soil tests of major nutrients, pH and carbon • Proposed Management plan for 5 years

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As soil carbon sequestration is based on climate, soil type, and land management, some provision has been made for climate in the form of a variable based on soil survey data.

• Tablelands 2.5% OC in top 10 cm = 0.75 tonnes Carbon/ha/yr • Slopes 1.7% OC in top 10 cm = 0.50 tonnes Carbon/ha/yr

• Plains 0.8% OC in top 10 cm = 0.25 tonnes Carbon/ha/yr

Payments will be made on the basis of these estimates Towards an Australian Voluntary Standard Carbon Farmers of Australia is committed to developing an auditable Standard acceptable to Voluntary customers in Australia. As the “Australian Voluntary Soil Carbon Sequestration Standard” develops, we will seek to register the methodology with the World Voluntary Carbon Standard, the world’s premier Standard for the Voluntary market. We have made an agreement with the National Association of Sustainable Agriculture in Australia (NASAA)41 to co-develop the Standard. NASAA will thereafter certify and audit our growers. Carbon Farmers of Australia will build on the knowledge and experience of NASAA in developing the Organic Certification Standard to develop the Australian Voluntary Soil Carbon Sequestration Standard. The following elements will form the basis of the Standard. This Standard will comprise four sections: 41 Formed in 1986, the National Association for Sustainable Agriculture, Australia (NASAA) is Australiaʼs leading national organic certifier. Through its role as a certifier, NASAA is committed to developing and maintaining standards; assisting operators in gaining certification; and conducting ongoing compliance supervision and inspection of certified operations. In addition to its national accreditation from the Australian Quarantine Inspection Service (AQIS) NASAA was the first Australian certification body to achieve accreditation through IFOAM (International Federation of Organic Agricultural Movements), and was the first to receive ISO65 (International Standards Organisation) status under the newly developed IFOAM/IOAS program

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• “General Principles” behind the architecture of Carbon Farming • “Recommendations” which should be put into place where appropriate. • “Standards” or the minimum requirements which must be met. • “Derogations” represent possible exceptions to a standard and the specific conditions under which they may be authorised. The Standard will also outline the practices and materials that are allowed, restricted or prohibited for use in order to be certified by NASAA as a Carbon Farmer. It will define the minimum conditions for certification under the Australian Carbon Farmers Trading scheme. The Standard will be subject to continuous upgrading and amendment as knowledge increases and the market matures. Collaborations with International Partners Carbon Farmers of Australia has developed relationships with like minded people in three countries: USA: The Carbon Coalition has a close relationship with the Carbon Farmers of America, which it helped form in October, 2006 in Vermont, USA. Carbon Farmers of America will be the beneficiaries of the work on Voluntary Standards in Australia. NZ: Carbon Farmers of Australia has formed a working partnership delegates to the Carbon Farming Expo & Conference42 from New Zealand establish Carbon farmers of New Zealand and leverage knowledge gathered in Australia. The two groups are responding to a request from the NZ Ministry for Agriculture and Forestry for proposals on the following: VOLUNTARY CARBON MARKET OPPORTUNITIES – SOIL CARBON MANAGEMENT IN NEW ZEALAND

42 The world’s first Carbon Farming Expo & Conference (Mudgee, November 16th-17th, 2007) was organised by the Carbon Coalition, the Central West and Lachlan CMAs, and the Australian Soil Science Society and attended by 400 delegates from all States of Australia and New Zealand.

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1.1. To develop a cost-effective and practical system that allows those undertaking cropland management and grazing land management activities to estimate/measure soil carbon changes on their land and sell voluntary carbon market offsets.

India: CFA is mentoring interests in India in particular the Society for the Improvement of Public Life & Environment as they establish Carbon Farmers of India.

Stage 3 Model – Full Value/Direct Measurement MMV The arrival of a robust model that measures soil carbon as accurately as is required to satisfy buyers. The emergence of a system such as Dr Christine Jones’s Australian Soil Carbon Accreditation Scheme would give members of Carbon Farmers of Australia the opportunity to increase their involvement in carbon farming. There will be different standards and requirements for such a system. Carbon Farmers of Australia is developing a methodology which uses the ‘statistical properties’ of flux to equalize it across a single plot, farm, district, etc.

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Key Factor #9: Gaining Farmer Engagement The Carbon Coalition contends that the most efficient means of gaining maximum uptake of mitigation measures on-farm is one that recognizes and responds to the unique personality-type that typifies the Australian farmer and grazier. As woolgrowers who live and work on a 1780 acre property on the Cudgegon River near Gulgong NSW, the nature of those who choose farming as a profession and vocation is well-known to us. From our observation they share the following universal values and norms:

Fierce independence – this is typical of small business proprietors. But they have to rely on their own ingenuity and each other for personal safety and business continuity as they work in a dangerous industry, subject to fire, disease, drought, flood, and commodity market prices. Distance from emergency and health services places family at risk.

Self-sufficiency – this was seen in the numbers of farmers who

refused to apply for income support or other government assistance in the current drought. Farmers detest the begging bowl mentality.

Pride in produce – they are growers because they like growing

primary produce. Few growers are not self-proclaimed experts in their field or commodity. They choose to endure the rigors of life mentioned above because of this pride and the environment and space the country affords them.

Driven by dollars – they follow markets and change enterprises

within parameters of capacities as the money dictates. They move from wool to fat lambs to cattle to crops with alacrity.

Don’t trust governments – There is a high level of cynicism about

politicians at party level (as opposed to their attitude towards the individual country MP who is usually a ‘good bloke’) that saw a 15% swing against the sitting member in the Parkes Electorate in the recent Federal Election.

These observations are augmented by the following findings:

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Trevor Webb, of the Bureau of Rural Sciences, identified the top seven factors that determine outcomes in programs that encourage shifting towards sustainable farming practices. 43They all involve perceived risk. • Financial viability: “Poor financial viability is a major constraint on the adoption of more sustainable farming practices that have limited productive advantage (Cary et al. 2002). ... Studies have generally linked higher levels of farm income with higher levels of practice adoption (Camboni and Napier 1993; Curtis and DeLacy 1998; Curtis and Van Nouhuys 1999; Saltiel et al. 1994; Witter et al. 1996).” This applies particularly where those practices do not deliver any efficiency or productive gains. • Financial advantage: “The perceived financial advantages of more sustainable agricultural practices have been shown to be one of the best indicators of their adoption.” Barr and Cary (1992) conclude that environmental innovations that were believed to be profitable were usually readily adopted, while those with a net financial cost were rarely adopted. … • Risk: Many Australian farmers are often motivated by a balance between the need for profit and a satisfaction with a comfortable living which minimizes risk and some will trade off profit maximisation for risk reduction (Howden et al. 1997; Marks and O’Keefe 1996; Reeve and Black 1993; Rendell et al. 1996). • Complexity: “More complex practices are less likely to be adopted.” (Vanclay and Lawrence 1995). • Compatibility: “ If a practice is not readily incorporated into a farming system then its adoption may be attenuated. Similarly if the ideas encompassing the new practice do not fit with local norms that will also work against adoption.” • Trialability: Practices which can be trialed on a small scale prior to full implementation are more likely to be adopted. Trialing reduces risk. 43 Dr Trevor Webb, “Understanding behaviour: Social and economic influences on land practice change, Bureau of Rural Sciences. Land management practices information priorities, classification and mapping – towards an agreed national approach. Kamberra Winery, Canberra 11-12 May 2004

