In a bold move to bolster its sustainability agenda, Qantas has strategically positioned itself alongside industry giants Rio Tinto and BHP as foundational investors in a pioneering nature-based carbon credit fund. This initiative, managed by the newly formed Silva Capital—a collaboration between Roc Partners and C6 Investment Management—seeks to transform Australia’s carbon market by focusing on high-integrity carbon sequestration projects that promise ecological and economic benefits.

The Silva Carbon Origination Fund, with an ambitious target of raising $250 million, is set to redefine carbon credit origination in Australia. This fund, one of the first of its kind in the nation, provides investors with unprecedented access to a scalable supply of high-integrity Australian Carbon Credit Units (ACCUs). These credits will be generated through reforestation initiatives and integrated agricultural practices, representing a significant step forward in Australia’s efforts to meet its carbon reduction commitments under the Paris Agreement.

Strategic Investment from Qantas’ Climate Fund

Qantas has committed $80 million to the fund, a substantial investment made possible through its AUD$400 million Climate Fund, established in 2023. This Climate Fund is integral to Qantas’ broader decarbonization strategy, which includes investments in Sustainable Aviation Fuel (SAF) in partnership with Airbus. By financing projects that align with nature-based solutions, Qantas is not only adhering to regulatory compliance under Australia’s Safeguard Mechanism Policy but also taking proactive steps to ensure a sustainable future for aviation.

Silva Capital Integrated Grazing.

Andrew Parker, Qantas’ Chief Sustainability Officer, emphasized the critical role that high-integrity carbon offsets will play in industries that are challenging to decarbonize, such as aviation. “For hard-to-abate sectors like aviation, high-integrity carbon offsets will be essential in achieving our climate targets. The demand for these offsets is expected to grow, and it’s going to take partnerships across industries to ensure the availability of quality carbon credits,” said Parker. He further noted that this fund would allow Qantas to elevate its carbon market strategy while contributing positively to the overall development of the carbon credit industry.

A Vision for Sustainable Land Management

Silva Capital’s approach to carbon project development is unique. It focuses on acquiring agricultural land in Australia to initiate projects that are not only environmentally sustainable but also economically viable. These projects will prioritize reforestation efforts on previously cleared lands, simultaneously enhancing biodiversity and maintaining the land’s productivity for farming. This dual approach ensures that while carbon is being sequestered, local communities benefit from sustainable agricultural practices.

The fund’s innovative model of combining carbon sequestration with land management offers a blueprint for other nations grappling with the challenges of meeting stringent carbon reduction targets. By investing in such projects, Qantas is helping to scale the market for nature-based carbon credits in Australia, providing a crucial tool in the fight against climate change.

Expanding Qantas’ Sustainability Portfolio

This latest investment is part of a broader series of commitments made by Qantas through its Climate Fund. Notably, the airline recently joined the Sustainable Aviation Fuel Financing Alliance (SAFFA), a global initiative to accelerate the production of biofuels for aviation. In addition, Qantas has made significant investments in a Queensland-based biofuel production facility, a joint venture between Jet Zero Australia and LanzaJet, a leading sustainable aviation fuel technology company.

These initiatives underscore Qantas’ comprehensive approach to sustainability, where a robust carbon offset strategy complements direct investments in decarbonization technologies. The airline’s leadership in these areas is setting new standards for the aviation industry, demonstrating that achieving ambitious climate targets and driving economic and social benefits is possible.

Pioneering a Sustainable Future

As the global demand for high-integrity carbon credits continues to rise, Qantas’ investment in the Silva Carbon Origination Fund marks a significant milestone in its journey toward a sustainable future. The airline is ensuring compliance with international climate agreements and playing a pivotal role in shaping the future of carbon markets in Australia and beyond.

Qantas’ proactive stance, combined with its strategic investments in nature-based solutions, positions the airline as a leader in transitioning to a low-carbon economy. Through initiatives like the Silva Carbon Origination Fund, Qantas is paving the way for a sustainable aviation industry that can thrive in a carbon-constrained world.

Written by: Michelle Warner

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