An environmental market is created when a dollar value can be placed on an ecosystem service that provides benefits for everyone, such as clean air and water, or fertile soil, and there are people to buy and sell these services in the form of environmental Credits.

Environmental Credits are generated by eligible land managers when an approved project produces environmental improvements. 

Learn more here. 

Environmental markets are an extra tool to help solve environmental challenges. They not only provide environmental benefits, but channel environmental investment toward landholders and regional communities.

Environmental markets are being adopted around the world, such as carbon abatement and sequestration, water quality improvement, plastic reduction and biodiversity enhancement.

Some environmental crediting schemes are administered by government bodies, such as Australia’s Clean Energy Regulator and the Australian Carbon Credit Unit (ACCU) Scheme. Others are administered by not-for-profit organisations like Eco-Markets Australia. In Australia, Eco-Markets Australia is the only non-government environmental markets administrator.

Participation in environmental markets may enhance productivity by supporting more efficient and effective land management practices. Participation can also enhance the commercial viability of agricultural businesses by providing an additional revenue stream. However, there may be trade-offs that have to be considered, including opportunity costs.

Landholders may want to consult with an extension officer, agribusiness adviser, or project developer to fully understand the credit generation capacity of their land and the financial viability of a project. As with any business decision, landholders should seek independent legal and financial advice to assist them in making a decision on this.

Participation in any environmental market  administered by Eco-Markets Australia is voluntary.

For example, it is a condition of participation in the Reef Credit Scheme that pollutant reductions claimed are not already required under a regulation. As such, the Scheme credits actions that go beyond regulatory compliance. Voluntary environmental markets create an incentive mechanism and recognise farmers' actions that provide environmental benefits.

Buyers can be anyone wanting to support sustainable change. It might be individuals, philanthropists, corporate entities, or government. 

Sellers are usually land or resource managers who generate environmental credits by undertaking projects on their land that deliver environmental benefits.

An environmental Standard lays out the rules and requirements for developing crediting projects and methodologies, as well as validation, registration, monitoring, verification, crediting and issuance process, and governance arrangements. 

The Standard for the Reef Credit Scheme is available here.

An environmental Methodology is the approved way of undertaking a project that provides verifiable environmental benefits. The Methodologies available under the Reef Credit Scheme are available here.

The Registry is maintained by Eco-Markets Australia and access is restricted to the administrator. Buyers and sellers can open a Registry account to record and track Credit issuances and transactions, however, the sale and purchase of Credits takes place outside the Registry.

A number of safeguards are in place. These include:

• peer-reviewed environmental Standards and Methodologies
• project validation to ensure eligibility requirements are met
• verification of projects by independent, accredited auditors
• using a secure and transparent registry system to record and track Credit transactions

The Reef Credit market is the first environmental market administered by Eco-Markets Australia. In the future, Eco-Markets Australia aims to develop and administer additional environmental markets. A beginner's guide to the Reef Credit Scheme is available here.