International News: Australia Carbon Farming; Japan Feed-In Tariff; German Renewable Energy Railways

08/23/2011
SustainableBusiness.com News

Australia Farmers to Benefit from Carbon Trading

Australia's Parliament is expected to pass the world's first nationwide system for the creation and trade of carbon credits by its farming and forestry industries.

The Carbon Farming Initiative will allow farmers and investors to generate tradeable carbon offsets from agricultural projects.

While farmers and forest managers are not required to reduce emissions or participate in carbon trading, the new system creates strong incentives for them to do so.

Through actions like planting trees, reducing fertilizer use and cutting methane emissions from livestock, they can receive carbon credits to sell into the nation's carbon trading platform, scheduled for a 2014 start date.

Land use in Australia accounts for roughly 23% of the country's greenhouse gas emissions; estimates suggest the trading system could reduce emissions by 460 million tons by 2050. 

Prime Minister Julia Gillard's Labor Party passed the bill in the Senate, with support of the Green party, and the House of Representatives is expected to pass the bill as well. 

Passage is an encouraging sign that Gillard's controversial carbon tax plan may have enough support to pass before the end of the year. 

However conservative opposition has pledged to scrap all carbon trading and tax plans if voted into power in 2013.

Japan Considers Comprehensive Renewable Energy Incentives

Japan's Parliament could pass a comprehensive renewable energy bill this week. 

The country is looking for a way to bring stability to its energy industry following the March tsunami that caused the meltdown of nuclear reactors in Fukushima and a loss of confidence in the nuclear industry. 

Lawmakers are considering a national system for incentivizing solar, wind, biomass and other renewable energy sources with a 20-year feed-in tariff that would require utilities to purchase all renewable energy at predetermined prices. 

The goal is to boost renewable generation by more than 30 gigawatts (GW) over the next decade - the equivalent of 12% of Japan's total generation capacity before the nuclear meltdown.

Japan's three major political parties have expressed support for the legislation, but agreeing to the actual details could significantly weaken the system or derail the effort all together, according to Reuters.

Determining the feed-in tariff rates will be the first major obstacle. Costs will be passed along to consumers on their utility bills, and political instability in Japan could make it difficult to find a consensus on pricing. 

The country's fragmented power grid is also a concern. "The bills are half-baked. The investment plan is there but financing is lacking -- there is no detailed roadmap to finance infrastructure investments needed to make the scheme work, such as setting up proper transmission networks," Hirofumi Kawachi, senior analyst at Mizuho Investors Securities told Reuters.

But if a strong incentive system is put in place, it will be a boon for the solar industry in particular, creating a market that could rival that of Germany, Italy and the US where only a weak market currently exists.

German Rail Sets Course for 100% Renewable Energy

Germany's railway company Deutsche Bahn is boosting its commitment to renewable energy with a goal of being carbon-free by 2050.

The company has been criticized for a lack of renewable energy development in the past, but it appears to be responding to  the swift change in public opinion following the Fukushima nuclear disaster. 

Germany's government shut down eight of its oldest nuclear power plants, made plans to shut down the remaining nine plants by 2022, and renewed incentives for renewable energy development. 

Currently Deutsche Bahn uses 20% renewable energy to power its trains and operations, and has set a goal of increasing to 28% by 2014 and 100% by 2050. 

Railways are one of the largest consumers of electricity, accounting for about 2% of all electricity consumption in Germany.

Deutsche Bahn is a large landholder and already operates two wind farms. The company is likely to expand its investment in wind, place solar systems on top of thousands of train stations, and increase the amount of power it purchases from hydroelectric plants.