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• Observability: More sustainable NRM practices whose advantages are observable are more likely to be adopted… Dr Webb concluded: “No single practice is likely to be widely applicable with high relative advantage to the landholder, low complexity, high compatibility, trialability and observability, and low risk.” His findings were supported by the conclusions of the National Land and Water Resources Audit in 200244: “Sustainable practices that provide economic and other advantages have lower risk, they are simpler tomanage and will generally be adopted more rapidly. Few natural resource management practices have all these characteristics...” “Low farm incomes and high debt are likely to discourage adoption of sustainable practices. Confidence in the stability of future farm incomes is likely to be associated with a greater capacity and willingness to invest in natural resource management.” “Recent research in Queensland suggests farmers are more likely to have a personality style adapted to perseverance, autonomy, solitude and a capacity to cope with adversity (Shrapnel &Davie 2000). Of 14 general personality styles expected in the wider community, farmers were found to generally fall into a limited suite of five styles. These five styles have a common tendency to experience discomfort in group situations. … Landcare is not necessarily the most effective means to inform or influence land managers or why group extension is, at best, one tool for delivering training on new farming techniques.” Conclusion: Farmers would respond best to the opportunity to earn an additional revenue stream, selling what they grow for a good price without depending on Government goodwill for ‘stewardship’ payments and that did not appear to be a big risk. The Carbon Coalition contends that Carbon Farming is the easiest way for a landholder to shift from emitting to sequestering, from degradation 44 Australian farmers: Relating to natural resource management National Land and Water Resources Audit, Commonwealth of Australia March 2002 http://www.anra.gov.au/topics/economics/pubs/national/anrm-report/farmers.html

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to restoration. Key Factor #10: Practical considerations The Carbon Coalition contends that most of the ‘difficulties’ identified by the Enquiry are minor matters easily resolved by reference to existing practices. Diffuse sources and sinks The aggregation of growers is an everyday reality in commodity marketing. Marketing Boards, Grain Desks, and Producer Groups are well understood by growers. Woolgrowers are setting up “demand chains” or “supply chain solutions for retailers”. Wool buyers or growers themselves aggregate the produce from enough growers to amass sufficient volume to meet the demand of a retail chain for wool of a certain specification so that it can be identified to consumers as a differentiated product.45 The diffuse sources and sinks argument ignores common practice. As well as the technology solution lurking in Environmental Management System (EMS). Environmental management systems are “that part of the overall management system which includes organizational structure, planning activities, responsibilities, practices, procedures, processes and resources for developing, implementing, achieving, reviewing and maintaining the environmental policy.”– ISO 14001, Environmental Management System Standard An EMS would enable the landholder to set their own ‘carbon farming’ goals and report progress. It could be linked to Local Catchment Authority for auditing, enabling decentralised reporting without the fear of Government “Big Brother” oversight. 45 Tasmanian Quality Wool Pty Ltd supplies 1000-2000 farm bales of Tasmanian 21 micron wool per year to German retail group Peter Hahn which uses Tasmania’s image, brand, lifestyle and environment to connect with European retail consumers. http://www.leadingsheep.com.au/story.asp?storyid=44

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A modified EMS would enable a “pool manager” to amass saleable quantities of produce and/or carbon. As it can be web-based, “buyers” and “sponsors” can log in and see volumes available. This issue is a red herring. Its proponents are ill-informed. Difficult to measure There is no difficulty in measuring soil carbon. If anything, our scientists are too good at it. They can measure it so well they can tell when it shifts by a molecule. The issue is not measurement. It is deciding which measurement to choose that we can agree represents the amount that a piece of land holds. Even if estimates at an individual level may be flawed, the error has typical “statistical properties” and aggregating many individual parcels will improve estimates. Both Drs Kimble and Lal have indicated that the solution lies in this direction.46 US scientists are questioning the importance of ‘flux’ and demanding that soil scientists come into the real world and find solutions:

Dr John Kimble: "It is often pointed out that soils have a large amount of variability, but with knowledge of soil sciences and landscapes, variability can be described and sampling protocols can be developed to deal with this," writes Dr John Kimble.47 "One reason I feel people say that soils vary and SOC cannot be measured is that we soil scientists focus on showing variability, not on showing what we know about the variability.” Dr Kimble recently retired from the US Department of Agriculture, National Resources Conservation Service, National Soil Survey Centre, Lincoln, Nebraska. "We too often focus on this [variability], worry about laboratory precision and field variation and do not look at the real world where most things are based on averages and estimated

46 See page 19 above. 47 Kimble, J., "Advances In Models To Measure Soil Carbon: Can Soil Carbon Really Be Measured?", in Lal, R., Cerri, C., Bernoux, M., Etchevers, J., and Cerri, E., eds., Carbon Sequestration in Soils in Latin America, Food Products Press, Birmingham, NY, 2006

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data. We tend to focus on finding variation and not on using our knowledge of soil science to describe what we know. All systems vary, but in soils we focus on a level of precision and accuracy that may not have any relevance to the real world because we can take so many samples and look at the variation."

Dr Rattan Lal: “While techniques of measuring concentration of C

in soils, methodologically sampled and carefully prepared for laboratory analysis, are well known, the principal challenge to soil scientists lies in: (i) upscaling the point data to landscape, farm, watershed or a region comprising 100,000-200,000 ha (ii) evaluating changes in soil C with reference to a baseline for cultivated land unit comprising a large farming community, and (iii) verifying that the C thus sequestered is permanent and not re-emitted because of changes in land use or management practices… Soil and tillage researchers must be pro-active in this important theme.”48

We have demonstrated that the uncertainty in soil carbon is merely an echo of the uncertainty in every other field of activity surrounding carbon accounting. (See discussion above on uncertainty in all areas associated with climate change. See discussion above about ‘flux’.) As the industry is capable of living with significant tolerances with fugitive emissions, forestry, etc. it must overcome its discomfort with soils. The Carbon Coalition contends that the fixation on constructing an ‘accounting system’ has led to a failure of proper strategic focus in this issue. 48 Dr Rattan Lal, “Farming Carbon”, Soil & Tillage Research 96 (2007) Dr Lal is Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food, Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award, World Congress of Soil Science 2006; President, American Soil Science Society

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Cost of MMV “The Cost of Measurement Monitoring and Verification may be so high as to make it uneconomic.” This objection is yet another red herring. If Australia’s 130,000 landholders were to bear the cost of soil mapping, baselining, and regular intense surveys and sampling and the price of CO2e remains less than $10tonne/ha/year, then this objection could have some merit. But the concept of cost per sample must be seen in context of a dynamic equation:

Bulk buying of soil carbon baselining and monitoring across such numbers would bring the cost per sample down to below $1 (according to Montana State University’s Associate Professor David Brown).

If the price of CO2e rises to $100/tonne – not unlikely given the

shortage of tradable carbon in the world and the absence to date of the three largest emitters, USA, China, and India, whose demand will drive the price of carbon –the cost of measurement becomes trivial.

The economic gains to be made by the nation in the value inherent in a

restored natural resource base should be included in the ROI equation. Researchers in NZ found that, while soil C is valuable for agricultural production, it is between 40 and 70 times more valuable to environmental protection. 49

The adoption of soil carbon scoring by the Commonwealth and State

Governments as the key performance indicator for a range of ecological improvements to be rewarded by stewardship payments is an efficiency practice: one KPI. Used for this function as well, would further offset the cost of measurement.

100 Year Rule The Kyoto Protocol was not set in stone. The first trading period was a dress rehearsal for the main event, starting in 2010. It was always to be seen as a proving period to learn how the cap and trade system would work.

49 Sparling, et. Al., 2006, quoted in Kimble et all, Soil Carbon Management, CRC Press, 2007

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The Members of the IPCC agreed that any member can bring suggestions for changes to the Protocols which bring the effort closer to achieving its goals.

As a technique which can be applied with most effect in the next 30 years, the Coalition suggests that the 100 Year Rule be set aside for soils and a 30 year rule be substituted.

The 100 Year Rule is inappropriate for soils because:

• Farmers do not like giving a legal right over their land for 100 years. (The experience of Landcare Carbon Smart is instructive.)

• Farmers are proud of what they have grown and the education they

received growing the carbon rich soil will make them disinclined to manage it in a carbon-emitting manner.

• Soil that has saturated with soil carbon is highly productive and drought resistant. It would be highly valued by any new owner.

