Turn the raw legal text into a practical explanation grounded in Carbon Credits (Carbon Farming Initiative—Plantation Forestry) Methodology Determination 2022.
The following constitutes the continuing plantation project activity for this determination:
(a) conducting one of the following activities:
(i) planting, seeding or coppicing to establish the land as an ongoing plantation forest after the eligibility date for the land; or
(ii) managing an existing plantation forest until harvest and planting, seeding or coppicing to establish that land as an ongoing plantation forest; and
(i) no rotation is longer than 60 years duration; and
2 Eligible land for continuing plantation project activity
(1) Subject to subclause 2, for this determination, land in the project area is eligible land for the continuing plantation project activity if, on the eligibility date:
(a) it satisfies a plantation forest requirement in clause 3; and
(c) it satisfies the native forest requirement in clause 5; and
(d) no part of the land is further than 50km from the nearest national plantation inventory region.
(2) Land in the project area is not eligible land for the continuing plantation project activity if:
(a) the crediting period for the project began before 31 January 2022; and
(b) the eligibility date for the land is on or after 31 January 2022.
(1) The first plantation forest requirement is that:
(a) there is plantation forest on the land; and
(b) within 2 years, it will be older than the relevant default clearfell age.
(2) The second plantation forest requirement is that:
(a) there was plantation forest on the land within the previous 7 years that was harvested before 26 October 2021; or
(b) there was plantation forest on the land within the previous 7 years that:
(i) was harvested after 26 October 2021; and
(ii) at the time of harvest was older than the relevant default clearfell age for that species and region less 2 years.
(3) For this clause, the relevant default clearfell age is:
(a) if the relevant species is listed for the region in whichever of Part 1 or Part 2 of Schedule 6 is appropriate in relation to the rotation under the current management regime—the clearfell age listed; and
(b) otherwise—the clearfell age listed for that species and region in Part 3 of Schedule 6.
(4) For this clause, if the table in Part 3 of Schedule 6 lists both a “default clearfell age – short rotation” and “default clearfell age-long rotation” for a species, the applicable default clearfell age is:
(a) if the rotation under the current management regime for the species is a short rotation within the meaning of clause 1 of Schedule 2—the “default clearfell age – short rotation” listed for that species; and
(b) if the rotation under the current management regime for the species is a long rogation within the meaning of clause 1 of Schedule 2—the “default clearfell age – long rotation” for that species.
4 Non-continuation requirement
(1) The first non-continuation requirement, which may apply if:
(a) the land satisfies the first plantation forest requirement; and
is that if the land were not part of the project, it would be converted to a viable non-forested land use within 24 months.
(2) The second non-continuation requirement, which may apply if:
(a) the land satisfies the second plantation forest requirement; and
is that if the land were not part of the project, forest would not be re-established on the land.
(3) The third non-continuation requirement, which may apply if:
(a) the land satisfies the first or second plantation forest requirement; and
(b) there has been a change in the ownership of the land in the previous 12 months;
is that the new owner made the change with the intention of changing the land use of the project relative to the previous owners or tenants.
(4) For this clause:
(a) a reference to a change in ownership includes a change in tenancy where the new lessee has a lease whose duration is no less than the project’s permanence period; and
(b) a reference to the new owner includes a reference to the new lessee in the case covered by paragraph (a).
The native forest requirement is that the land:
(a) has not, within the previous seven years, been cleared of native forest; and
(b) native forest would not need to be cleared for a project to be conducted.
(1) For paragraph 10(3)(c) of this determination, if the first, second or third non-continuation requirement is relied on, the evidence to be provided must include:
(a) a declaration by the chief executive officer or chief financial officer (however described) of the project proponent that the land satisfies the relevant requirement; and
(b) if the first or second non-continuation requirement is relied on, a statement detailing how the requirement is satisfied, including an explanation of:
(i) why the land will be converted to a viable non-forest land use within 24 months or forest would not be re-established on the land, as applicable; and
(ii) the land use that would apply to the land if it were not part of the project; and
(iii) how financial and other broader strategic considerations have influenced subparagraphs (i) and (ii); and
(iv) why the plantation would not have been converted to a plantation with a long rotation within the meaning of clause 1 of Schedule 2, even if revenue from Australian carbon credit units from undertaking a conversion project is taken into account; and
(c) if the third non-continuation requirement is relied on, a statement detailing how the requirement is satisfied, including an explanation of:
(i) how the new tenant or owner intends to change the land use relative to what it would have been under the previous owner or tenant; and
(ii) how financial and other broader strategic considerations have influenced subparagraph (i).
(2) The statement and declaration must be informed by a financial assessment prepared or reviewed by a qualified independent person within 12 months of the relevant application, which is also attached to the statement, that:
(a) demonstrates that in the absence of the scheme, the plantation forest is likely to convert to a feasible non-forest land use that is financially attractive relative to continuing the plantation; and
(b) demonstrates that with projected revenue from Australian carbon credit units and harvesting, the proponent expects to receive enough revenue to continue the continuing plantation project activity for the entirety of the permanence period; and
(c) is informed by a discounted cash flow analysis of continuing the plantation that extends for at least 25 years; and
(d) if the first or second non-continuation requirement is relied on—is informed by a land valuation made by a qualified independent valuer within 12 months of the relevant application, which is also attached to the statement; and
(e) if the third non-continuation requirement is relied on—is informed by the sale price or cost of the lease, which is also attached to the statement.
(3) For subclause (2), a person is a qualified independent person if they:
(a) hold qualifications, determined by the Regulator to be necessary to hold, to prepare or review a financial assessment for subclause (2); and
Note: A person does not have a financial interest in the project merely because they are being paid to prepare or review the financial assessment.
(4) For paragraph (2)(d), a person is a qualified independent valuer if they:
(a) hold qualifications, determined by the Regulator to be necessary to hold, to prepare land valuations for paragraph (2)(d); and
Note: A person does not have a financial interest in the project merely because they are being paid to prepare a land valuation.
7 Additional requirements for defining continuing CEAs
(1) A continuing plantation CEA must be defined for the offsets report relating to the first reporting period after the eligibility date.
(2) Subclause (1) does not apply in relation to a CEA created by re-stratification of an existing CEA.