Carbon farming

The first object of the CFI Act 2011 is to avoid and remove greenhouse gases from the atmosphere to help Australia to meet its international emissions reductions obligations. Each Australian Carbon Credit Unit or ACCU is equivalent to one tonne of carbon dioxide (or equivalent) that is avoided or permanently stored.  ACCUs are generated  as a result of activities that would be unlikely to happen without a financial incentive, and are saleable units that can be purchased and ‘retired’ (cancelled) by businesses or entities that are required to or want to offset some or all of their greenhouse gas emissions.

However, while the primary purpose of the CFI Act is to provide a robust framework for reducing and storing greenhouse gas emissions, the third object of the CFI Act is to increase carbon abatement in ways that are consistent with the protection of Australia’s natural environment and that improve resilience to the effects of climate change. 

Regional NRM plans:

• describe the local environmental, economic and social contexts for their region;
• are informed by, and developed in partnership with, local communities;
• identify the natural resource management priorities for the region;
• consider sustainable land uses for different areas;
• plan for the restoration and protection of landscapes, including ensuring that projects are planned to accommodate and reduce the risk of climate related impacts.

Thus, the reference in the CFI Act to regional NRM plans provides a pathway to give effect to the third object of the Act – to increase carbon abatement in ways that can support local ecosystems, both – now, and in the future. 

There may be other benefits, both to carbon project proponents, and regional people and places, from alignment of carbon projects with regional NRM plans. Ensuring consistency with NRM plans might help proponents to avoid place-based unintended adverse outcomes, like planting inappropriate plant species or failing to understand local climatic conditions. Also, the plans might provide information about communities that can support additional economic and social benefits from carbon projects, like inclusion of local contractors, consideration of local First Nations aspirations, or identification of opportunities to aggregate projects in areas that are of high local priority, such as riparian areas that can bolster downstream flood resilience. Alignment with NRM plans can also reduce overall risk to the ACCU scheme, as projects that are well informed by regional NRM data and knowledge and aligned with plans’ objectives are more likely to be supported by local communities.

While the provision for consideration of regional NRM plans in carbon farming projects has been in the CFI Act 2011 from the start, there is little information available across Australia to help us understand how regional NRM plans have been used to inform carbon farming projects. While almost every carbon farming project proponent states that their project is consistent with the regional NRM plan, and the Carbon Industry voluntary Code of Conduct says that proponents should keep a record of how they have determined their projects to be consistent, there aren’t any formal processes in place to verify these claims. From our conversations with carbon farming project proponents, we understand that some do have processes in place to consider regional NRM plans and determine if their projects are, or could be made, consistent.

Individual regional NRM organisations also consider carbon farming in different ways within their regional NRM plans and supporting tools and documentation. Some regional NRM organisations have designed tools specifically to communicate what is required of carbon projects to ensure consistency with their plans; some include guiding principles for project proponents; while other NRM plans are silent on how carbon project farming projects fit into regional land uses. The spectrum of responses of regional NRM organisations to carbon farming within their planning documents reflects both available ACCU methods (whether there are few or many applicable methods); viability of ACCU projects, given other constraints, such as higher value land uses; whether carbon farming projects interact with their other planning obligations, such as consideration of catchment water use;  and the capacity of individual organisations to engage with new market opportunities where no funding is available to support the work. 

In addition, there are some inconsistencies with how the legislation and rules have been presented and interpreted in documentation and registers relating to how this section of the CFI Act is enacted. We will continue to work through any consistency issues with CER and others to provide clarity to all stakeholders.

NRM Regions Australia has been working with members and others over a number of years to increase both the visibility, and impact of the requirement for carbon project proponents to consider and use regional NRM plans. After engaging with the Climate Change Authority (CCA) over an extended period, in 2023 the CCA recommended that the Australian Government:

“In consultation with stakeholders, amend the CFI Act to expand the role of regional Natural Resource Management (NRM) plans and organisations in informing the planning and establishment of ACCU projects, and resource NRM organisations accordingly.”

In 2024 the Australian Government provided in-principle support for this recommendation, and committed to further exploring the role of NRM organisations in the ACCU Scheme through the Stage 3 ACCU Review reforms, as well as considering any overlap or interaction with the needs of the Nature Repair Market.

Since then, NRM Regions Australia has continued to engage with DCCEEW, the Clean Energy Regulator, the Carbon Market Institute (CMI), our regional NRM members, and others to better understand how various parties engage with the requirement of the Act and how we can raise awareness of both the obligations for carbon project proponents under the Act, and the benefits of ensuring carbon projects are consistent with NRM plans.  

To do this we:

• Ran a CER supported, multi-sector stakeholder workshop on what it means to be consistent with regional NRM plans in Cairns in September 2025;
• Are engaging with CER to support development of additional materials to be added to their website in early 2026 to explain what it means to be consistent with a regional NRM plan, including some regional NRM case studies;
• Are working with CMI and the carbon farming industry to determine what ‘best practice’ for consistency with regional NRM plans might look like;
• Have formed an NRM sector working group to consider how regional NRM organisations and plans might best communicate relevant information to the carbon farming industry and others on what it means to be consistent with the place-based plans;
• Will continue to work with all stakeholders to implement the provisions of the CFI Act for consideration of regional NRM plans, as was intended. 

For more information on how you can be part of this conversation, please contact Rachel Clarke, Carbon Lead and Knowledge Broker NRM Regions Australia [email protected].

The links to all regional NRM plans by organisation are available via our website. Go to the ‘Regions page’ and use the clickable map or navigate by jurisdiction to the region you are seeking and follow the link to their regional NRM plan.