(Image: Zennie/Private Media)

This is part three in a series. For the full series, go here.

When human-induced regeneration (HIR) first became part of the process of producing carbon credits, the Coalition wasn’t in power: it was the Gillard government in 2011 that created the framework for producing carbon credits from revegetation that drew down and stored carbon in trees.

That was via the Carbon Credits (Carbon Farming Initiative) Act 2011, which established the carbon farming initiative (CFI). The act required carbon storage methods to comply with eight integrity standards, including that they be “supported by relevant scientific results published in peer-reviewed literature”, account for “significant cyclical variations that are likely to occur in the amount of carbon sequestered in the relevant carbon pool”, and the calculations about the amount of carbon sequestered should be “conservative”.

Barely 2 million carbon credits were issued before the Abbott government was elected in 2013, and the first HIR project under the CFI wasn’t approved until December of that year. At the time, it seemed that the Clean Energy Regulator was only interested in projects that met the scientific consensus about HIR — that land needed to have been cleared beforehand if a regeneration project was going to genuinely and additionally draw down and store carbon, in contrast to land that hadn’t been cleared but where proponents were simply reducing grazing pressure. There is broad scientific agreement that carbon storage on the latter projects is driven by rainfall and drought, not human decisions.

Indeed, at the time, the CER specifically told project proponents via its website that the HIR methodology “applies to projects where land has been cleared of native vegetation”. A departmental fact sheet on the method said the same thing.

However, in late 2014, then-environment minister Greg Hunt, who had invented the Coalition’s “direct action” policy, secured its passage through Parliament. The policy, now called the emissions reduction fund, had been savagely cut back from $10 billion by Hunt’s harder-headed colleagues, who understood it would deliver little in the way of genuine carbon abatement, but Hunt promised that money from the much smaller ERF would commence flowing in early 2015.

And that’s when there was a massive surge in HIR projects approved by the CER.

But very few of the scores of projects being rapidly approved by the CER were on land that had been cleared. According to the Centre for Environment and Integrity’s carbon integrity explorer, which uses publicly available government datasets to determine the extent of vegetation on carbon estimation areas (CEAs), the average level of clearing on HIR projects registered by the CER in 2015 was less than 8%. Only nine projects registered by the CER in 2015 were on land that had been more than 20% cleared.

Bizarrely, however, the CER claims that each of these projects is on land that has been cleared — presumably a legacy of its original, pre-Coalition intention to approve only projects involving land that had been cleared. 

In the CER’s registry of ERF projects, every HIR-related project is described in the same way:

This project establishes permanent native forests through assisted regeneration from in-situ seed sources (including rootstock and lignotubers) on land that was cleared of vegetation and where regrowth was suppressed for at least 10 years prior to the project having commenced. [Emphasis added.]

But as corruption academic Dr Debra Wilkinson, who runs the Centre for Environment and Integrity, told Crikey, less than 6% of the total area included in all HIR projects has previously been cleared. As a result, most HIR projects simply cannot, according to scientific consensus, produce the level of sequestration that they are being credited for, as they are commencing with often extensive tree cover rather than cleared land. As ANU Law School’s professors Andrew Macintosh and Don Butler argued in a 2022 paper:

The Clean Energy Regulator has allowed proponents of HIR projects to include land areas containing mature woody vegetation at project commencement in their carbon estimation areas … This runs contrary to the requirements of the method and directly conflicts with how the models that are used to estimate sequestration under the method are designed and calibrated. The approach adopted by the Clean Energy Regulator is likely to be resulting in the significant over-crediting of HIR projects. In colloquial terms, proponents are being issued ACCUs for growing trees that were already there when the projects started.

The change of heart by the CER to begin including non-cleared land in HIR projects — in the absence of any change in legislation or regulations — conveniently coincided with Hunt declaring the ERF operational, and opened the way to the generation of tens of millions of carbon credits sourced from HIR projects that the science says simply cannot do what they are claimed to do. But it enabled the Coalition to claim that its flagship climate policy, the ERF, was a success — and to funnel hundreds of millions of taxpayer dollars to rural project proponents and carbon developers.

Ironically, once out of power, Abbott in 2018 attacked international carbon credits as a “rort”. He spoke, for once, from a position of authority — his own government had presided over the start of a truly massive rort involving tens of millions of carbon credits with no integrity.

The only risk to the rort was if the projects could be shown independently to be failing to produce any carbon sequestration. And that was being addressed as well.

Next: satellites, audits and independent verification of sequestration.

Are you astonished by the magnitude of the Coalition’s carbon credit con? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.