If “Permanence” is still an issue after a lifetime of farming in a carbon rich environment – which will cause a dramatic cultural shift – the Government can consider stewardship payments for retaining high carbon scores. If every farm has a soil C score that is used as a single KPI for soil and ecology health, the direction of which score could determine the landholders’ access to government programs. Initial costs high Carbon Farming is a low input/low cost method of farming. One prominent member of the Carbon Coalition made a profit from his grazing enterprise every year in the last 4 years while all around him made losses. He did it by reducing his overheads and expanding his carbon farming activities. The cost of a soil carbon solution should be seen in context of the billions Australian Governments have spent trying to get Australian landholders to “care” and change their paradigm of relationship with the land. A futile endeavour.

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A fraction of the vast amounts of money absorbed by public sector infrastructures in pursuit of the unattainable would see soil C baselining completed for every landholder. Uptake by farmers Uptake by farmers was the origin of the dominant paradigm for change in any group in a society. In 1943, Iowa State College researchers plotted farmers adoption of a new hybrid corn seed. The bell curve they discovered is now the

standard adoption curve for new products and services. The adoption lifecycle model describes the adoption of an innovation, according to the demographic and psychological characteristics of defined groups. The process of adoption over time forms a normal distribution or "bell” curve. The demographic and psychological

profiles of each adoption group determined their behaviour: * innovators - had larger farms, were more educated, more prosperous and more risk-oriented * early adopters - younger, more educated, tended to be community leaders * early majority - more conservative but open to new ideas, active in community and influence to neighbours * late majority - older, less educated, fairly conservative and less socially active * laggards - very conservative, smalls farms and capital, oldest and least educated The Carbon Coalition contends that the best outcome will be achieved by offering landholders a range of alternatives that offers something for each:

Trading system 1: indicator/proxy system Trading system 2: direct measurement/full value Stewardship payments

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The introduction of the responsibility to account for total on farm emissions, including methane, would focus the mind of even the most isolated and disconnected landholder (laggard). The Bell Curve and the levels of risk landholders can tolerate could dictate the speed at which uptake takes place. When choosing a engagement model, it would be wise to consider the findings of several studies that have identified the reasons why the majority of farmers have not engaged with the Landcare model.50 Trade exposed industries The disadvantage suffered by producers who are required to account for on-farm emissions is real, but not automatic. Nor are producers powerless to address it. It is a disadvantage based on cost which affects pricing and profitability. Price is the only variable that separates pure commodities (ie. product offerings that are exactly the same). A pure commodity is a theoretical entity. In the real world there are no commodities (ie. products that have no differentiating attributes). There are only price-buyers, those who claim to consider no other attribute than price. And even these have some degree of discrimination, ie. specifications, suitability for purpose, etc. All products can be differentiated by some means: quality, delivery times, distribution arrangements, payment terms, style, product specifications, and country and region of origin. Differentiation is also possible on product dimensions such as “organic” “ethical” and “sustainable”. One method woolgrowers groups are developing to extract themselves from the “open call” auction method of selling wool is known as “demand chains” or “supply chain solutions for retailers”. Wool buyers or growers themselves aggregate the produce from enough growers to amass sufficient volume to meet the demand of a retail chain for wool of a certain specification so that it can be identified to consumers as a differentiated product.51 The product is expected to attract a premium for

50 See pages 37, 42, 47. 51 Tasmanian Quality Wool Pty Ltd supplies 1000-2000 farm bales of

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this reason alone. An attractive brand, based on a relevant product difference, can increase that premium price by a significant amount. Highly elastic consumer markets A ‘Brand’ can be built on the basis of one or a combination of attributes which are meaningful to buyers. This process of branding is available to producers required to account for their emissions. What appears as a disadvantage can be turned into a competitive advantage by turning a necessity into a virtue: ie., building a brand that exploits the producer’s emissions reduction. The “concerned Climate Change consumer” has already emerged in Europe and British retailers are requesting “carbon neutral” wool from Australian wool buyers.52 To meet this demand, at least two groups are working to build supply: The Merino Company (TMC), with its zeroCO2 brand, and Carbon Farmers of Australia, with its CarbonCredited™ brand. zeroCO2 The products bearing the Merino Company’s zeroCO2 swingtag are ‘proudly carbon neutral’ from day 1.53 “The farmers supplying the wool for ZeroCO2 products remove an equivalent quantity of carbon from the atmosphere to cover the entire production and lifecycle of the products.

Tasmanian 21 micron wool per year to German retail group Peter Hahn which uses Tasmania’s image, brand, lifestyle and environment to connect with European retail consumers. http://www.leadingsheep.com.au/story.asp?storyid=44 52 Marks & Spencer are seeking consignments of carbon neutral wool, (Personal communication with wool buyers.) The only thing holding all producers back is MMV. 53 This is a big ask, as the AGO has yet to anoint a woolgrowers’ calculator to calculate the likely methane emissions

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Third party accreditation is used for both the garment lifecycle analysis, and on farm carbon balancing,” says TMC. For ZeroCO2 wool products to have a zero carbon footprint for their entire lifecycle, TMC have their growers join the Landcare CarbonSmart Native Vegetation Program, which pays c.$9/tonne CO2e for existing stands of trees that must be maintained for 100 years. There are no public reports about the success of either program, although these are early days, CarbonSmart launching in March 2007 and zeroCO2e even later.54 But contact with growers reveals that the 100 year rule is highly unpopular, and the amounts on offer could be too small to encourage farmers will take risk in areas they do not understand. The TMC program could have the same problem. Too much could be asked of the grower: they must offset all emissions from all companies in the chain, including processing, manufacturing, and transport. And they must do it with the CarbonSmart product and a 10% premium for their product. Including their Methane emissions. If the price received for wool in the past 5 years is the base for calculation, the proposition is not attractive.55 The low appeal of these programs (and we have no statistical evidence of this) has its origins in the program designers’ desire to satisfy the carbon accounting rules, which was greater than their desire to change grower behaviour. (It should be noted that woolgrowers are being asked to offset the entire emissions from their production, processing, manufacturing and distribution when major banks – such as Westpac – who make great milage out of their sponsorship of CarbonSmart or their awards for reporting their emissions, may or may not be planning to go carbon neutral for many year. It’s target is prominent because of its absence. The NAB reported it would be neutral 2 years from now. Westpac managed to make its 2005 annual report neutral.)56

55 The habit commentators have of ratcheting up Agriculture’s contribution to Australia’s emissions by adding its “Scope 2” standing energy and transport emissions is a sleight of hand. If these two polluting industries are allowed to offload their emissions onto their customers, where will their liability lie? 56 Last week, the National Australia Bank said it would go carbon neutral within three years, and Westpac says it has reduced its emissions by 40 per cent The Age, 8, 2007

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CarbonCredited While zeroCO2 is for wool only, the CarbonCredited program covers all commodities. The fundamental principle governing involvement in this program is participation in a GHG emissions reduction process – with targets and standards and auditing to confirm the performance. The Australian Greenhouse Office has agreed to use “Uamby” as a case study for agricultural businesses in the Greenhouse Challenge Plus, which forms the basis of the CarbonCredited process. Emissions reductions strategies include he use of Planned Grazing to ensure a supply of fresh grass (reducing methane emissions), Pasture Cropping to reduce soil disturbance (and methane emissions), Natural Fertilisers to replace nitrogenous fertlisers (reducing nitrous oxide), Tree Plantings (to offset emissions) and Natural Vegetation Regeneration (as well). Stock numbers would be slightly reduced once genetics were available for low emission sheep. However stock density is an essential tool in Pasture Management. To keep track of emissions performance, and to provide an accounting system for carbon trading we are adapting an existing Environmental Management System (EMS) to our own ends Environmental management systems are “that part of the overall management system which includes organizational structure, planning activities, responsibilities, practices, procedures, processes and resources for developing, implementing, achieving, reviewing and maintaining the environmental policy.”– ISO 14001, Environmental Management System Standard The average landholder has no motivation to introduce EMS system. A minority of between 10% and 35% are engaged in Landcare and are committed to the environment. Surviving everyday with declining terms of trade and a disintegrating resource base, it takes an unusual incentive to change behaviour which is driven by survival and the need for revenue. The Missing Link in all Taxpayer Funded programs for agriculture: The Profit Motive. The Ideal System: Farmers rewarded by a market for what they grow, not for meeting government benchmarks or targets. Our choice of EMS partner is the Australian Landcare Management System (ALMS), which has an environmental/government policy focus.

