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Aug 8, 2011

‘Direct action’ in more trouble as ‘soil magic’ blowouts loom

The cost of "soil magic" under the Coalition's "direct action" climate change plan may have been challenged by Greg Hunt himself.

Bernard Keane — Politics Editor

Bernard Keane

Politics Editor

The Coalition’s “direct action” climate change policy is in further disarray after shadow minister Greg Hunt was reported as admitting that a Coalition government would not be able to purchase biosequestered carbon as cheaply as anticipated in the policy’s costings.

The policy aims to meet a 5% emissions reduction target by 2020 by spending an average of $1.2 billion per annum in an “Emissions Reduction Fund” that will purchase 140 million tonnes of abatement per annum through to 2020. The policy and its costings rely on purchasing 60% of that abatement via “soil carbon”, which is not recognised in international carbon abatement agreements, for a price of $8-$10 a tonne.

On July 22, Hunt visited the western Victorian town of Woorndoo to discuss soil carbon and the Coalition’s policy, and his visit was positively covered by the Terang Express in its July 28 edition. During the visit, local journalist Tristan Price asked Hunt about the price of purchased carbon abatement under the policy. Hunt is reported as saying “I won’t predict what the market will deliver. The market could do 1-2 million tonnes for under $10 a tonne.”

Mr Hunt’s office has since told Crikey he did not make the remarks and he would be asking for a retraction. “We are even more certain that the target can be achieved at a lower cost and in higher volume,” a spokeswoman told Crikey. However, Crikey understands that Price and his editor are standing by the report as accurate.

If correct, Hunt’s statement is profoundly damaging because “soil magic” is by far the cheapest abatement in the “Emissions Reduction Fund” costings. If it can only provide abatement for $8-$10 a tonne for 1-2 million tonnes of abatement, rather than the 85 million tonnes planned to be purchased by the Coalition, then the costings will dramatically blow out. Hunt’s costings already appear to have blown out once, after he stated in May that the average price of abatement purchased under his policy would be $15 a tonne, rather than about $11 a tonne in the Coalition’s original costings document.

But the costing of the policy, which has not been backed by any economists, agricultural scientists or climate scientists, has been one of its many weak points from the outset: Crikey reported in February last year that one of Australia’s leading soil carbon experts, Professor Alex McBratney, of Sydney University, believed biosequestration abatement would be more likely to cost $20-$40 a tonne. Professor McBratney confirmed his view to the Terang Express two weeks ago, suggesting soil carbon would be likely to cost about $30 a tonne, more than three times the budgeted cost. Earlier this year, Malcolm Turnbull noted that the policy would “become a very expensive charge on the budget in the years ahead”.

Worse for Hunt, he was embarrassed by comments by Woorndoo farmer Mark Veale, whom Hunt met accompanied by popular first-term local MP Dan Tehan. Veale is a strong advocate for soil carbon and has already undertaken extensive work on carbon sequestration on his own property. However, he told the Terang Express that while he is willing to undertake soil carbon initiatives voluntarily, the Coalition’s plan “won’t be a big enough carrot” and “at the moment there’s not enough incentive”.

Hunt’s office this morning told Crikey “we stand by the estimates provided in our original policy. We strongly support the right of everyone to have an opinion.”

Hunt has had a bad year with numbers: he stumbled badly on Lateline in March when he confused square kilometres with kilometres square, and issued a press release welcoming Nicolas Sarkozy’s plan to drop a carbon tax, when the story was over a year old. Recently, he criticised the government’s carbon pricing package for including international carbon permits that the package in fact ruled out.


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9 thoughts on “‘Direct action’ in more trouble as ‘soil magic’ blowouts loom

  1. Mark Duffett

    …confused square kilometres with kilometres square…?

    Er, how are these different?

  2. John Bennetts

    Hi, Mark.

    One square km is one sq km.

    A 10 km square is 100 sq km.

  3. Jimmy Nightingale

    Bet we won’t be reading about this in the Australian!

  4. Simon Mansfield

    “Soil magic” is of course the same stuff NASA’s James Hansen promotes as the only way other than lots of trees to remove carbon from the atmosphere anytime soon – ie in the next 100 years and not the next 2000 years. But who cares what them climate scientists say. Bernard as usual has the issue all settled.

  5. Gavin Moodie

    Surely no one takes the Coalition’s (environment) policies seriously.

  6. Mark Duffett

    @Simon, James Hansen also says “suggesting that renewables will let us phase rapidly off fossil fuels in the United States, China, India, or the world as a whole is almost the equivalent of believing in the Easter Bunny and Tooth Fairy”, but you won’t see Bernard tackling that issue any time soon, either.

  7. Daniel Bond

    If soil magic abatement is available for less than $10/tonne, then what’s the big deal about a carbon price anyway? Why wouldn’t industry just buy the cheap abatement and avoid paying $23/tonne?

  8. david

    Abbotts lies and stupidity being revealed now even by his own front bench, still the electorate is sucked in.

  9. Simon Mansfield

    @ Mark Duffett

    I almost read that you were saying the opposite. Yes that is quite correct. Hansen goes to town in his latest paper on the myth that renewable are in any position to replace conventional fuel sources in the next few decades.

    I think he’s a little pessimistic on that score and rapid advances in solar will drastically change the energy situation over the next couple of decades. It’s one of the reasons I’m so optimistic about the future and regard the idea that we face crippling energy, food, and water shortages with such distain.

    The tag line for our news service solardaily dot com – is fusion that works. The joke being the sun is a fusion energy source and the photons transfer that energy to Earth – where electrons get all excited and out comes pure electricity with no moving parts – well no mechanical ones at that.

    Substrate technology is moving ahead rapidly and while not quite following Moore’s Law that applies to semiconductors – similar cost down and yield up rates are occurring and which if hold true for the next couple of decades will see Solar PVs ideally positions to challenge almost all other forms of energy production and by the time fusion reactors actually work solar could be a whole lot cheaper by many orders of magnitude.

    The issue of base load 24 hour power remains very important. But even on that score, new battery technology from MIT could see the whole problem of batteries overcome.

    As the former Australian Chief Scientist said – we need a range of energy solutions – and that includes, solar, nuclear, natural gas, oil, coal, wind, biofuel and eventually fusion.

    Just as we need a whole array of solutions to reducing the carbon in the atmosphere over the next 50 years – including – reforestation, soil sequestration, cropping changes, enhanced GMO algae for biofuels and on and on.

    Bernard like so many boxes himself into one position and then spends every opportunity defending that position by cherry picking the science that supports his own prejudices and ignoring what doesn’t fit the narrative.

    We all do it to some degree. But Crikey is either a journal of record that has influence over the national debate or is just a left wing version of the Tele/Hun playing to the peanut gallery.

    While I agree with Bernard that very fast trains are not going to work in Australia without doubling the population – rather than slag and bag the idea – why not focus on the key issue of making trains faster and more reliable within the existing network, and rebuilding consumer confidence in rail. Ad what incentives can be made to move more freight from roads to rail.

    But again we all love the slag and bag match – it’s very Australian and it sells newspapers and generates pageviews. And that’s what counts in modern media. Even among those who supposedly value quality.