Carbon + Biodiversity Pilot

Applications for the Carbon + Biodiversity Pilot open 12 April and close 11:59pm (AEST) 11 June 2021.

To apply you must read the pilot documentation available here and at Grantconnect.

Applications can be submitted through agsteward.com.au

About the program

The Carbon + Biodiversity Pilot is trialling arrangements to reward farmers for improving on-farm biodiversity together with carbon projects under the Emissions Reduction Fund (ERF). 

The Carbon + Biodiversity Pilot is part of the wider $34 million commitment of the Australian Government to biodiversity stewardship on farms. The 2021–22 Budget delivers $32.1 million over four years in additional funding. The Carbon + Biodiversity Pilot is being developed with the Australian National University (ANU).

Applications open 12 April 2021 and close 11:59pm (AEST) 11 June 2021.

Under the pilot, farmers who plant native trees – in line with a biodiversity protocol developed by the ANU – will receive payments for biodiversity outcomes. These payments will be in addition to earnings a landholder might receive for their carbon abatement.

Eligible activities will build on ERF carbon projects.

Examples could include:

  • Planting, managing and looking after vegetation
  • Regenerating gullies, waterways and degraded hillsides

These plantings can also benefit farmers by providing shelter for livestock, improving soil moisture and reducing erosion. 

Enquiries about the program can be directed to agstewardship@awe.gov.au. You can also call us on 1800 329 055.

If you want to be notified of future developments, let us know via email to agstewardship@awe.gov.au.

Eligible regions

The Carbon + Biodiversity Pilot will be run in six Natural Resource Management regions. Eligible regions are:

  • Burnett-Mary in QLD
  • Central West in NSW
  • North Central in Vic
  • NRM North in Tasmania
  • Eyre Peninsula in SA
  • South West in WA

The Carbon + Biodiversity Pilot has 5 core elements:

  1. Plantings established under the Carbon + Biodiversity Pilot must be protected and maintained for a minimum of 25 years in accordance with ERF requirements. Participants will be required to undertake new ERF environmental plantings projects involving reforestation through either planting or direct seeding of native tree and shrub species. Participants will also need to ensure they satisfy relevant ERF participant obligations, including in relation to measurement, reporting and auditing.
  2. Projects participating in the Carbon + Biodiversity Pilot will also need to comply with the Carbon + Biodiversity planting protocol and reporting requirements. The planting protocol sets out rules about the location, dimensions, configuration and composition of plantings to ensure projects generate biodiversity benefits.
  3. Projects contracted under the Carbon + Biodiversity Pilot will receive biodiversity payments over the course of the project. Payments will be contingent on the satisfaction of relevant Carbon + Biodiversity Pilot requirements, including the planting protocol.
  4. Projects that meet ERF requirements, as determined by the Clean Energy Regulator, will be able to receive Australian carbon credit units (ACCU) for the carbon sequestered in the planting project. Participants can sell, keep or cancel any ACCUs they receive for the projects.
  5. Plantings established under the Carbon + Biodiversity Pilot will need to be protected and maintained for at least 25 years. Once registered under the ERF, the projects will be subject to the ERF permanence requirements.

How to apply

Before applying, you must read and understand the pilot document and the relevant planting protocols and price guide for your region. These documents can be found below and on the GrantConnect website. Any alterations to these documents will be published on GrantConnect and by registering on this website, you will be automatically notified on any changes. GrantConnect is the authoritative source for grants information.

To apply

  1. Read pilot documentation, and the planting protocol and price guide for your eligible NRM region.
  2. Plan your project and consider how it fits into your existing agricultural business, seeking expert advice (e.g. agronomists, financial advisers, service providers and others) were needed.
  3. Complete your application and submit through the web portal accessed at agsteward.com.au.