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It is an externally audited Australian land management system, based on the internationally accepted ISO 14001 environment management standards. It considers catchment priorities and requirements for biodiversity conservation. To earn the right to use the ‘CarbonCredited” swingtag on their products, Carbon Farmers agree to be part of a GHC+“Cooperative Agreement” under which they commit to achieving Best Practice reducing emissions on Farm to achieve “carbon neutral” status in stages. The agreement they sign says each individual property“undertakes to put in place appropriate, practical and cost-effective actions to reduce its own greenhouse gas emissions and to encourage its staff and other external stakeholders to implement their own actions.” A proactive, aggressive, price-making approach to marketing can overcome the disability of competing against growers from markets unencumbered by emissions abatement or making margins with consumers when they see us as “price-takers” Australia’s farmers can hold their own when it comes to net emissions /net sequestering if they are given access to the soil carbon they sequester and the right to differentiate their product in the marketplace. Key factor #11 Carbon Farming and Adaptation to Climate Change Climate Change is expected to mean the following for Australian landscapes:

1. General increases in temperatures – hotter summers, warmer winters

2. Less rainfall particularly in the south during winter and spring 3. Increased frequency of dry seasons 4. Increased evo-transpiration 5. Greater frequency and intensity of extreme weather events 6. Reduced flows in inland waterways.

The Carbon Coalition contends that increasing soil carbon levels and the processes required to do this are an effective strategy for adapting to and compensating for these conditions. Increasing soil carbon levels in the 450m Ha of agricultural soils in Australia and the 5.5bn Ha of agricultural soils in the world is also an

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effective strategy for absorbing excess CO2 from the atmosphere and reducing the severity of Climate Change. What is Soil Carbon? Soil Carbon is one of the many resting places of Carbon as it cycles throughout the biosphere (the liveable area on the planet). Carbon is the basic chemical building block of all life on Earth. It also resides in mineral form in rock formations and in fossil fuels, coal and oil as well as in the ocean. The amount of Carbon on Earth is fixed. So the many processes that use it need to access a supply of it and have somewhere to get rid of it. The result is a cycle as Carbon moves between the oceans, rocks, soil, and atmosphere. There are 33,000 Gigatonnes (Gt) of carbon stored in the oceans, 2500 Gt/C in soil, 750gt/C in the atmosphere, and 650 Gt/C in forests, grasslands, and other vegetation. (The “Greenhouse” effect is caused by the cycle getting out of balance, resulting in the atmosphere housing more on a rolling basis than it was designed to hold in order to manage stable weather patterns.) Photosynthesis is a process that cycles Carbon out of the air and into plants, to be eaten by animals and humans as well as being deposited in soils. Photosynthesis is the only process that can take CO2 out of the atmosphere. It separates the C atom from the O atoms, releasing the Oxygen and incorporates the C in the plant, or transfers it to the soil where it becomes humus or other forms of Carbon. Some of it is released into the air if plants die and oxidize or dry out, or rot, releasing C in the form of methane. Soil Carbon takes two main forms: 1. All the decomposed bodies of microbes such as bacteria, fungus, nematodes and root systems that die when plants are grazed as well as other decomposed plant residues. These forms of Carbon can be cycled quickly, within weeks. 2. The Carbon which is incorporated into the soil itself, such as humus. In these forms it can remain stable for thousands of years. Total Organic Carbon is the amount of C stored in the soil of whatever type, source, or location. It can be measured very accurately. While soil carbon is subject to “flux” – different amounts can be measured according to time of day, time of year, and weather conditions –

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averaging techniques make assessing the amount of increase or decrease in soil C percentage possible. The Benefits of Soil Carbon Soil carbon improves the fertility and health of soil which is the source of life. Soil carbon increases soil’s ability to transfer nutrients to plants, for greater productivity which can improve farmers’ incomes. Soil carbon increases soil’s water-holding capacity, holding the water until it can be used by the plants rather than letting it run off into waterways. Soil carbon increases soil stability which means greater resistance to erosion, which in turn means cleaner waterways. Soil carbon effect on soil’s ability to hold water reduces recharge to groundwater and can reduce or eliminate salination

A nation’s most precious resource “The soil organic carbon (SOC) pool is an important indicator of soil quality, and has numerous direct and indirect impacts on it. For example, increase in SOC pool in degraded soils improves soil structure and tilth, reduces soil erosion, increases plant available water capacity, stores plant nutrients, provides energy for soil fauna, purifies water, denatures pollutants, increases soil biodiversity, improves crop/biomass yields, and moderates climate. It makes soil a living ecosystem. Indeed it is a nation’s most precious resource.” Dr Rattan Lal, “Farming Carbon”, Soil & Tillage Research 96 (2007) Dr Lal is Director, Carbon Management and Sequestration Center, Ohio State University, Columbus, Ohio; Professor of Soil Science, College of Food, Agricultural, and Environmental Sciences, School of Natural Resources, Ohio State University; Liebig Applied Soil Science Award, World Congress of Soil Science 2006; President, American Soil Science Society

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Soil carbon also has a direct relationship with biodiversity: soil organic matter contributes to the health of soil microbial ‘wildlife’ and micro-flora which are the very start of the food chain. Greater diversity at this level translates into greater diversity above and below the ground. Carbon is a major component of soil and catchment health. Soil Carbon and Natural Resource Management The greatest interaction between Humanity and Nature takes place in the field of Agriculture. Farmers control around 65% of the terrestrial surface of the Earth. The land management approach they take has a profound effect on the natural resource base. Traditional European farming practices were not sympathetic to conditions in the Southern Hemisphere and the result has been losses of productive resources. Eg. Australia is said to have lost at least 50% of its topsoil and that soil has lost 70% of its organic matter in 200 years. There are two theories for restoring the natural resource base to health:

1. Remove stock and lock it up. 2. Move stock and build it up.

The first theory is popular with those who believe in the possibility of returning to an ‘arcadian past’ when everything was ‘native’ to the environment. But which past and which environment? Tim Flannery in The Future Eaters revealed that the first human invasion of the continent of Australia dramatically changed the flora and fauna by the farming techniques employed. “Firestick farming” by Indigenous people burnt many species of plant to extinction and hunting saw the disappearance of the megafauna. However, some commentators claim that, prior to 1770, this race of farmers lived in a way that was more sympathetic to the landscape. But which landscape? They were not sympathetic to the landscape they found when they arrived 40,000 years before white settlers. However they lived in harmony with the landscape as they had changed it to suit their practices. They achieved a state of sustainability. But only after a period of disruption.

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In following the pattern set by their Indigenous forerunners, White European settlers are still in the disruption stage of their occupation. And now they are seeking to achieve a state of sustainability. Returning to the state of balance that existed in 1770 is not possible. A new state of balance must be sought, that is sympathetic to the natural resource base. Locking up land and removing stock can lead to ‘bare earth’ and desertification because it ignores the symbiotic relationship between plants and animals. Native grasslands – which covered vast areas of Australia in 1770 – need to be grazed and disturbed by stock, then given time to recover, in order for the mechanism of soil carbon manufacture to operate. Grasses left to go rank “oxidize” (emit Carbon) as they dry out and their shadows keep the sun away from new shoots. Consequently groundcover reduces. And deserts begin.57 Instead, a new sustainability which includes increased biodiversity and native species can be achieved by the change to Carbon Farming. Carbon Farmers report increases in species of insects, birds, marsupials, and lizards as well as increase numbers of species of native plants as they transition to the new way of farming. Allan Savory, winner of the 2003 Banksia Environmental Award, discovered the symbiotic relationship between grazing animals and native grasses. The key to increasing soil carbon is biological activity in top soil. Soil carbon is created by insects and microbes living and dying. They do a lot of living and dying when there is a lot of root activity in the soil – vigorous growth and regular decaying of rootmass. Roots that are continually reaching down deep into the soil and then 57 Allan Savory is a wildlife biologist and founding director of the Savory Center for Holistic Management in Albuquerque, New Mexico. The Zimbabwe-born scientist has won international acclaim for his innovative methods to reverse desertification, now being used successfully around the world. In 2003 he received the Australian Banksia International Award for the person or organization doing the most for the environment on a global scale. Allan’s book, Holistic Management: A New Framework for Decision Making, Island Press 1999, is today in use in a number of colleges and universities.

