- ORIGIN Energy has signed a deal that could create Australia’s largest project to lock up atmospheric carbon using trees.
The deal, potentially worth $169 million over 15 years, would utilise millions of trees over a huge area in Western Australia’s wheat-belt.
Utilising so-called bio-sequestration – storing carbon in plants and the soil to reduce the amount in the air – the plan would generate carbon credits Origin could use to offset any obligations under the federal government’s proposed carbon pollution reduction scheme (CPRS).
With CPRS legislation yet to pass parliament, the move is an indication Origin is readying for new laws that will put a price on carbon emissions.
Under the deal with WA-based Carbon Conscious Ltd, Mallee eucalypt seedlings would be planted across cleared lands otherwise unsuited to agriculture.
Origin, a large energy retailer, will pay an initial $26 million to Carbon Conscious, to establish the plantings until 2011 and organise licence and management fees.
Origin would also have the option of buying up to another $143 million worth of plantings under the deal.
“If these options are fully exercised by Origin, the deal would represent what the parties believe will be the largest carbon forest sink development program in Australia to date,” Origin said in a statement.
Carbon Conscious does not buy potential farmland in the wheat belt, but instead purchases carbon rights of properties, and looks for areas suited to the project on the land to plant the trees.
Not buying the land means the company reduces their costs, and avoids having to get subdivision permits through local councils.
Under the federal government’s proposed reduction scheme companies can claim credits for trees planted so long as the plantings will be left for at least 100 years, and are grown in areas cleared of native forest prior to 1989.
Full article, heraldsun.com.au