Pilot documentation and factsheets

Download

​Document Pages File size
​Agriculture Biodiversity Stewardship Carbon + Biodiversity Pilot PDF  39 859 KB
Agriculture Biodiversity Stewardship Carbon + Biodiversity Pilot DOCX 39 1.0 MB
​Agriculture Biodiversity Stewardship - Carbon + Biodiversity Pilot (factsheet) PDF  2 667 KB
Agriculture Biodiversity Stewardship - Carbon + Biodiversity Pilot (factsheet) DOCX  2 991 KB
Emissions Reduction Fund Application Process (factsheet) PDF 5 288 KB
Emissions Reduction Fund Application Process (factsheet) DOCX 5 82 KB
Emissions Reduction Fund Eligibility Requirements (factsheet) PDF 4 241 KB
Emissions Reduction Fund Eligibility Requirements (factsheet) DOCX 4 36 KB
Carbon + Biodiversity Application Video Guide MP4    
Agriculture Biodiversity Stewardship - Application Portal Guide PDF 15 1.1 MB
Agriculture Biodiversity Stewardship - Application Portal Guide DOCX 15 13.5 MB

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Planting Protocols and Price Guides for eligible NRM regions

Burnett-Mary in QLD

​Document Pages File size
Price Guide - Burnett-Mary NRM region PDF  10 1.6 MB
Price Guide - Burnett-Mary NRM region DOCX 10 859 KB
Planting Protocol- Burnett-Mary NRM region PDF 26 655 KB
Planting Protocol- Burnett-Mary NRM region DOCX 26 1.6 MB

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Central West in NSW

​Document Pages File size
Price Guide - Central West in NSW PDF  10 1.6 MB
Price Guide - Central West in NSW DOCX 10 859 KB
Planting Protocol - Central West in NSW PDF 28 1.2 MB
Planting Protocol - Central West in NSW DOCX 28 2.2 MB

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North Central in VIC

​Document Pages File size
Price Guide - North Central Victoria PDF  10 1.6 MB
Price Guide - North Central Victoria DOCX 10 860 KB
Planting Protocol - North Central Victoria PDF 25 648 KB
Planting Protocol - North Central Victoria DOCX 25 1.3 MB

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NRM Northern Tasmania

​Document Pages File size
Price Guide - NRM Northern Tasmania PDF  10 1.6 MB
Price Guide - NRM Northern Tasmania DOCX 10 860 KB
Planting Protocol - NRM Northern Tasmania PDF 26 730 KB
Planting Protocol - NRM Northern Tasmania DOCX 26 1.7 MB

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Eyre Peninsula in SA

​Document Pages File size
Price Guide - Eyre Peninsula in SA PDF  9 1.6 MB
Price Guide - Eyre Peninsula in SA DOCX 9 860 KB
Planting Protocol - Eyre Peninsula in SA PDF 26 1.1 MB
Planting Protocol - Eyre Peninsula in SA DOCX 26 4.6 MB

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South West in WA

​Document Pages File size
Price Guide - South West in WA PDF  10 1.6 MB
Price Guide - South West in WA DOCX 10 859 KB
Planting Protocol - South West in WA PDF 24 905 KB
Planting Protocol - South West in WA DOCX 24 4.3 MB

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Questions and Answers

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Where do I find information about the Pilot?

A: Please visit our webpage for information on the pilot including factsheets, hypothetical scenarios and program documentation. Look for the Carbon + Biodiversity tab on the left side of the web page.

Am I eligible to apply for the Carbon + Biodiversity Pilot?

A: To be eligible, you must satisfy these requirements:

  1. Your property must be in one of the eligible pilot regions (see below)
  2. Your property must be predominantly used for agricultural purposes.
  3. You must be willing and able to undertake a new Emissions Reduction Fund (ERF) environmental plantings project.
  4. You must be an individual or body corporate who owns the land on which the project will be undertaken, in the sense of holding the freehold title.
  5. You must meet the participant obligations under the ERF as outlined on the Clean Energy Regulator’s website.
  6. You must not have begun the project.
  7. You must provide a commitment to act with the utmost good faith in your engagements with the program.