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dying back and retreating. Their rotting remnants feed the microbes which produce the soil organic carbon. This activity is encourage when the plant is grazed, but not entirely, then disturbed and fertilized by the action of grazing animals, and then given a lengthy time to recover its foliage. With this recovery comes the recovery of rootmass and so the cycle goes on. Savory invented a grazing management system to encourage this activity. By “moving” the stock in concentrated groups relatively quickly through a large number of small paddocks, grazing management encourages the growth of plants, soil and soil carbon. Grazing management is one of the fundamental techniques that make up a new approach to agricultural landscape management known as Carbon Farming. Carbon Farming and Climate Change Scientists now believe that Carbon Farming can reduce CO2 in the atmosphere fast enough to avert the very worst consequences of Global Warming.58

58 . Lal, Dr. Rattan, “Farming Carbon”, Soil & Tillage Research, (6 (2007); “soil Science and the Carbon Civilization”, SSSAJ Vol 71 No. 5 Sept-Oct 2007; “Soil Carbon Sequestration Impacts on Global Climate Change and Food Security”, Science, Vol 304, 11 June, 2004. Dr Lal is President of the American Soil Science Society.

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Key Factor 12: Support for the Carbon Coalition’s Submission SENIOR GOVERNMENT SOIL SCIENTIST “I support to the activities of the Carbon Coalition such as holding forums where the scientists and farmers and carbon traders get together. I think the advantage of the Coalition from my perpective is that it has helped open the lines of communication between the farming, science, and trading communities. This has cleared up many misunderstandings that were originally present. I think it is a great initiative.” Dr Brian Murphy Senior Natural Resource Officer NSW Department of Environment and Climate Change PO Box 445, Cowra NSW, Australia 2794 *Dr Brian Murphy is a senior soil scientist and has wide experience in soil mapping and soil classification and in research and advisory roles on the effectives of land management on soils. He was a lead author of reports published by the Australian Greenhouse Office as part of the National Carbon Accounting Scheme.

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AUTHOR AND POLITICAL ACTIVIST "The Carbon Coalition Against Global Warming has impressed me with its expertise, commitment and energy in pursuit of the goal of soil carbon trading. As the co-founder of Climate Change Coalition and a candidate for election to Australia's Senate, I chose the Carbon Coalition as an important source of policy on agriculture. As a grazier and olive grower, I am currently practicing what the Coalition calls "Carbon Farming" and I believe that soil C credits could be the catalyst for the rapid uptake of progressive land management practices among normally conservative farmers." Patrice Newell is the author of three books, The Olive Grove, the River, Ten Thousand Acres. A founding member of the Hunter Valley Olive Growers' Association, president of The Upper Hunter Waterkeeper's Alliance, a certified biodynamic beef producer, and a well-known campaigner for sustainability. Patrice Newell Elmswood, Gundy NSW 2337 Farm: 02 6545 8192 Mobile: 0417 231822 email: patricenewell@ozemail.com.au

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INTERNATIONAL MEMBERS OF COALITION "The Carbon Coalition Against Global Warming have demonstrated leadership and vision in the field of soil carbon sequestration. Their tireless work in advancing the practice and promotion of carbon capture in soils is widely recognized in the United States. We look to a future in which government, business and the CarbonFarmers of the World have fully cooperated in restoring agricultural productivity, rural prosperity, clean water supply and climatic stability. This future is closer than many know, and the Carbon Coalition Against Global Warming is playing a pivotal leadership role in taking us all there. Carbon Farmers of America is proud to be a member of the Carbon Coalition Against Global Warming." Abe Collins, Co-Founder, Carbon Farmers of America *Abe Collins is a pioneer educator and thinker in the field of regenerative agriculture. He is a Co-Founder of Carbon Farmers of America, a rapidly growing farmer-owned soil carbon aggregator.

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GLOBAL LEADER IN REGENERATIVE AGRICULTURE “I endorse the work of the Carbon Coalition Against Global Warming because these farmers and ranchers address the root cause of Australia's degraded grasslands currently contributing to global climate change. Restoring grasslands to health, through Holistic Management, changes grassland soils from net emitters of carbon to the role of vast carbon storehouse they formerly played. A safe and natural role and place for permanent carbon storage. Because the fate of both carbon and water in the soil are tied to soil organic matter, reversing grassland degradation also restores healthy water cycle functioning which in turn decreases both drought and flood frequency and severity – something Australia sorely needs. The Coalition’s leadership team all have Holistic Management training and practical experience that is already demonstrating the power of determined people managing holistically to reverse land degradation (desertification) which is vital to the future of Australia and global civilization. I encourage the government of Australia to look towards a new paradigm in grazing land management to reverse the results of past mistakes and chart a new future for our depleted natural resource base. Allan Savory Founder Holistic Management International Albuquerque, New Mexico www.holisticmanagement.org Chairman and Founder Africa Centre for Holistic Management Victoria Falls, Zimbabwe. *Allan Savory is a wildlife biologist and founding director of Holistic Management International in Albuquerque, New Mexico. He is also the founder and Chairman of the Africa Centre for Holistic Management, Victoria Falls, Zimbabwe. The Zimbabwe-born scientist has won international acclaim for his innovative methods to reverse desertification, now being used successfully around the world. In 2003 he received the Australian Banksia International Award for the person or organization doing the most for the environment on a global scale. Allan’s book, Holistic Management: A New Framework for Decision Making, Island Press 1999, is today in use in a number of colleges and universities and the governments of both the U.S. and Mexico have trained Holistic Management extension personnel.

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GLOBAL LEADER AND SOIL TECHNOLOGY PIONEER BEST Energies would like to support your submission to the Garnaut Review as we feel that soil carbon sequestration must play a role if the global population is going to meet the greenhouse challenge. The huge potential of agricultural soils to sequester carbon on a climate changing scale can not be ignored and frameworks for facilitating new management practices need immediate implementation. We are encouraged by the many ‘Carbon Farmers’ you are associated with whose commitment to achieving climate change mitigation along with agricultural sustainability goals is commendable. We believe that innovative land management practices offer a solution that is here and now and in working with the natural carbon cycle are a low risk sequestration option. The most promising aspect of increasing soil carbon levels is that it can sequester carbon whilst adding value down the chain. Farmers are motivated to put carbon back into their soils as they realise the associated improvements in soil health results in increased productivity and hence sustainability for their operations. A win-win situation. We thank you for your tireless efforts in promoting this cause, and wish you every success in increasing soil carbon levels. Regards, Robert Downie Managing Director Best Energies* *Best Energies is Australia’s pioneer of biochar technologies, currently engaged in trials of this promising soil ameliorant technology. “I think this is one of the most exciting and important new technologies out there, in terms of stabilising our climate” Prof. Tim Flannery On Pyrolysis and Agrichar production. May 2007

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CORPORATE LEADER, AGRICULTURALIST AND DECISION MAKING EXPERT As Asia Pacific's largest manager of commercial real-estate, we and our clients have benefited from the innovative solutions and practical advice that the Carbon Coalition has been able to propose. Buildings in Asia account for upwards of 40% of all greenhouse emissions. Carbon trading, and in particular soil trading, offers Australia a unique opportunity to not only be part of the solution, but to also positively influence farming practice and agricultural sustainability. I support the Carbon Coalition’s initiatives in respect of soil trading. We are already working with building owners all over Asia to design and operate more sustainable buildings and I look forward to a timely introduction of soil trading, a new resource that our clients can utilize to help them do their part in turning around the major issue facing the world today. Peter Barge CEO Jones Lang LaSalle Asia Pacific 14,000 staff, 72 offices. *Peter Barge has a unique perspective: as CEO of the largest property agency in Asia Pacific he is privy to the strategic planning concerns of corporate leaders throughout the region. As a hands-on farmer, he has a deep understanding of climate issues. Peter is an innovator, both in the city and the country. And as author of “The Little Book of Big Decisions”, he also understands the powerful way that the ‘framing’ of a question can determine the outcome of decision-making processes.

