The confusing world of carbon offsetting

First the good news. After a functioning carbon price was killed off in 2014, and after then being allowed to pollute at will, big industry is again going to be made to account for the carbon it puts into the atmosphere.

The Albanese government has tightened the “safeguard mechanism” of its predecessor’s Emissions Reduction Fund, so that heavy industry is on board to help push emissions down to the government’s twin objectives of 43 per cent below 2005 levels within seven years and net-zero emissions by 2050.

The changes, announced last week by climate change minister Chris Bowen, apply to the 215 biggest emitters currently responsible for 28 per cent of Australia’s total. Manufacturers, smelters, coal and gas plants and airlines will have to cut the intensity of their emissions below a prescribed ceiling, to be lowered each year by 4.9 per cent. 

The not-so-good news arises out of the net in net-zero, distinguishing the zero in emissions targets from real, absolute zero. Emitters who fail to meet annual reduction targets will be able to make up the shortfall by buying carbon credits, currently expressed as Australian Carbon Credit Units (ACCUs), each unit corresponding to a tonne of emissions.

When this happens, things get complicated. Lowering emissions of carbon dioxide from burning fossil fuel or methane from mining, agriculture and landfill has an immediate physical impact that everyone can get their heads around. The impact of offsetting, which rewards land managers for preventing carbon loss by changing practices, or capturing and holding carbon in trees or the ground, is less precise and much harder to measure. 

Which is where former chief scientist Ian Chubb comes into the picture. Chubb was selected by the Albanese government to head a review of carbon offset schemes, and last week released the panel’s findings. The minister likes what he sees, and has accepted Chubb’s recommendations in full.

Chubb said last week he wanted to avoid repeating past experience where “we’ve sacrificed good because it wasn’t perfect”. The existing scheme, he said, was a “human-designed process… a bit frayed at the edges” but basically sound. His review foreshadowed replacing controversial credits for avoided land-clearing and human-induced reforestation with a new system allowing more people to participate. 

Andrew Macintosh is an ANU law professor who resigned in 2020 after five years in charge of the Emissions Reduction Assurance Committee. Last March he alleged that Australian offsetting had become a rort. He said that credits for forest regeneration, avoided deforestation and landfill methane, representing about three-quarters of the multi-billion dollar scheme, were “little more than a wealth transfer, welfare payments for the undeserving”.

Last week he and forest ecologist Don Butler wrote in The Conversation that Chubb’s proposed changes to the scheme’s governance, while a good step, would not stop operators from maximising profit at the expense of integrity. 

Pointing to support for their position from CSIRO, the Australian Academy of Science and the Wentworth Group of Concerned Scientists, they warned that allowing polluters to use “low-integrity” credits to meet emission reduction obligations would put the government’s whole climate policy in jeopardy. They said they were “bewildered” by Chubb’s conclusions.

They shouldn’t have been. As a former scientist with administrative experience, Chubb is alert to politicians’ need for wriggle room and to how Macintosh’s claims might damage public support for offsetting if they were to remain unchallenged. He’s no doubt right that our “frayed” offsetting scheme is as sound as anyone’s.

The fact is, they’re both right. Measuring offsets, no matter how scrupulously they are set up and operated, will never be more than a loose approximation of the truth. When the raw reality of human carbon emissions comes up against the needs of economic and political survival, we should be in no doubt that the latter will prevail – until it passes breaking point.

Two years ago, three eminent European scientists with over 80 years of climate research between them wrote that the concept of net-zero emissions “has licensed a recklessly cavalier ‘burn now, pay later’ approach which has seen carbon emissions continue to soar … [and] hastened the destruction of the natural world”.

James Dyke and Robert Watson (UK) and Wolfgang Knorr (Germany) said that for all our offsetting tricks, carbon dioxide was accumulating faster than ever. And now, despite a cooling La Niña, last year turns out to be the fifth-warmest in two centuries of instrument records.

Without land sequestration to draw down the carbon already up there, we’re cooked. But we’ll be burnt to a crisp if we don’t break our fossil fuel addiction.

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