Carbon farming an emerging opportunity for agribusiness, says law firm
Agribusinesses should be considering carbon farming opportunities and low emission technologies with carbon emission regulation likely to be expanded soon, a specialist law firm says.
A stronger focus on achieving net zero carbon emissions by the government and large companies is creating both opportunities and risks for agribusinesses, according to Cooper Grace Ward Lawyers.
In a recent article, CGW Lawyers partner Leanne O’Neill and special counsel Diane Coffin said that under the current regulation, only private sector facilities producing more than 100,000 tonnes of carbon dioxide equivalent emissions per year are subject to an emission cap at a level set by the Clean Energy Regulator.
“However, these thresholds – both in relation to the level of emissions that trigger regulation and the cap itself – are likely to be lowered, with groups such as the Business Council of Australia supporting the move,” said Ms O’Neill.
“With pressure mounting to extend the reach of the legislation in order to achieve ‘net zero’ carbon emissions by 2050, it is only a matter of time before other businesses – including agribusiness – will be required to take further action.”
Even without a net zero mandate, market forces are influencing a shift towards lower carbon emissions for many businesses, the law firm said.
“Companies comprising around half of the collective ASX market value are now committed to achieving net zero and over 400 Australian brands have achieved Climate Active certification under a federal government initiative,” it said.
While the future of emission reduction poses some risk and uncertainty to agribusiness, the law firm said it also represents a substantial opportunity for agribusiness in relation to carbon farming projects.
Most carbon farming projects comprise either vegetation methods or agricultural methods. Vegetation methods include revegetation and afforestation projects that remove carbon dioxide from the air, while agricultural methods involve changing stock management practices to reduce methane and nitrous oxide production, the law firm explained.
Australia’s Long-Term Emissions Reduction Plan also identifies priority technologies for government investment, with the hope of driving down the costs of these technologies so they become industry standard.
“Key technologies identified for the agricultural sector include land-based solutions, (including soil carbon methods) and other emerging technologies, such as livestock feed supplements,” CGW Lawyers said.
Ms O’Neill opined that agribusinesses should be thinking about carbon farming opportunities and ways to transition to low emission technologies.
“Of course, emission reduction initiatives for agribusiness are not without challenges and risks,” she said.
“Given that legal and commercial frameworks for carbon farming and other associated initiatives are in their infancy and relatively untested, it is critical that agribusinesses obtain technical, financial and legal advice.”
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