AUSTRALIAN farmers are crunching the numbers on the potential costs of an emissions trading scheme (ETS) on their businesses, and the results are frightening.
Using a calculator based on the accounting rules used by the Department of Climate Change, farmers are learning what their emissions liability could be – and the tens of thousands of dollars it’s going to cost them each year if agriculture is included in a scheme in 2015.
It is also becoming clear farming practices considered sustainable and good for the environment actually count for nothing based on current rules, with some management practices not being recognised under the calculator; notably no-till farming.
There are already fears for the future of the northern pastoral industry with big penalties apparent for farmers who breed cattle or trade them after 12 months of age.
In many respects the preliminary findings vindicate what the government has been saying about agriculture – the sector is complex, more research is needed, and international accounting rules need to be changed to ensure the natural lifecycle and positive attributes of agriculture are better recognised.
But farmers and the Opposition are using these results to argue the Government’s estimates for the cost of its Carbon Pollution Reduction Scheme (CPRS) are well short of what is actually going to happen, and farming emissions should be excluded from the scheme because they are too difficult to account fairly.
The FarmGAS calculator, developed by the Australian Farm Institute (AFI), is a hypothetical modelling tool that allows farmers to work out their farm’s financial and greenhouse gas implications.
Farmers can also test hypothetical changes to their farming practices, such as reducing fertiliser use or turning cattle off sooner.
The calculator includes individual modules for all the major livestock and cropping enterprises, and any combination of these.
The National Farmers' Federation, Cattle Council and AFI are separately compiling case studies using the calculator across various commodity sectors, climatic zones and enterprise mixes to better understand how the proposed CPRS impacts on farmers.
AFI’s Sally Davison says the calculator is helping farmers understand how much their farms emit under current rules, and enabled them to play with scenarios to see what practices would or would not affect their farm’s emission profile.
“If anything, it highlights the amount of research needed to be done if agriculture is to be included in a scheme, and how complex the sector is,” she said.
Hamish Munro did the modelling on his family’s 4100 hectare mixed farming operation at Cumnock in the NSW Central West and was staggered by the results.
He calculated he could cop a $75,000 annual bill under the proposed CPRS if agriculture was fully covered in 2015 with no emissions intensive trade exposed (EITE) assistance.
With that assistance, his liabilities come back to $10,405.83 (with free permits) in 2015, but increasing each year after that as free permits reduce and the price of carbon increases.
Sheep were his big surprise, responsible for the most emissions and the biggest costs.
He considered himself a fairly sustainable farmer, having adopted minimum and zero-till practices, rotational grazing, rumen bloat capsules, tree planting and more.
But he now feels penalised for many of these under the ETS rules.
He said the biggest flaw in the Kyoto protocol, which Australia was now bound by, was its inability to distinguish natural and man-made emissions.
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