Agriculture is a significant source of emissions, accounting for 16.6 per cent of Australia’s national greenhouse gas inventory. 

However, agriculture, forestry and other land use are also essential for removing and storing greenhouse gas emissions and regenerating ecosystems.  

When most people think about decarbonisation, they think about getting to net zero,  meaning emissions are balanced out by removing carbon dioxide from the atmosphere. 

The Climate Change Authority’s recent Sector Pathways Review states that emissions from Australia’s agriculture and land sectors currently come close to balancing each other out. Agriculture was responsible for 85Mt CO₂e in emissions in 2022, with the agriculture and land sector providing an 88 Mt CO₂e sink. 

Even with ambitious emissions reductions from other sectors, Climateworks Centre’s modelling shows that a very large amount of residual emissions will need to be removed from the atmosphere for Australia to align with the Paris Agreement’s 1.5°C temperature goals. The vast majority of which will need to come from the land sector.

Decarbonisation for land and agriculture is complex, especially for industries like livestock grazing, which cover much of Australia’s land. 

These industries need to reduce emissions but setting emissions reduction targets must also consider how land use choices affect the ability to remove carbon and restore biodiversity – highlighting the trade-offs between climate and nature goals, and agricultural production. 

For example, reforestation on agricultural land has the potential to provide both increased carbon sequestration and biodiversity benefits. However, reforestation may require a change in land use and this could impact food production.

However, agreeing on the best use for land is no easy feat. The majority of Australia’s landmass is privately held. 

These lands hold most of the potential to increase sequestration and enhance biodiversity, as this is where most forest and vegetation clearing has historically taken place. 

They also provide the foundation for regional communities and the food, fibre and, increasingly, renewable energy needed to meet growing demand from Australian and export markets. 

A lack of agreement on which sectors are responsible for enabling large-scale carbon removal and who should bear the associated costs complicates the situation. 

Policies related to agriculture, climate mitigation, and biodiversity are often developed in isolation or with differing and sometimes competing objectives. 

Efforts to use land for multiple goals, such as protecting biodiversity, emissions sequestration and agricultural production, have often been piecemeal and lack the coherence and scale needed to drive meaningful change.

An integrated approach to land use

Australia is not alone in struggling to balance multiple interests and objectives associated with land use. New Zealand’s Parliamentary Commissioner of Environment released a report earlier this year, Going with the grain: Changing land uses to fit a changing landscape, which offers some useful recommendations for addressing this challenge. 

It proposes a more integrated approach to land use, which involves considering the environmental impacts of all land uses and changes together rather than addressing them separately. 

This approach promotes diversified land uses that offer environmental benefits and could create multiple income streams for landholders while helping to achieve climate and biodiversity targets. 

The report outlines key factors for success, including determining the appropriate scale for integration (e.g. catchment area), ensuring high-quality information connects land management ambitions with environmental outcomes, engaging communities in decision-making, and securing the financial resources to support these efforts.

An example of an integrated approach: integrating crop production with reforestation efforts for a catchment area.

 A group of landholders might agree to plant native tree buffers along waterways to reduce soil erosion and improve water quality while still maintaining productive farmland. High-quality data on soil health, crop yield impacts, and biodiversity benefits would guide how much land to allocate for tree planting versus crops.

 Farmers would be supported in their decision-making and could receive financial support (eg. through carbon or biodiversity credits or other types of incentives) for implementing these practices, promoting both economic returns and positive environmental outcomes.

To properly reward landholders for taking climate-positive actions that support their livelihoods and the broader public good, a range of policies, beyond those directly related to land use, need to work coherently.

 Policy integration requires aligning targets, actions, and plans across sectors and within financial systems and supply chains, ensuring that the entire system supports and values sustainable land management.

The New Zealand report also highlights the importance of high-quality, spatially granular information that links land use and management practices with measurable environmental outcomes to align policy decisions with sustainability goals. 

For Australia, Climateworks, in conjunction with Deakin University, has developed such a tool. LUTO2 is a world-leading spatial model that maps the best way to use and manage land in Australia to meet climate and biodiversity targets without compromising economic growth and food and water security. 

LUTO2 can help visualise and clarify the complex trade offs and synergies between different strategies and objectives.  

With a data-driven foundation to inform decision-making and consensus-building, and a coherent policy environment that supports land use change as an opportunity for economic resilience and diversification, Australia can turn land use challenges into a catalyst for a greener, more prosperous future.