An investigation of the viability for an avoided emissions project under a potential Emissions Reduction Fund (ERF) method found significant economies of scale are required to offset current high transaction and audit costs. A potential aggregation of ten farms in the lower Namoi resulted in a negative project return at the baseline Australian Carbon Credit Unit (ACCU) price of $10 over the seven-year project life. However, such a project could become more viable in the future if ERF participation transaction and audit costs are reduced and/or the ACCU price increases to more suitable levels. 

Farmers applying nitrogen fertiliser at optimal crop requirement levels can reduce the carbon footprint of their cotton and achieve economic benefits at a crop enterprise level irrespective of ERF participation. Using a nitrogen budgeting approach, and therefore applying nitrogen fertiliser at optimal levels over a large area through repeated crop cycles, can offer savings when compared to an application above maximum yield requirements. 

Six factsheets outlining the opportunities, benefits and risks for cotton growers interested in participating in the ERF have been published at http://www.cottoninfo.com.au/publications/carbon-cotton-and-emissions-reduction-fund  

Four irrigated cotton gross margin budgets for 2014-15 were published on the NSW Department of Primary Industries (DPI) website at http://www.dpi.nsw.gov.au/content/agriculture/farm-business/budgets/cotton.