CO2 Group calls 'Timberrr!' on Direct Action

23 January 2014

By Tristan Edis in Climate Spectator

Yesterday we reported that the long-time chief executive of the CO2 Group, Andrew Grant, would be departing the company. CO2 Group is one of a very small number of Australian listed companies that are focused on the opportunities flowing from the need to reduce carbon emissions.

Importantly, CO2 Group are probably one of the best positioned companies (in addition to landfill and coal mine methane power producers) to benefit from government’s Direct Action Emission Reduction Fund.

Yet the departure of its chief executive seems to signal a vote of no confidence in the ERF by the board of CO2 Group.

The company in announcing the departure of its chief stated:

"Recent changes in government policy, the proposed abolition of the current carbon pricing regime and continuing uncertainty in the carbon market generally has led the Company to reduce the scale of its carbon operations and pursue new growth areas, such as expanding its environmental services and trading businesses and its developing aquaculture business."

The Coalition has been keen to push the idea with the general public that planting trees would be a major feature of how the Direct Action scheme would make “practical” changes to reduce Australia’s emissions. And if anyone was going to make a fist out of supplying serious quantities of abatement from tree plantings under Direct Action, the odds would be on CO2 Group via its subsidiary CO2 Australia.

CO2 Group was the first company to create carbon credits through creation of new forests under the Carbon Farming Initiative (established under the prior government to encourage abatement in the land sector) and is the largest producer of CFI carbon credits through this form of abatement. Environment Minister Greg Hunt has said on several occasions that the government’s Carbon Farming Initiative will represent the cornerstone mechanism for assessing the eligibility and certifying the carbon credits for abatement projects under his ERF.

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