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Victoria on the wrong side of the Green Triangle

The Australian Forest Products Association wants the Victorian and Federal Governments to urgently co-operate to deliver new production tree plantings which would provide a boost to local jobs and post COVID-19 economic recovery while reducing emissions. Source: Timberbiz

In July the Federal Government announced that four and half initial Regional Forestry Hubs were declared exempt and able to fully participate in the Carbon Farming Initiative (CFI), allowing new production tree plantings to bid for carbon credits under Emissions Reduction Fund (ERF) auctions.

The initial declared hubs are in SW Western Australia, Northern side of Tasmania, NE New South Wales, South West Slopes of New South Wales and Victoria, and the South Australian side of the Green Triangle.

Inexplicably, the declaration did not extend to the Victorian side of the Green Triangle, meaning south west Victorian farmers and landowners are restricted from registering new production tree planting projects and from bidding in the ERF.

However, a new report from Ernst & Young has highlighted the many environmental and social benefits of new plantations while stating that ‘Plantation forestry participation in the CFI through a Victorian Green Triangle exemption will not cause a rapid expansion of the plantation estate when considering existing investment constraints.’

For example, Ernst & Young reports that the current carbon credit price is between $14 to $16 per tCO2-e, which would increase expected returns by only a modest 1%-2%, especially with the region seeing the highest land values of any national plantation region in 2019.

“This new report shows that the Victorian side of the Green Triangle is missing out,” AFPA CEO Ross Hampton said.

“Renewable forest industries have been part of the region for more than 140 years, occupying less than 6% of the total land area. Access to carbon credits will help reverse a decline in the plantation estate securing local jobs and associated economic activity.

“The report busts the myth that there would be large-scale expansion. It makes no sense for there to be one rule on the South Australian side of the Green Triangle and another on the Victorian side.”