AN algae bloom in a dam at Nannup Truffle Farm prompted its owner and businessman David Somerville to investigate carbon farming practices in April last year.
The seriousness of the incident and its potential implications for the truffière became clear when high phosphate levels were determined to be the cause of the algae bloom, as the dam water used to irrigate the farm would be toxic to the truffles, killing their spores.
Mr Somerville sought advice from the South West Catchment Council and took immediate remediation actions by circulating the dam water, flushing the dam over winter and applying biological cleansers.
"We tried to minimise any use of chemicals on the farm, biological fertilisers and minimum low-grade herbicides as well," Mr Somerville said.
For the medium to long-term, Mr Somerville said he recognised the solution would be to build a buffer zone around the dam and it was while considering that option he became aware of the opportunity for carbon farming, despite having no knowledge of the Clean Energy Regulator, Emissions Reduction Fund and the Australian carbon credit units (ACCUs) at the time.
"I certainly understood the principles of carbon sequestration and the potential implications of some form of emissions tax in the future, but that was about the extent of it," he said.
After being advised by the South West Catchments Council the Federal government had a carbon and biodiversity pilot program that provided grants to successful applicants for their carbon sequestration projects, Mr Somerville underwent the grant application process which he described as "difficult".
Concurrently the State government, through the Department of Primary Industries and Regional Development (DPIRD) had launched its own Carbon Farming and Land Restoration Program (CFLRP) to which Mr Somerville also decided to apply.
Whilst acknowledging he also found DPIRD's grant application process extremely difficult, upon completing the CFLRP application Mr Somerville said he felt he had learnt a huge amount about carbon farming.
After being successful in both of his grant applications, Mr Somerville chose to pursue the State government grant due to it being a larger sum of money as well as the program having a comparatively easier compliance regime to that of the Federal scheme.
"The Federal Parliament and Biodiversity pilot offered a grant for the project of $30,000 which is taxable, while the WA Carbon Land Restoration Program offered financial assistance of $50,000 repayable in ACCUs," Mr Somerville said.
"The State funding could be repayed in ACCUs, so not income to me, and had a much easier compliance regime based predominantly off restoration farming."
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For the project, Nannup Truffle Farm has engaged 10 hectares of the farm for local, native reforestation of 1500 trees and shrubs, to provide a buffer for the dam as well as utilise land not suitable to grow oak trees for truffles.
The preparation process for the site is being undertaken, with planting due to take place in April next year and the total cost of the project about $100,000.
"Based upon my costings of $100,000, the Carbon Farming and Land Restoration Program has offered funding assistance of $50,000, so that's a substantial portion... and that can be repayed by 1470 ACCUs in 2028 and 2033," Mr Somerville said.
"That's obviously really important for me in that if the price is above $34 per tonne, then it is in my best interest to keep the ACCUs, sell them or bank them, but if it's below, then I'll say to the State use your 1470 ACCUs.
"Full count assessment determined that we will produce 517 tonnes of carbon per hectare, so an extraordinarily high level.
"Given the discounts for a 25-year permanence as opposed to the 100-year permanence, the net production is 3839 ACCUs... so the net after repaying the State is 2379 ACCUs."
With the project also set to receive a full tax deduction, Mr Somerville said his net outflow for the carbon farming project would be about $25,000.
Clearly an attractive economic proposition, Mr Somerville said the non-economic benefits going forward were of even greater importance to him personally, including the possible impact the project would have on the adjacent soils on the farm.
"The protection of the existing agriculture of the truffière is of primary importance and the water health is going to facilitate that," he said.
"Biodiversity, conservation and climate change are significant issues for me and aesthetics - I want to be able to sit in retirement on my verandah with a rocking chair watching over my truffles and my carbon credits."
Nannup Truffle Farm is the fourth largest truffière in Australia.
