‘Sky money’ from carbon cloudland

Fish River became even fishier last week. The Australian government Indigenous Land Corporation (ILC) announced another “first”:  it had found a buyer for the "first indigenous carbon credits" from its Fish River Fire Project.

The “fantastic” outcome (curiously) coincided with a speech by Climate Change Minister Greg Combet to the National Press Club on “Clean Energy Future Plan One Year On: How Carbon Pricing is Working”, where the minister reaffirmed Labor’s commitment to oppose repeal of its anti-carbon [dioxide] scheme if it loses the 2013 election.

Caltex Australia Ltd had bought all its 25,884 FRFP “Kyoto-compliant” Australian Carbon Credit Units (ACCUs) “on the open carbon market” and “through an open expression of interest process”.

ACCU: 1. A unit created (out of thin air) by a diligent employee of the Clean Energy Con Regulator making an electronic entry in an account on the Australian National Registry of Emissions Units. 2. Each ACCU represents one tonne of carbon dioxide equivalent net abatement (through either emissions reductions or carbon sequestration) achieved by activities deemed “eligible” by the government. 3. Legal tender in Warmerland, an island near Balnibarbi, whose inhabitants are possessed by an irrational belief that ACCU issuance will prevent “dangerous” climate change and related phenomena in the distant future – especially if accompanied by silly rituals and mantras claimed by its (well-remunerated) priestly class to be necessary to reduce the island’s “carbon footprint”.

An open market is a regulated one with public-price transparency and mandatory disclosure rules – except in the opaque world of domestic carbon trading. 

According to the ILC, the “final price” was “over $20 a tonne”. However, “the “actual price paid by Caltex Australia” could not be made public as it was “commercial-in-confidence information”.

Why the secrecy? The FRFP CC transaction price is not the only information withheld from public scrutiny behind a firewall of “confidentiality”.

As mentioned in Part I, ILC has not released its FRFP risk assessment, project offsets report (February, 2013) and “unqualified reasonable assurance” audit opinion (March 18, 2013).

According to the ILC’s June 5 media release, Caltex was selected because it has a “demonstrated commitment to advancing indigenous and environmental issues”. It apparently intends to use the FRFP CCs as “part of its first permit surrender requirements under the Carbon Price Mechanism”.

Caltex has yet to make any public statement, at least to my knowledge. However, it could be part of its community and social investment program designed “to make a real difference in the community”.

Perhaps its silence is merely due to the transaction’s small size. Caltex is currently Australia’s fortieth-largest ASX-listed company, with a market value of $6.50 billion and net profit after tax of $146 million for the first three months of calendar 2013. It is the country’s leading transport fuel supplier and retailer, and the only listed integrated oil refining and marketing group.

How did we end up here? To reiterate, the government committed to distributing the (rapidly shrinking) pot of gold at the end of its “carbon [dioxide] price” rainbow in, according to Minister Combet, a “socially fair and responsible way”.

In the process, the carbon con was de-coupled quietly from its original purpose. Three or so years ago – before the public became aware of the rotting core of international climate politics (and science) – the national debate was all about climate change and saving the planet.

Today, however, it has morphed into a series of “creative” cash transfer and payment policies. Ministers – and bureaucrats – now attempt to legitimise them by using the rhetoric of social disadvantage, and promoting their “substantial co-benefits”.

Alarmist climate change mantras have been removed from the propagandist lexicon and replaced by others with a more positive spin, such as: “nine out of ten households will be better off”.

In the case of Fish River, “benefits include employment and training of Indigenous people, facilitation of access to the property by Traditional Owners, protection of important cultural sites, and protection of rare and threatened animal and plant species found on the property.”

No wonder they call it "mani bilong skai" (sky money) in PNG, rather than the acronyms and euphemisms favoured by the Canberra Carbon Cargo Cult Club.

Rangers Desmond Daly, Jeff Long and their colleagues at Fish River certainly deserve a lucky break or three. But surely there is a less labyrinthine – some would say less bizarre – way of directing (in this case) less than a million dollars to their community than by forcing residents to worship at the altar of our latest deity – anthropogenic global warming and “dangerous” climate change?

© Michael Kile — June 2013