International carbon credits no longer needed as Australian carbon market explodes: RepuTex

In fiscal year 2020-21, these facilities generated 137 million tonnes of greenhouse gases, or 27% of the country’s overall emissions. Tightening pollution caps from these facilities is a key government initiative to cut Australia’s emissions by 43% below 2005 levels by 2030.

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RepuTex found that if a linear emissions reduction trajectory is imposed on safeguard facilities, such that their emissions budgets fall in a straight line by 2030, they would need to reduce their emissions by a cumulative 170 million tonnes to comply. to the work climate. target.

RepuTex forecasts provided to age and Sydney Morning Herald shows that over 200 million tonnes of Australian Carbon Credit Units (ACCUs) will be generated by 2030, based on the number of offset projects already registered with the Federal Government.

“The numbers tell us that the Australian carbon offset market has reached scale. We have now issued over 115 million ACCUs [since 2012] … and another 200 million are expected to be issued over the next decade. This provides us with a very large liquid pool of domestic emissions reductions to support the decarbonization of industry,” said RepuTex Executive Director Hugh Grossman.

A shock announcement by former Energy and Emissions Reduction Minister Angus Taylor in March provided an unexpected silver lining for carbon credit schemes.

Taylor has instructed the Clean Energy Regulator to create new rules to allow companies that have been contracted to sell $2.6 billion in carbon credits to the Commonwealth Emissions Reduction Fund to break their contracts and sell them for more at private companies.

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Grossman said the canceled government contracts will release carbon offsets and make them available to companies captured by the safeguard mechanism, and noted the price wasn’t much higher than the $24 a ton under the framework. of the Gillard government program.

“We expect ACCUs to be available above $30 per ton. It’s very competitive. It’s really not that far from where the carbon price mechanism was in 2012 and here we are a decade later,” he said.

“If you told companies ten years ago that they would have access to offsets in 2022 at around $30 a ton, particularly national offsets, they would be very happy.

“Given that we have such a large pool of national offsets, at low cost and with high co-benefits – such as job creation, investment and environmental benefits – it begs the question, what is the need international offsets? said Grosman.

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“International offsets may be better suited to a world where Australia increases its emissions reduction target to a 1.5C trajectory, or where companies are required to offset their emissions downstream,” he said. he declares.

“A lot has changed over the past decade, and as things stand, Australia’s domestic carbon offset market is well positioned to support the industry, unlike a decade ago.”

The volume of carbon credits RepuTex expects to hit the market by 2030 will surprise companies with backup facilities, based on the size of the market when Labor released its Powering Australia policy in December of 2019. last year.

The Minerals Council and the Australian Petroleum Production and Exploration Association (APPEA) have continued to advocate for Australian companies to be able to access international carbon credits.

The Climate Change Authority, set up to provide expert advice on the country’s response to global warming, said in its review of international offsets released on Thursday that Australia should help establish global carbon trading.

“It is in Australia’s national interest to play a leading role in developing a robust, liquid, high integrity, reliable and efficient global carbon market,” the review said.

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