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Conclusion The outcome of the debate could determine the severity of the climate crisis and the fate of millions in years to come. Or it could have no influence on events at all. Such is the uncertainty and ambiguity that has haunted the Climate Change issue since it emerged. To guide the decision-maker through the uncertainty to understand the risks arising from the options, we offer a 4-cell matrix: On one axis we have ACTION: Yes or No. One the other axis we have IMPACT: Great or Minimal.

The Soil C Dilemma: Risks and Rewards

The Soil C dilemma is ‘to act or not to act’, given its great promise, despite the uncertainty. The risks associated with each option can be

revealed by this matrix. OPTION A: If a market that rewards landholders for Soil C Sequestration is allowed to proceed at a level which engaged a critical mass of farmers (50+%), vast tonnages of CO2e could be absorbed within the 10 year time span the Stern Report gives us to act and the worst excesses of climate change could be avoided. A large number of farmers will be trained in regenerative carbon farming techniques; farm landscapes will be restored an their ecologies enjoying deeper, richer biodiversity of species in soil microflora and fauna, native grasses and shrubs and trees, insect and birdlife, and small and larger mammals.

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OPTION B: IF Soil C Sequestration is sidelined until it meets the approval of the greenhouse accountants, it will certainly be too late to have a significant impact on the trajectory of the future. Doomsday scenarios may be too dramatic. And they may not. OPTION C: If farmers are allowed to sell their carbon, and they don’t grow any, the “loss” would be the cost of baselining soil carbon for 130,000 properties across Australia. This is not necessarily a loss. It can be an investment in sustainable land management. OPTION D: No action, no investment, no bad news. Good bet. Soil Carbon is an insurance policy.

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Appendix 1 Limitations of NCAS data 1 __________________________________________________________ From “The Impact of Tillage On Changes in Soil carbon Density with Special Emphasis on Australian Conditions”, National Carbon Accounting System Technical Report No. 43, Australian Greenhouse Office, January 2005 __________________________________________________________ “In many instances the reviewed studies lacked important information necessary to evaluate changes in soil carbon... Specific information that was frequently missing and did not allow a full account of changes in soil carbon density from the examined trials. a. Lack of information on plant biomasses in years preceding the cropping phase of a trial. Ideally years since clearing and the phase in the crop/pasture rotation should be identified. A legume phase in the crop may have better nutrient levels and so better biomass production. b. The exact timing of burning of stubble is frequently not given. This is important as it determines how long the surface soil is protected by stubble cover and for how long the stubble is available for biological breakdown. c. Information about the amount of stubble present in a cropping rotation was not presented in many studies. Stubble quantities will impact on soil carbon levels in the medium to longer terms, and therefore need to be considered when evaluating the effect particular management practices have on carbon stocks. d. The grazing intensity and duration of stubble between crops. This can infl uence the amount of time that stubble will protect the soil surface and the amount of stubble available for biological breakdown. e. Identification of the degree of soil disturbance before and during sowing. f. Details of fertiliser application. g. Frequently only minimal information is given on the grazing intensities and biomass levels in the pasture phases between cropping phases. h. Soil conditions (physically and chemically) are often not stated at the commencement of the trial...

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Appendix 1 Limitations of NCAS data 2 __________________________________________________________ From “Estimation of Changes in Soil Carbon due to Changed Land Use National Carbon Accounting System - Technical Report No. 2 November 1999 ________________________________________________________ “There are a number of significant limitations in the paired site datasets. These include: • Very few of the datasets have soil carbon data from below 20 cm depth in the soil profile. • Only one dataset had information on soil carbon pools. • Few of the reported data account for bulk density in calculations of C in the soil profile. Without the bulk density profile, it is not possible to correctly calculate the soil C stock per unit land area. • Criteria used for identifying paired sites or verifying that they may be paired sites are usually not explicitly defined… • Many of the datasets do not have accurate information on date and method of clearing and development, land use history … land management practices and changes through time. • Some datasets lack accurate site location data. • Many of the datasets relate to sites that areno longer available or for which land use and land management details are not readily available.. • There are very few sites in the main areas of recent clearing…

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Appendix 2: Carbon Farming Carbon Farming is not a new practice. It is a new way to describe a collection of techniques which can increase soil organic carbon in agricultural land. Land management practices that encourage healthy, growing soil microbial communities and, in so doing, create soil organic carbon and strengthen the natural resource base, include the following: 100% groundcover 100% of the time - This is a Carbon Farmer’s goal. Soil covered by plants cannot be blown or washed away. It is cooler and more attractive to microbes than if it was exposed to the sun. Therefore over-grazing (“flogging the land”, in Australian parlance) and burning grasses and stubble and ploughing are anti-carbon actions. In fact, they release tonnes of carbon into the atmosphere. These practices, along with clearing native vegetation, have put Agriculture in 2nd place, behind coal-burning power stations, as the biggest source of Australia’s Greenhouse Gas emissions. Grazing management – Stock are concentrated in small paddocks for short periods (days) so that they graze evenly and at the same time ‘til’ the soil with their hooves, stomping old grass and manure into it. The plants are then left to grow a full head of foliage so that their roots go down as far as possible into the soil. When they are grazed, the roots die back upwards in proportion to how much of the foliage was eaten. Overgrazing can cause the roots to shrink so short they struggle to get started again. So short grazing periods and long periods of rest are best. No till cropping – Ploughing disturbs the microbes and dries out the soil. It also releases tonnes of CO2 per hectare. ‘No til’ techniques sow the seed in the top soil without tearing off the existing foliage or applying herbicides which are also bad for microbes. There are several no till techniques, including “Pasture Cropping” and “Advanced Sowing”. The one ‘direct drills’ the seed into pasture while the other slices a line through the pasture and inserts the seed. The crop grows up above the pasture and can be harvested or grazed. The pasture usually thickens and grows more vigorously after such treatment. Mulching – This takes two forms: 1. Covering bare earth with hay or dead vegetation. This protects the soil from the sun, cools it, and attracts

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soil-producing microbes. It also holds water where it can be used instead of letting it run off immediately. 2. Cutting down and dessicating tall, dead plants and thistles to form a layer of litter on the soil and allow the sun to penetrate and foster plant growth. Gardeners know the value of mulching. Water management systems – Water is essential to the carbon growing process. Several systems have emerged for maximising us of water that falls on a farm. Two names are prominent: Natural Sequence Farming (NSF) and Yeoman’s Keyline System. NSF slows the flow of water through the landscape by returning eroded gulleys and creeks to swampy meadows and chains of ponds that they were when white settlers arrived. The water stays long enough to make more grass and plants grow, rather than rushing down widening gullies carrying the topsoil away. NSF is based on the natural topography of the land. So is Keyline planning. It uses the shape of the land to determine the layout and position of farm dams, irrigation areas, roads, fences, farm buildings and tree lines. Both methods increase soil fertility and carbon Biodynamics – This is a method of treating soil, based on the theories of mystic and theorist Rudolf Steiner. He postulated that vital forces or energies flowed throughout the universe and that these can be harnessed to increase plant growth. Biodynamics adopts a homeopathic approach to preparing natural fertiliser and times activities to align with cycles of the moon and the stars. Many ordinary, sober farmers report great results with biodynamic preparations Biological Farming – This is the umbrella term for the use of natural compounds to stimulate biological activity in the soil. These compounds range from compost teas (concocted after an analysis of the soil for deficiencies), worm ‘juice’ (active enzymes created from worm castings), Biosolids (human effluent which needs to be plowed into the soil for hygene and odour reasons (not a favourite of carbon farmers), Nitrohumus (treated human effluent, needs no ploughing) etc. Composting - This largely involves breaking down manure into a rich humus ready to spread on the fields. There is also a growing movement for recycling green wastes from cities for use on agricultural lands. Trees – Trees scattered across grasslands (“Grassy woodlands”) provide shelter for stock and wildlife and also have the effect of causing the soil adjacent to be richer in carbon. They can also assist in the management of water movement. And they contribute directly to increase yields and

