The Government’s Section 215 report (December 2022) states that the Government is proposing a relatively low starting price for both methane and nitrous oxide, along with incentive payments and sequestration payments.
Previous Government modelling, released as part of consultation in October 2022, modelled scenarios from a ‘low’ of 8 cents per kg of methane by 2030 to a ‘high’ of 14 cents by 2030.
Those scenarios are significantly lower than the prices originally modelled by the partnership (11 cents in 2025 and 35 cents in 2030). Modelling indicated those higher prices would have had a significant impact on farmer profitability.
However because the Section 215 report did not specify a price, there has been no modelling related to that announcement.
There is more work to be done before the starting price is set and partners are continuing to work with the Government in advance of final policy decisions.
Industry partners submitted on price setting in November 2022. Read the submission here.