Please visit our website and program documentation for further information about who is eligible and how to apply.

Where is the pilot being run?

A: The pilot is being run in 6 Natural Resource Management regions:

  • Burnett-Mary in QLD 
  • Central West in NSW 
  • North Central in VIC 
  • NRM North in Tasmania 
  • Eyre Peninsula in SA 
  • South West in WA 

Why is my region not eligible to participate in the Carbon + Biodiversity Pilot?

A: The six Natural Resource Management (NRM) regions were chosen to test the pilot across a range of farming systems, vegetation types and jurisdictions to generate the necessary data to effectively trial the pilot’s policy objectives. Other NRM regions may be included in the future but have not been determined at this point in time.

How long will applications be open for?

A:  Applications will be open until midnight 11 June 2021.

What information do I need for my application?

A:  As part of the application process, you will be asked to provide project details such as the address of the property, plot where the plantings will be established, and cost estimates for the project (fencing, supply of trees and other associated costs). Applications can be lodged through the Agriculture Stewardship portal

How do I apply to the Carbon + Biodiversity Pilot?

A: Once open, applications will be lodged through the Agriculture Stewardship portal

Do I have to participate in the Emissions Reduction Fund to be eligible for the Carbon + Biodiversity Pilot?

A: An eligibility requirement for participating Carbon + Biodiversity Pilot is to register your project as a new Emissions Reduction Fund (ERF) environmental plantings project, involving reforestation through either planting or direct seeding of native tree and shrub species. The project must satisfy the eligible offset project registration requirements under the ERF and must not already be registered. You will be able to do this after (and if) we make you a price offer.

I need help understanding the requirements under the Emissions Reduction Fund. Where do I go for help?

You can find two factsheets about the Emissions Reduction Fund (ERF) on the Carbon + Biodiversity website.

The Clean Energy Regulator also has resources available online to help applicants understand the
requirements under the ERF:

If you would like to speak to a professional about the ERF, you can find relevant organisations near your region by using the Carbon Market Institute’s Australian Carbon Market Directory.

What is the difference between this program and the Smart Farms program?

A: The Smart farms program (2017-18 to 2022-23) is a separate Australian Government initiative that is complementary to the aims of the Agriculture Stewardship Package. Part of the second phase of the National Landcare Program, the program supports the development and uptake of best practice, tools and technologies for:

  • Farmers and land managers
  • Fishers
  • Foresters
  • Regional communities

Who can help me if I am having trouble with the application process?

A: You can call 1800 329 055 or email agstewardship@awe.gov.au for queries about the application process. You can also call your local Natural Resource Management organisation for more details:

What are the size requirements for my project under the Carbon + Biodiversity Pilot?

A: Eligible Carbon + Biodiversity Pilot Projects must have an aggregate planting area of between 5 and 200 hectares.

What advice do I need before applying?

A: We strongly recommend that applicants seek independent professional advice about participation in this pilot, potentially including financial, legal, agronomy and carbon project specialists. You should decide what advice to seek as appropriate for your circumstances.

What happens to carbon credits I earn?

Any Australian Carbon Credit Units (ACCUs) you earn under the scheme are administered by the Clean Energy Regulator (CER) under the Emissions Reduction Fund. ACCUs can be sold at auctions administered by the CER or through private markets and are in addition to the biodiversity payment. More information about this process can be found on the Clean Energy Regulator website.

How are payments calculated?

The pilot will trial a dual-track approach to determining the biodiversity payments made to successful applicants. Under the dual-track approach, the biodiversity payments offered to applicants will be determined using one of two processes.

  • Option A: Applicants can submit cost estimates for their project and, if they are successful in the selection process, they will receive a biodiversity payment offer that considers their estimated costings.
  • Option B: Applicants can submit their own bid price for the biodiversity payment they are willing to accept, along with their project costs. If they are successful in the selection process, they will receive a biodiversity payment offer based on either the bid price or the estimated costs of the project.

