Carbon maintenance obligations

About carbon maintenance obligations

Carbon maintenance obligations are a compliance measure under the BidCarbon (Carbon Farming) Specifications. They apply exclusively to sequestration projects.

Carbon stored by a sequestration project may be lost due to natural disturbance or deliberate conduct. In such cases, a project proponent will be required to relinquish a certain number of BidCarbon removal units (BRUs). Failure to relinquish BRUs may result in a carbon maintenance obligation being declared on the project area.

A carbon maintenance obligation helps protect remaining carbon stores and prevents further losses of sequestered carbon. It does not prevent the use of the land for productive purposes, provided that carbon stores are maintained.

Process for making a carbon maintenance obligation declaration

A carbon maintenance obligation is a compliance measure that can only be used in specific circumstances. It is the only option when the required permanence obligations have not been met.

A carbon maintenance obligation is usually not required if:

● projects are managed according to the relevant sequestration method

● or if BRUs have already been relinquished for lost carbon stores.

Before we can issue a carbon maintenance obligation declaration, we must:

● have issued you a relinquishment notice to return BRUs that you have not complied with or are unlikely to comply with.

● be satisfied your project will have to relinquish BRUs and the relinquishment requirement won't be met.

We will provide a copy of the carbon maintenance declaration to:

● the project proponent

● each eligible interest holder

A carbon maintenance obligation declaration requires that a person：

refrain from conducting any activity that would reduce, or is likely to reduce, carbon stores on the land below the benchmark sequestration level, unless it is a permitted carbon activity. This obligation applies to any person, even if they were not involved in the project.

Additionally, an owner or occupier of the land must ensure that the carbon stores on the land are not less than the benchmark sequestration level. This obligation applies even if they were not the owner or occupier when the project was first registered.

Benchmark sequestration

The benchmark sequestration level is the minimum level of carbon sequestration required to fulfill a carbon maintenance obligation.

Do not engage in any activity that could lower the benchmark sequestration level. If the amount of carbon stored falls below the benchmark level, take all necessary measures to restore it to the benchmark level.

To determine the benchmark sequestration level, we may review:

● the original information provided by the project proponent

● conduct desktop assessments

● use compliance monitoring tools

● apply relevant formulas, and 

● access the land to conduct validating ground activities.

The method of calculating the level depends on the reason for the relinquishment. 

For instance, if the relinquishment is due to project revocation, the level could be based on the project offset reports and supporting documentation.

If the relinquishment is due to carbon stock loss, the level should account for the reversal.

Permitted activities

Permitted activities are outlined in the carbon maintenance obligation declaration. These activities are allowed as long as they do not result in carbon stocks falling below the benchmark sequestration level.

Permitted activities include using areas for productive purposes, such as grazing, as well as activities by native title holders exercising their native title rights, provided they were determined after the project became unconditionally declared.

The carbon maintenance obligation declaration will specify the allowed activities and the manner, time, place, persons, or time period during which the activity may be carried out. It is important to note that allowed activities do not override existing regulations around land use.

Understanding Carbon Maintenance Obligations

In the event that a proposed activity may have an impact on the carbon stores of an area that is subject to a carbon maintenance obligation, it is possible to submit an application to request a variation or revocation of the declaration.

You can apply to:

● remove a particular part of the land from the declaration

● add or change permitted activities

● revoke the declaration.

In order to recognize the impact on carbon stores while allowing other commercial activities to continue, it is important to provide flexibility in managing carbon maintenance obligations. This approach helps to ensure that BRUs represent genuine and additional abatement.

How to request a variation

If you wish to exclude a specific area from a carbon maintenance obligation declaration, you may submit a written request providing the necessary details of the land to be removed. 

We will inform you of the number of BRUs that must be voluntarily cancelled for the variation to take effect. This number is typically a percentage of the BRUs issued for the project, based on the size of the land being removed relative to the carbon estimation area(s) in the project.

Example:

● The carbon maintenance obligation applies to the entire project area.

● It is worth noting that the land being removed constitutes 30% of the project's total estimated carbon areas.

● It is recommended that the number of BRUs to be voluntarily cancelled does not exceed 30% of the total BRUs issued for the project.

It is recommended that you arrange to voluntarily cancel the required number of BRUs. It is not necessary for the BRUs to come from the project.

Once we have confirmed that the BRUs have been cancelled for the variation, the relevant areas will be removed from the declaration.

We will make every effort to ensure that variations are processed within 30 days of the BRUs being cancelled.

Consider variation or revocation the declaration of a carbon maintenance obligation

The carbon maintenance obligation declaration may be revoked under certain conditions, including the relinquishment of all BRUs issued for the project and the land subject to the carbon maintenance obligation not being part of any sequestration project.

It is important to note that the person applying for revocation of the carbon maintenance obligation declaration or relinquishing the associated BRUs does not necessarily need to be the original project proponent.

Removing a carbon maintenance obligation