Viticulture– Carbon introduction

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Presenter/s names hereThis is an Agrifood Skills Australia Ltd project developed in partnership with Energetics Pty Ltd and funded by the Australian Government under the Clean Energy and Other Skills Package

• Climate change • Resource depletion

– Energy– Water– Materials

• Increased emissions, contamination & waste

• Reduced air quality • Loss of biodiversity

2

What is the problem?

How is economic activity affected by climate change?

Agriculture, tourism and insurance•Directly affected - more droughts, floods and bush fires.

Carbon taxes, energy tariffs and emissions trading.•To address climate change, emissions must be reduced

Impact upon other sectors•Energy sector costs flow through to energy intensive sectors – mining, manufacturing

Other indirect impacts include •Reduced demand for products

•Disruption to business activities

•Potential litigation•Brand and reputation risk

Longer term global impacts potentially:•Large scale refugee movement

•Political instability •Social unrest.

Risks specific to Australia

Access to Water • Australia is the driest

continent on earth • Many industry sectors

are dependent on access to water for operation.

Market related risks• Climate change risks in

other countries may differ remarkably – regulations, consumer behaviour

Energy pricing• Low energy costs, greenhouse

intensive coal sources• Costs to increase – oil prices,

carbon, lack of investment, drought conditions

Regulatory uncertainty• Carbon Price and Emissions

Trading.• Uncertainty - difficulty in long-

term infrastructure/ asset planning.

Things to consider when managing carbon – organisational boundariesDecisions must be made as to how emissions will be aggregated. Three approaches include:•Equity share•Financial control•Operational control

Operational control is default boundary!

What is operational control? Defined in Australian law as the right to introduce or implement operating, health and safety or environmental policies

Things to consider when managing carbon – operational boundaries

Scope 3 “Emissions from services You use and products You

produce”

Nat Gas

PetrolProcess emissions

LPG

Scope 2 “Fuel burnt for You”

Scope 1“Fuel You Burn”

Electricity

The business case for carbon management – carbon neutrality

.

Vineyards producing ‘carbon neutral’ wine.

Vineyards producing ‘carbon neutral’ wine.

• Case Study: Temple Brewer - Carbon Neutral

“From 2011 onwards all wines produced by Temple Bruer are and always will be carbon neutral. Temple Bruer has achieved carbon neutrality through measuring its carbon footprint through a cradle to gate lifecycle analysis, working tirelessly to reduce our footprint through all means possible and finally purchasing environmental and socially sustainable carbon credits to offset the remainder.. We hope to achieve this through increasing our generation of renewable electricity through a combination of solar with future plans to invest in a pyrolysis plant, Continuing to search for further savings and participating in the Federal Governments carbon farming initiative and further reducing our footprint in any way possible.”

The business case for carbon management – carbon labeling

uk carbon trust

.

Aldi – first company in Australia to introduce

Carbon Reduction Labels.

Suppliers now required to• report GHG emissions

• commit to GHG reductions

Aldi – first company in Australia to introduce

Carbon Reduction Labels.

Suppliers now required to• report GHG emissions

• commit to GHG reductions

Woolworths and the Australian Food and Grocery Council conducting study on benefits of carbon

labeling

Woolworths and the Australian Food and Grocery Council conducting study on benefits of carbon

labeling

The business case for carbon management – carbon trading

• Japan – currently designing ETS that is likely to be implemented in 2011

• NZ – ETS started 1 July 2010• China - likely to have an ETS• EU – existing ETS may legislate a 30% reduction target• UK Coalition - setting a floor price for carbon• US – multiple regional ETS’

From 1 July 2012 – Australia has a price on carbon set at $23 per tonne of CO2-e – following a number of other

countries

NB: Emissions trading works: EU verified emissions showed a decrease of 11% in 2009

The business case for carbon management – carbon price

Q: Who pays the Carbon price?Q: Who pays the Carbon price?

Some pay directly eg. Large users of coal such as coal fired power stations

Some pay directly eg. Large users of coal such as coal fired power stations

Some pay indirectly eg. Consumers of electricity / smaller users of fuelsThink petrol excise – you pay, but payment collected upstream

Some pay indirectly eg. Consumers of electricity / smaller users of fuelsThink petrol excise – you pay, but payment collected upstream

The business case for carbon management – what level of price?

What might a carbon price be?

Interim tax$23

Introduced 1 July 2012

Permit price5% reduction

target for 2020= $25 in 2013

Transition to trading scheme

(variable price)= $20 - $35 in

2015

Regulationeg. ban on all

coal - fired generators

(incl. boilers)

NB: Very costly for someNB: Very costly for some

Costs spread across the economy

The business case for carbon management

Experience shows that sustainability makes good business sense

• Embedding sustainability within an organisation’s broader business strategies frequently results in organisational and technical innovations that generate both top- and bottom-line returns.

• Reducing inputs to a business, due to a carbon-constrained economy, reduces costs.

• Reducing inputs requires new or improved products or even new business lines.