What is the Reef Credit Scheme?
The Reef Credit Scheme is an innovative, market-based solution offering a new way to improve the quality of water entering the Great Barrier Reef.
The Reef Credit Scheme was conceived in response to the emerging consensus that a market-mechanism to incentivise water quality improvements across catchments of the Great Barrier Reef was urgently needed.
The Reef Credit Scheme will enable land managers to undertake projects that improve water quality through changes in land management to generate a tradeable unit of pollutant reduction or ‘Reef Credit’. A Reef Credit represents a quantifiable volume of nutrient, pesticide or sediment prevented from entering the Great Barrier Reef catchment.
The relative value of pollutant reduction from nutrient, sediment or pesticide is set using the reef wide pollution reduction targets described in the Reef 2050 Water Quality Improvement Plan (2018). These values will be periodically amended by Eco-Markets Australia, as the Reef Credit Secretariat, to reflect changes to the pollution reduction targets. A Reef Credit can then be sold to those seeking to invest in water quality improvements, such as government, private industry and philanthropists.
Natural resource management organisations, Terrain NRM and NQ Dry Tropics, have teamed up with environmental markets investor, GreenCollar, to develop the Reef Credit Scheme. The Scheme has been developed in collaboration with industry groups, research organisations and regional communities.
With financial support from the Queensland Government, the partnership is focused on setting up a framework to support the Reef Credit Scheme. This framework includes independent governance arrangements that will ensure that the Reef Credit Scheme is founded on delivering the highest standards of environmental and financial integrity. Integrity is further strengthened through a number of safeguards, including the requirement that Reef Credit projects are audited against robust methodologies to verify reductions in sediment, nutrients or pesticides into the Reef.
Benefits of the Reef Credit Scheme
- Clear and robust rules to ensure water quality improvements credited are real, additional and permanent.
- Farmers and land managers earn diversified and regular income over 10- 25 year time frames.
- Research and knowledge linked to on-ground practice through peer reviewed methods designed to suit local conditions.
- Attracts investment from government, corporate and philanthropic sources.
- Investors buy verified water quality outcomes when they are delivered and audited.
- A single administrative platform with independent, transparent and accountable governance oversight to achieve water quality improvement.
- Delivers consistent measurement and monitoring tools to track progress toward water quality targets across the entire Reef.
- Funds Projects designed to suit local conditions, agribusiness requirements and land manager’s plans.
- Complements other key services such as extension, agribusiness, catchment management and other ecosystem services.
In early 2017, work began on designing the Reef Credit Scheme by foundation partners Terrain NRM, NQ Dry Tropics and GreenCollar as part of two reef water quality Major Integrated Projects (MIPs) funded by the Queensland Government. The initial concept and early consultations on mechanisms underlying the Reef Credit Scheme were first held in the in Wet Tropics and later introduced to the Burdekin Dry Tropics.
An initial feasibility study was conducted as part of a consultation phase of the Major Integrated Projects. The study demonstrated the viability of the Reef Credit Scheme.
In mid 2017, the Queensland Government committed support to the development of the Reef Credit Scheme, funding the establishment of a Reef Credit Secretariat for the start-up phase. Work then commenced on establishing the Secretariat and drafting of the Reef Credit Standard, Program Guide and foundation Reef Credit Methodologies. In late 2017, a Reef Credit Interim Steering Committee, comprising the CEOs of Terrain NRM, NQ Dry Tropics and Green Collar, was established to guide the development of the Reef Credit Scheme.
In February 2018 the Reef Credit Interim Steering Committee sought expressions of interest to develop an Options Paper for the Reef Credit Scheme. In particular, the Interim Steering Committee sought advice on how best to design, establish and operate a crediting system aimed at reducing pollutant loads to the Great Barrier Reef.
US based Winrock International was subsequently engaged to develop the Options Paper. Winrock International is a global leader in environmental markets and international development, providing solutions to some of the world’s most complex social, agricultural and environmental challenges.
A final Options Paper was completed in September 2018. This document has provided the basis for development of the Reef Credit Scheme. In mid-2018, the Interim Steering Committee also engaged with a number of operating water quality market programs, participants and founders, and standard development organisations in North America. These, together with discussions with key Australian stakeholders, have further shaped the design of the Reef Credit Scheme.
Throughout 2018 a number of project sites have been identified across the catchments of the Reef to test application of the foundation Reef Credit Methodologies. At these sites, management activities will be undertaken to generate Reef Credits including agricultural and grazing practice change, wetland restoration and gully restoration.
Beta phase review of the Reef Credit Scheme is open for public consultation from 19 July 2021 to 18 August 2021. More details on the review can be found on the Eco-Markets Australia website.