Australia Issues First Carbon Credits Under 2021 Soil Carbon Method

Australia’s Clean Energy Regulator has issued Australian carbon credit units (ACCUs) for the first time under the estimation of soil organic carbon sequestration using measurement and models methodology determination 2021 (2021 soil carbon method).

Two Queensland beef properties have been issued a combined 151,312 units worth about A$6m. These soil projects show the potential for Australian landholders to be involved in the ACCU Scheme, improve soil health and diversify their income.

The method has tight controls on how soil carbon increases are estimated. Random soil samples must be collected by an independent person who does not have a financial interest in the project and sent to a laboratory that is both certified by the Australian Soil and Plant Analysis Council and accredited by the National Association of Testing Authorities.

The 2021 soil carbon method allows ACCUs to be issued as a result of implementing new or materially different eligible management activities that lead to a measured increase in soil carbon.

The method imposes a number of discounts to ensure that the amount of credits issued in response to estimated soil carbon increases is conservative. These include:

  • The 20% permanence period discount that applies to projects electing a 25-year permanence period
  • The 5% risk of reversal buffer to protect the ACCU Scheme against residual risks that cannot be managed by the other permanence arrangements
  • The probability of exceedance discount that adjusts estimates of soil carbon change for the possibility that observed changes are the result of sampling variance (statistical noise) rather than management actions
  • 25% temporarily withheld credits for credits claimed after the first subsequent sampling round to ensure increases in soil carbon can be maintained over time.