Carbon market breaks records for abatement
26 February 2020
Australia set a new record for carbon abatement in 2019 with even higher abatement forecast for 2020, according to new data from the Clean Energy Regulator (CER).
In its latest carbon market report, the CER found abatement from the Emissions Reduction Fund (ERF) and the Renewable Energy Target (RET) reached 50 million tonnes in 2019 and is expected to increase to 59 million tonnes in 2020.
Minister for Energy and Emissions Reduction Angus Taylor said ERF projects resulted in the issue of 14.8 million Australian Carbon Credit Units (ACCU) in 2019, and more supply to the tune of over 16 million units is expected in 2020.
“These projects deliver on-ground practical action to reduce emissions, providing benefits to our farming and Indigenous communities, and providing a way for business and industry to offset their emissions,” Minister Taylor said.
“The Climate Solutions Fund offers new flexibility to grow total ACCU supply in partnership with state and territory governments.”
In March the CER will trial new delivery contracts at the coming ERF auction to reduce investment risk for project developers. This is expected to accelerate project registrations creating even more abatement.
The report recognised that while the bushfires had a devastating impact across communities in rural and regional Australia, they did not have a material impact on projects registered under the ERF. However, it acknowledged bushfire smoke reduced the generation from solar PV in affected areas.
The CER report also found that renewables investment remains strong, with 2GW of utility-scale renewable energy projects reaching financial close in 2019, proving that the RET has not acted as a cap on investment.
The key challenge to ensuring continued strong growth in new renewable capacity is to drive down the cost of storage and backup as well as transmission and grid upgrades.
That’s why the Government is supporting Snowy 2.0 and MarinusLink, established a $1 billion Grid Reliability Fund and recently announced support terms for the first two projects through the Underwriting New Generation Investment program.
These are important initiatives in the Government’s A Fair Deal on Energy policy and will contribute to meeting our $70 per MWh price target.
View our energy policy blueprint here: https://www.energy.gov.au/energy-policy-blueprint-fair-deal-energy.
Media contact: Minister Taylor’s office: 02 6277 7120