Farmers will be encouraged to plant extra trees and then sell carbon credits to companies.
Landcare says 10 hectares of trees could yield about $20,000 over 30 years.
Garth Strong, a farmer from the Riverina in New South Wales, says the scheme is a good way of supplementing his income.
"I think it’s something to look at, especially if you’re doing revegetation, making tree lines wide enough to qualify for carbon trading," he said.
"The single lines of trees aren’t much good – they really need fairly substantial plantings – but there’s definitely a win-win situation I think."