We congratulate the NSW Government for establishing the Great Koala National Park, which will protect a nationally significant koala population.

We also acknowledge the government’s moratorium on logging in ~175 000 hectares of state forest that will be added to the network of national parks in NSW. This area contains high-quality koala habitat, old-growth forest critical for many threatened and endangered species, and provides vital connection between forest habitats in the region.

However, as they say: “Every silver lining has its cloud”. In this case, the government has stated that establishment the Great Koala National Park is conditional. Documents relating to the decision specify: “The final creation of the park is dependent on the successful registration of a carbon project under the Improved Native Forest Management Method, which is currently moving through the Federal Government assessment processes.” This caveat raises several concerns.

A central issue is that there is no guarantee the proposed Improved Native Forest Management Method will be approved, or approved in its current form. The INFM Method is being assessed by the Emissions Reduction Assurance Committee, which advises the federal environment minister on whether the method meets legislated Offsets Integrity Standards. If it fails to meet these standards, it may need to be refined and resubmitted.

If the INFM Method is approved, it will be added to the Federal Register of Legislation. At that point, the project proponents can use it to register projects and generate Australian Carbon Credit Units (ACCUs). These credits — the currency of Australia’s carbon market — are only awarded when abatement is deemed both real and additional. The additionality test requires that “carbon abatement that is unlikely to occur in the ordinary course of events”.

This brings us to a key question: Given that the Great Koala National Park has long been a stated policy commitment of the NSW Government, would registering it under the INFM Method truly deliver additional abatement and therefore qualify for ACCUs? While the government is on the record as being committed to establishing a Great Koala National Park, they have recently announced that this will be created by adding to existing reserves 176,000 hectares of state forests to existing reserves — forming a protected area network of more than 475,000 hectares stretching from Kempsey to Grafton and inland to Ebor. It is this 176,000 hectares that is conditional on INFM approval. We assume that this conditional inclusion of the 176,000 hectares of state forest is what the government is relying upon to meet the additionality criterion,

A second issue is that the INFM Method proposes two kinds of options for offset projects in public native forests: (1) stopping timber harvesting (i.e., logging) in public native forest or (2) reducing timber harvesting in those forests logging, by deferring the timing of timber harvesting, thereby extending the length of harvest rotations and reducing the volume of wood extracted from the project area over a given period. For the areas of state forest absorbed into the Great Koala National Park, option one would generate genuine mitigation benefits by avoiding logging emissions. Option two, however, could be applied elsewhere in NSW, and potentially in Queensland and Tasmania. This would allow governments to continue native forest logging while receiving carbon credits for “reduced” or deferred logging harvesting.

The problem is clear: option two would enable state government forestry agencies to receive carbon funds while continuing to emit considerable volumes of CO2 from ongoing logging emissions. For example, logging in Tasmania each year generates carbon emissions equivalent to those from 1.1 million cars. “Deferred logging” is simply delayed pollution – once released, 25-30% of that carbon remains in the atmosphere for thousands of years. The evidence is also clear that other variations on an INFM, that include management practices related to thinning of young trees or salvage logging, should not be included in an INFM method because of the impact they would have on carbon emissions.

From a scientific perspective therefore, the INFM Method should be modified to remove the first option so that the only option for an offsets project is one that stops native forest logging altogether.

The best outcome — for both climate and biodiversity — is to end native forest logging altogether. This conserves forest biodiversity like koalas and countless other species (such as the Endangered Southern Greater Glider), while preventing substantial emissions. It would also reduce fire risk. This is because logged forests are more flammable than intact forests for up to 70 years after harvesting.

Most economists agree that the most cost-effective market mechanism to reduce fossil fuel emissions is through a carbon price, with a cap-and-trade scheme restricted to the industrial sector a close second. However, given the realities of the Australian Government’s safeguard mechanism and ACCU system, an INFM Method could achieve real mitigation benefits. To achieve this, it must only allow offsets based on a complete cessation of native forest logging – and must prevent leakage into other high conservation value forests.

Such an approach is also economically feasible. Australia does not need to keep logging native forests. Plantations now supply about 90% of Australia’s sawn timber. The native forest logging industry in NSW is the “tail wagging the dog”, surviving only through hundreds of millions of dollars in taxpayer subsidies. Carbon schemes should not entrench this failed model. Halting native logging altogether would not only generate real mitigation benefits but also allow scarce taxpayer dollars to be redirected to more productive and less environmentally damaging parts of the state’s economy.

Finally, if ERAC agrees that the NSW Government’s park commitment does not disqualify the project under additionality rules, then approval of an INFM Method — and its application to the Great Koala National Park —could open the door to similar opportunities elsewhere. Specifically, it could support park proposals where boundaries are not yet finalised, and where conditional inclusion of public forests could help secure both biodiversity and climate gains.

The views expressed in this article may or may not reflect those of Pearls and Irritations.