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productivity in both livestock and crops, with reported increases of between 20% and 40%. (3) It has three active ingredients:

1. soil carbon as a key performance indicator of restoration of soil health, salinity, soil structure, biodiversity and ecological resilience, and as a catalyst for renovating rural landscapes and farm family prosperity and eventually rural communities;

2. methane emissions reduction by pasture management and genetics

rather than artificial inoculants; and

3. reduction of nitrous oxide emissions through the adoption of natural processes and biological fertilisers to replace nitrogenous fertilisers.

The principles on which Carbon Farming is built are:

• Sustainable profit – Carbon Farming is low input farming. Instead of expensive artificial fertilises, herbicides and pesticides, it uses low cost natural processes. It builds resilience and productivity into the natural resource base. And the possibility of earning carbon credits can underwrite a revolution in agricultural land management by supplying the motivation.

• Land Ethic - Agriculture is the greatest interface between humanity

and nature. The “Land Ethic” holds that man is a member of an ecological community whose members rely upon the health of the others for their own health.

• Food security – No nation can afford to outsource agriculture for

reasons of national security.

• Symbiosis of plants and animals – Native pasture grasses need the regular harvesting, disturbance and fertilisation by animal impact

• Vegetation dynamics – For 40,000 years, trees in the landscape

have been in dynamic relationship with humans, animals and grasses. Both Indigenous and European agriculture involved managing regrowth to encourage productive use of pastures.

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The values of native species ecology can form the basis of a new agriculture that benefits all members of the community of living organisms including flora and fauna. It must acknowledge the importance of harnessing natural processes in agricultural production and the critical role of the farmer as a ‘grower’. The requests of the Carbon Coalition for Government action – carried resoundingly at the Carbon Farming Conference at Mudgee on 16th-17th November 2007 – are these:

1. Immediate release of $10m for scientific studies to verify findings of growers that Australian soils can sequester significant volumes of carbon, given the right inputs and practices.

2. That every farmer should know their baseline soil carbon score and that access to government support programs be predicated on the direction of that score.

3. That the Federal Government introduce a national program which supplies the carbon testing services to growers at no or low cost (achieved by volume discounts from suppliers).

4. That all institutional and artificial barriers be removed from the emergence of a market for soil carbon.

5. That panels of scientists and farmers be used to guide the formulation of methodology for experiments which purport to represent on farm conditions and to oversee the interpretation of results so that fundamental misinterpretations do not result in policy detrimental to the agricultural sector.

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FOOTNOTES: 1. Dr Christine Jones,, “Aggregate or aggravate? Creating soil Carbon”, YLAD Living Soils Seminars: February 2006 2. There are cities and towns and villages, whole societies living down under the soil. They are connected by highways and contain millions of creatures just trying to make a living, from one-celled bacteria, algae, fungi, and protozoa, to nematodes and tiny microscopic spiders, to earthworms, insects, and ants. Dr Jill Clapperton, “Managing the Soil as A Habitat,” Canadian Rhizosphere Ecologist, South Australian No Till Farmers’ Association Conference, February 2007. 3. Gillespie, R. (2000) Economic Values of Native Vegetation, Background Paper Number 4, Native Vegetation Advisory Council, Sydney. Lockwood, M., Walpole, S.C. and Miles, C.A. (2000), Economics of remnant native vegetation conservation on private property, LWRRDC Research Report 2/00, LWWRDC, Canberra. Miles, C.A., Lockwood, M. Walpole, S., Buckley, E. (1998) Assessment of the on-farm economic values of remnant native vegetation. Johnstone Centre Report No. 107. Johnstone Centre, Albury. Walpole, S.C. (1999), Assessment of the economic and ecological impacts of remnant vegetation on pasture productivity, Pacific Conservation Biology, 5: 28-35

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Appendix 3: Uncertainty and the GHG Protocol http://www.ghgprotocol.org/ “Preparing a GHG inventory is inherently both an accounting and a scientific exercise. Most application for company-level emissions and removal estimates require that these data be reported in a format similar to financial accounting data. In financial accounting, it is standard practice to report individual point estimates (i.e., single value versus a range of possible values). In contrast, the standard practice for most scientific studies of GHG and other emissions is to report quantitative data with estimated error bounds (i.e., uncertainty).

“Just like financial figures in a profit and loss or bank account statement, point estimates in a corporate emission inventory have obvious uses. However, how would or should the addition of some quantitative measure of uncertainty to an emission inventory be used? In an ideal situation, in which a company had perfect quantitative information on the uncertainty of its emission estimates at all levels, the primary use of this information would almost certainly be comparative.

“Such comparisons might be made across companies, across business units, across source categories, or through time. In this situation, inventory estimates could even be rated or discounted based on their quality quantitative metric for quality. Unfortunately, such objective uncertainty estimates rarely exist.

“Uncertainties associated with GHG inventories can be broadly categorized into scientific uncertainty and estimation uncertainty. Scientific uncertainty arises when the science of the actual emission and/or removal process is not completely understood. For example, many direct and indirect factors associated with global warming potential (GWP) values that are used to combine emission estimates for various GHGs involve significant scientific uncertainty. Analyzing and quantifying such scientific uncertainty is extremely problematic and is likely to be beyond the capacity of most company inventory programs.

Estimation uncertainty arises any time GHG emissions are quantified. Therefore all emissions or removal estimates are associated with estimation uncertainty. Estimation uncertainty can be further classified into two types: model uncertainty and parameter uncertainty.3 Model uncertainty refers to the uncertainty associated with the mathematical equations (i.e., models) used to characterize the relationships between various parameters and emission processes. For example, model

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uncertainty may arise either due to the use of an incorrect mathematical model or inappropriate input into the model. As with scientific uncertainty, estimating model uncertainty is likely to be beyond most company’s inventory efforts; however, some companies may wish to utilize their unique scientific and engineering expertise to evaluate the uncertainty in their emission estimation models.

Parameter uncertainty refers to the uncertainty associated with quantifying the parameters used as inputs (e.g., activity data and emission factors) into estimation models. Parameter uncertainties can be evaluated through statistical analysis, measurement equipment precision determinations, and expert judgment. Quantifying parameter uncertainties and then estimating source category uncertainties based on these parameter uncertainties will be the primary focus of companies that choose to investigate the uncertainty in their emission inventories.

Given that only parameter uncertainties are within the feasible scope of most companies, uncertainty estimates for corporate GHG inventories will, of necessity, be imperfect. Complete and robust sample data will not always be available to assess the statistical uncertainty4 in every parameter. For most parameters (e.g., liters of gasoline purchased or tonnes of limestone consumed), only a single data point may be available. In some cases, companies can utilize instrument precision or calibration information to inform their assessment of statistical uncertainty. However, to quantify some of the systematic uncertainties5 associated with parameters and to supplement statistical uncertainty estimates, companies will usually have to rely on expert judgment.6 The problem with expert judgment, though, is that it is difficult to obtain in a comparable (i.e., unbiased) and consistent manner across parameters, source categories, or companies. For these reasons, almost all comprehensive estimates of uncertainty for GHG inventories will be not only imperfect but also have a subjective component and, despite the most thorough efforts, are themselves considered highly uncertain. In most cases, uncertainty estimates cannot be interpreted as an objective measure of quality. Nor can they be used to compare the quality of emission estimates between source categories or companies.