For applicants who choose Option A, the price offer will be calculated using a financial model that accounts for the likely revenues from the sale of carbon credits and the project costs (for example establishment costs, recurrent management costs, and reporting and auditing costs).  Option B is similar to Option A, but it gives applicants the opportunity to put in a lower bid price to increase their chances of receiving an offer. This is because it is a competitive process and we are seeking to maximise the biodiversity we gain for our payments.

What are the key dates and timeframes?

Activity Timeframe
Release of program documentation for potential applicants to consider 5 March 2021
Planting protocols and pricing guide published online April 2021
Applications open April 2021
Applications close 11 June 2021
Assessment of applications and make biodiversity payment offers to applicants 14 June – 14 July 2021
Applicant consideration of offer and contract is signed by both parties Mid-July – mid-August 2021
Within 4 weeks from date of offer
ERF project registration and exercise option to initiate project Mid-July – mid-December 2021
Within 4 months of contract being signed
Undertake plantings Mid-October 2021 – mid-September 2022
Within 9 months of ERF project registration
End date of activity or agreement Accepted offers: 25 years after the date on which the project is registered under the ERF
Relinquished offers: 6 months after the date of execution of the agreement

* Dates ranges are indicative and are reflective of earliest and latest possible dates. Timeframes will vary between participants.

Can you provide a case study of a Carbon + Biodiversity Pilot project?

How can carbon service providers participate in the Carbon + Biodiversity Pilot?

1. Can carbon service providers apply to participate in the Carbon + Biodiversity Pilot?

  1. No, Section 4.1(4) of the Carbon + Biodiversity Pilot guidelines states that applicants ‘must be an individual or body corporate who owns the land on which the project will be undertaken, in the sense of holding the freehold title.’

2. Can carbon service providers assist farmers in applying for the Carbon + Biodiversity Pilot?

  1. Yes, carbon service providers can provide a range of services to assist farmers in applying for the Carbon + Biodiversity Pilot. However all applications must be made in the farmer’s name to satisfy the eligibility criterion at Section 4.1(4).
  2. Carbon service providers could provide services to assist farmers, including but not limited to:
    1. Application assistance for Carbon + Biodiversity Pilot
    2. Application assistance for Emissions Reduction Fund (ERF) component of Carbon + Biodiversity Pilot

3. Can carbon service providers bundle multiple Carbon + Biodiversity Pilot applications and register them as a combined Carbon + Biodiversity Pilot project?

  1. No. Applicants to the Carbon + Biodiversity Pilot must own the land on which projects are undertaken and be willing to undertake an ERF environmental plantings project in their own name (see sections 4.1(3) and (4) of the Carbon + Biodiversity Pilot guidelines).  
  2. No, Section 4.1(4) of theCarbon + Biodiversity Pilot guidelines states that applicants ‘must be an individual or body corporate who owns the land on which the project will be undertaken, in the sense of holding the freehold title.’

What are the options for small projects to participate in carbon markets?

Following the Report of the expert panel examining additional sources of low cost abatement (the King Review), the Clean Energy Regulator (CER) is considering a fixed price purchasing desk to acquire Australian Carbon Credit Units (ACCUs) from small projects and intends to consult on a proposed approach later in the year.

Once an Emissions Reduction Fund (ERF) project is registered, participation in an auction to obtain a contract to sell ACCUs to the CER is not a requirement and ACCUs can be sold privately to other parties. It is not necessarily the case that a landholder as the project proponent would require an Australian Financial Services License (AFSL) to sell ACCUs generated by their project to parties other than the CER.

Australian Securities and Investment Commission’s Regulatory Guide 236 states that you are generally likely to require an AFSL if you are providing a financial service, and you are providing a financial service if you deal in a financial product (such as ACCUs).

