The Clean Energy Regulator’s latest Quarterly Carbon Market Report, released today, confirms a record 16 million tonnes of emissions reductions (Australian Carbon Credit Units or ACCUs) were credited under the Emissions Reduction Fund (ERF) in 2020.
This is eight per cent higher than the previous record of 14.8 million ACCUs issued in 2019. The Regulator forecasts a further six per cent increase in 2021 with more than 17 million ACCUs expected to be issued.
The Clean Energy Regulator also found that 158 new ERF projects were registered in 2020, despite COVID-19. This is the second highest on record and four times as many as in 2019.
New projects registered in 2020 have the potential to deliver 50 million tonnes of abatement over their lifetime.
Minister for Energy and Emissions Reduction Angus Taylor said Australia has one of the world’s largest and most sophisticated offset programs in the ERF.
“The Morrison Government is taking real and meaningful action to reduce emissions through the ERF,” Minister Taylor said.
“The ERF continues to back projects that deliver on-the-ground practical action to reduce emissions, providing benefits to our farming and Indigenous communities, and is helping business and industry to offset their emissions.”
More than 88 million tonnes of abatement have already been delivered under the ERF, with a further 135 million tonnes under contract in 2020 at an average price of around $12 per tonne.
In May 2020, the King Review recommended the Government accelerate the development of new ERF methods.
Through the 2020-21 Budget, the Government committed over $40 million of additional resourcing to the Clean Energy Regulator to halve the development time of new methods to less than 12 months.
This year, five new methods will be developed including blue carbon, soil carbon and carbon capture and storage.
Under the ERF, more than $575 million has already been paid to projects in regional and rural areas, with an additional $1.4 billion committed.
Additional funding is also available through the $2 billion Climate Solutions Fund, and voluntary private sector purchasing of ACCUs is increasing rapidly. According to the report, 841,000 ACCUs were cancelled by the voluntary private market and states and territories in 2020, a 76 per cent increase on 2019.
The report also confirms Australia has achieved its Large-scale Renewable Energy Target of 33,000 gigawatt hours (GWh).
The Clean Energy Regulator has confirmed a record 7 GW of new renewable capacity was installed in 2020, and estimates that eligible renewable generation in 2021 could be up to 40,000 GWh, exceeding the 2020 target by up to 21 per cent.