... Reductions in indirect emissions (changes in scope 2 or 3 emissions over time) may not always capture the actual emissions reduction accurately. This is because there is not always a direct cause-effect relationship between the activity of the reporting company and the resulting GHG emissions. For example, a reduction in air travel would reduce a

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company’s scope 3 emissions. This reduction is usually quantified based on an average emission factor of fuel use per passenger. However, how this reduction actually translates into a change in GHG emissions to the atmosphere would depend on a number of factors, including whether another person takes the “empty seat” or whether this unused seat contributes to reduced air traffic over the longer term. Similarly, reductions in scope 2 emissions calculated with an average grid emissions factor may over- or underestimate the actual reduction depending on the nature of the grid. Generally, as long as the accounting of indirect emissions over time recognizes activities that in aggregate change global emissions, any such concerns over accuracy should not inhibit companies from reporting their indirect emissions. In cases where accuracy is more important, it may be appropriate to undertake a more detailed assessment of the actual reduction using project quantification methodology.

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Appendix 4: Voluntary Carbon Standard (http://www.v-c-s.org/) The Voluntary Carbon Standard is the first International Voluntary Carbon Standard. It has been developed by The Climate Group, the International Emissions Trading Association (IETA) and the World Council for Sustainable Development. It provides the standards and framework for independent validation and verification of GHG emission reductions and removals based on ISO 14064-2 2006 and ISO 14064-3 2006. It covers all those activities related to the generation of GHG emission reductions and removals. It aims to standardize and provide transparency and credibility to the Voluntary Carbon market by establishing a rigorous, global standard. The VCS will include Agriculture, Forestry and Other Land Uses (AFOLU) in the list of eligible project activities. Specifically, Agricultural Land Management is included (ALM). Three broad categories of activities are included:

a. Improved cropland management b. Improved grassland management c. Cropland and grassland –use conversion.

Other areas may be included in the future. Improved cropland management practices include, but are not restricted to:

• No till, no bare fallows, use of cover crop, conversion from annual to perennial crops and creation of buffers – for example wind or water buffers.

• More targeted use of N fertilisers, and use of other fertilisers with

lower Nitrous Oxide emissions.

• Improved grassland management practices include, but are not restricted to:

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• Increasing forage productivity, deep rooted grazing plants, reducing overgrazing, reducing burning, and reducing methane by keeping grasslands in a healthy state.

• Cropland to grassland conversion can increase soil C by increasing

below ground C inputs and elimination of soil disturbance. The above also forms the basis of Carbon Farming under the proposed Carbon Farmers of Australia Trading scheme, so the Standards can develop in tandem.

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Appendix 5: Scientific method and alternative agriculture Extracts from “The Science of Organics: Peeling the Onion to Reach Core Truths” Dr. Charles Benbroo, Chief Scientist of The Organic Center http://www.organic-center.org/res.lead.benbrook.html One of the foundations of science is being able to replicate a finding in another place and at another time. In fact, whenever scientists publish a novel finding that's never appeared before, that data and any conclusions based upon it, are typically not accepted until it is replicated somewhere else by another team of scientists… In studies on the impacts of organic farming systems, especially field-based studies, precise replication is difficult, and indeed often impossible, since the conditions of each study are so heavily influenced by soil conditions, weather, levels of pest pressure, and how routine farming practices were carried out. One way for scientists to get around many common, uncontrollable sources of variability is by carrying out comparative studies over multiple years, in many places, on fields that are side-by-side. When the same sorts of impacts are observed year after year in such studies, greater confidence is placed on quantitative findings… In looking at the science that has been done comparing organic and conventional food and farming, we often see that scientists have designed studies to address the same question, but with subtle and sometimes important differences. For example, some studies analyze organic fields that have just recently been converted to organic management, whereas others focus on fields that have been under organic management for over 10 years. The former field might actually still have more in common with a conventionally managed field that a long-term organic field… In other cases, scientists have compared organic fields to conventional fields in which a number of core organic practices have already been adopted, such as use of compost, mating disruption for insect pest management, and use of cover crops to suppress weeds and build soil fertility. Scientists also tend to come up with different ways to measure food quality and as a result, the data collected in one study might not be directly comparable to the results obtained in other research...

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Much of the past research comparing "organic" and conventional systems has been flawed. One of the reasons that many studies done by academic scientists have failed to find consistent differences between conventional and organic food is because the scientists have based their field research on university experiment stations that have been farmed conventionally for twenty, thirty, or a hundred years. They attempt to convert some acreage to organic production, but typically do it quickly, accepting certain "compromises." They are simply not able to grow crops as skillfully as an experienced organic farmer. They don't have the time to build up their personal farming skills to match those of good organic farmers. They lack the time to work with a piece of land for five, ten, or twenty years in building up its fertility and capturing all of the biological benefits that are associated with organic farming. The deepest and most significant benefits of organic farming almost certainly arise from complex system interactions that are extremely difficult to isolate and control in replicated field studies. They also are hard to study through reductionist research strategies (i.e., carrying out research on one isolated component of a complex organic system). This does not mean that the benefits do not exist; it just means that two of the core strategies of western science - replication and reduction of complex systems to their component parts - are relatively inefficient in peeling away the layers of this onion.

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Appendix 6: Guiding Policy-Makers’ Decisions The objections and issues raised with the Enquiry during the preliminary meetings reveal a pattern of perception management identified in the Yes Prime Minister series as a technique to ‘guide’ the outcome of deliberations. The Carbon Coalition submits that the Enquiry should be wary of being “Sir Humphreyed”: "Ministers will generally accept proposals which contain the words simple, quick, popular and cheap. �� "Ministers will generally throw out proposals which contain the words complicated, lengthy, expensive and controversial. “Above all, if you wish to describe a proposal in a way that guarantees that a Minister will reject it, describe it as courageous."

Key Words For Detecting “Decision Guidance” On Climate Change & Agriculture

“…a number of potential practical difficulties to the inclusion of agriculture..” “…difficult to guarantee given the complexity…” “…diverse range of locations, climates…” “…processes that are inherently variable…” “…difficulties associated with monitoring…” “…may add complexity to the design…” “…difficult to apply traditional regulatory measures…” “…involve initial investment while the benefits may be realised over a longer period of time…” “…existing practical limitations…” “…limited and/or administratively burdensome…”

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“…the costs of accurately monitoring and verifying emissions at entity level is likely to be high relative to the level of emissions…” “…may lead to errors in emissions calculations if the relationship … is uncertain …” “… the high level of variation that can occur…” “…research has suggested that models… complex, technically demanding, time consuming…” “…do not produce results accurate enough…” “…require an initial upfront investment…”

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Appendix 7: About the Carbon Coalition The advocacy group seeking the right of primary producers to:

• trade the credits they can earn by ‘growing’ carbon in their soils • offset their emissions from livestock and fertiliser usage that

remain after best practice has been achieved, and to be • fully engaged and not marginalised in the issue of climate change

and adjustment to new conditions. 550 members across Australia, including farmers, scientists, extension officers, industry association executives, consultants, etc. Founded February 2006. Organised “Building Bridges” Meetings Between Carbon Farmers and Soil Scientists: Dubbo, March 2007, and Orange, June 2007. Organised the world’s first Carbon Farming Expo & Conference, 16th-17th November 2007 at Mudgee NSW, with 400 delegates from every State and NZ. Organising Inaugural World Congress of Soil Carbon Science & Practice, to be held in Columbus, Ohio, October 2008 Information about soil carbon and the Carbon Coalition can be found at the following sites: www.carboncoalition.com.au http://carboncoalitionoz.blogspot.com www.carbonfarming.net.au Convenors: Michael Kiely Louisa Kiely “Uamby” Via Goolma NSW 2862 (02) 6374 0329 Louisa@carboncoalition.com.au