RG 236.33 (page 14): “However, if a person is simply dealing on their own behalf (e.g. acquiring the legal and economic interests in a financial product for themselves), this is not an activity that requires an AFS licence, unless the dealing consists of issuing a financial product.”

Participants should seek their own advice with regard to their own circumstances.

Some other information that may be useful:

How much money can I receive if I am successful under the Carbon + Biodiversity Pilot?

The biodiversity payments offered to successful applicants will be determined using one of two processes.

Option A. Successful applicants that do not submit a bid price.

Successful applicants that do not submit a bid price will receive a biodiversity payment offer based on the estimated cost of the project. The biodiversity payment offer will be calculated using a financial model that seeks to provide efficient projects with an appropriate rate of return on the capital invested. The model accounts for:

  • the carbon revenues projects could receive from the sale of carbon credits;
  • the cost of establishing and maintaining the plantings; and
  • the cost of reporting and auditing associated with the project.

Having regard to this information, the model calculates the biodiversity payment offer necessary to achieve a reasonable rate of return.

The carbon revenues projects could receive will be estimated by multiplying an estimate of the Australian Carbon Credit Units (ACCUs) projects are likely to receive by a projected future ACCU price. The ACCUs are estimated using the planting areas mapped by the applicant. Average climate conditions are assumed for these purposes. A standardised conservative ACCU price path will be used to estimate ACCU revenues.  

The cost of establishing and maintaining the plantings will be estimated using the information submitted by the applicant and/or undisclosed cap prices. Our cap prices will be used where an estimate submitted by an applicant for a cost component exceeds the relevant cap price.

Reporting and auditing costs will be estimated using standardised costings.

Option B. Applicants that submit their own bid price.

Applicants that submit their own bid price will receive a biodiversity payment offer based on either their bid price or the estimated costs of the project (whichever is lower).

What return could I make if I undertake a Carbon + Biodiversity Pilot project?

The returns from Carbon + Biodiversity Pilot projects will vary depending on a number of factors, including:

  • whether the biodiversity payment offer is based on the estimated cost of the project or a bid price;
  • the participant’s ability to control the costs of the project;
  • rainfall, which influences the number of Australian Carbon Credit Units (ACCUs) the proponent is eligible to receive; and
  • the price the proponent is able to receive for their ACCUs.

Also note that, because of the rate at which plantings grow and sequester carbon, it may take a number of years for projects to recover establishment and other costs and start to return a profit.

For example, in Case Study 1 – involving a 40 ha project near Grenfell in Central West NSW with a 25-year permanence period under the ERF – the establishment costs are estimated at $140,000, while the present value of the revenue from the carbon credits (ACCUs) is likely to be around $80,000 and the project will receive $100,000 in biodiversity payments over its first 3 years. Based on relatively conservative estimates of likely future ACCU prices, and after considering recurrent management, reporting and auditing costs, the project could return a profit of $5-$45 per ha per year (in real dollar terms). If ACCU prices are higher, all else being equal, the returns will be higher. Notably, these estimates assume average rainfall throughout the 25-year crediting period. Variations in the rainfall received over the crediting period could lead to higher or lower returns.  

In Case Study 2 – involving a 15 ha project near Campbell Town in Tasmania with a 100-year permanence period under the ERF – the establishment costs are estimated at $63,000, while the present value of the revenue from the ACCUs is likely to be around $51,000 and the project will receive $52,500 in biodiversity payments over its first 3 years. Using relatively conservative future ACCU prices and assuming average climate conditions, the project could return a profit of $30-100 per ha per year (in real dollar terms), after accounting for management, reporting and auditing costs. Again, if ACCU prices are higher, all else being equal, the returns will be higher, and the returns could be affected by variations in rainfall. The higher returns from this case study relative to the Grenfell case study reflect the fact it receives more ACCUs because the project has a 100-year permanence period and is, therefore, its ACCU entitlement not subject to the 20% permanence period discount as a 25 year project would be.

How did you choose the pilot regions?

The six Natural Resource Management (NRM) regions were chosen to test the pilot across a range of farming systems, vegetation types and jurisdictions to generate the necessary data to effectively trial the pilot’s policy objectives. Selection criteria identified the best regions to test the applications of the biodiversity measurement protocols that are being applied under the pilot. The choice of regions provides broad geographical spread and will facilitate the testing of the biodiversity measurement protocols in a range of different agricultural environments.

The proposed regions and selection criteria were identified in consultation with the Australian National University, the Agriculture Stewardship Advisory Group (established to provide stakeholder input to the development, implementation and review of components of the Agriculture Stewardship Package) and departmental experts.

How do you choose successful applicants?

Applications will be subject to an initial screening to determine whether the project and applicant meet the eligibility requirements. Applications that are eligible will be assessed and ranked in accordance with the process detailed in section 8,1, page 23-24 of the pilot documentation.

To assess the applications, the Minister for Agriculture will establish an assessment panel, chaired by a senior officer of the department. The panel will include 2 departmental employees, and 2 specialist advisors from the Australian National University. All members of the assessment panel will be expected to perform their duties in accordance with the Commonwealth Grants Rules and Guidelines (CGRG) 2017 (section 2.9). An independent probity advisor will support the selection advisory panel, and other experts may be invited by the chair in a non-voting capacity. The selection advisory panel will recommend which projects should be successful to the decision maker.

Does the pilot accommodate group/ jointly managed projects?

We welcome jointly managed or group projects. All landowners will need to complete their own application. The Carbon + Biodiversity Pilot’s eligibility criteria, on page 14 of the pilot documentation, apply to both the applicant and to the proposed project. Applicants need to carefully read the eligibility criteria as they apply to all members of the project. Coordination between projects will need to be driven and managed by landowners amongst themselves. Each application will be assessed on its own merits.

What happens if my Carbon + Biodiversity plantings are delayed or impacted by events beyond my control?

Once you exercise the option to participate in the Carbon + Biodiversity Pilot you will be legally required to undertake the plantings within 9 months of registering the Emissions Reduction Fund (ERF) project.  You should take reasonable steps to minimise delay to planting the vegetation, and will be required to notify the Department of Agriculture, Water and the Environment of any delay.  The department has the discretion to grant an extension if the project is delayed for reasons beyond the control of the participant, such as drought or other factors.

In the longer term, if the environmental plantings are impacted due to a natural event (e.g. drought) the landholder would need to replant or repay an amount proportional to the loss. The specific details for this will be dealt with through your Carbon + Biodiversity contract. Section 10.1 of the Carbon + Biodiversity Pilot documentation outlines requirements for successful grant applicants.  

Participants will also need to meet any requirements of the ERF. Information on making changes to your ERF project can be found at Making changes to your project (cleanenergyregulator.gov.au).

Under the ERF, if a fire or other disturbance occurs in the project area during the permanence period, causing a decline in the amount of carbon stock, regrowth must be managed to allow the carbon stock to return to previously reported values. Alternatively, Australia Carbon Credit Units equivalent to the loss of carbon caused by the disturbance must be relinquished.

What is the closing time for C+B applications on 11 June 2021?

Applications received by 11.59 pm (AEST) on 11 June 2021 will be considered. We cannot guarantee that applications received after 11.59 pm (AEST) will be considered. 

Where can I review the template funding contract?

Preparation of this document has been delayed, and will not be published prior to 11 June 2021. 

Successful applicants will nevertheless have two opportunities to consider the terms of contract, and (if they choose) seek expert advice on it:

  1. when the government makes a price offer with the accompanying contract (before signing), and
  2. during the up to six month period between after signing the contract and before choosing to proceed (by exercising the ‘option’ in the contract).
Last reviewed: 9 June 2021
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