The Clean Energy Regulator will offer an innovative new approach to contracting under the Emissions Reduction Fund.
New option contracts will be offered at the
next auction on 25 and 26 March 2020, on a pilot basis.
Contracts offering an option to deliver give sellers the security of a contracted price for Australian carbon credit units (ACCUs) in order to invest in a new carbon abatement project.
The seller can then choose whether to deliver abatement to the Commonwealth at the contracted price or sell some or all of their ACCUs elsewhere.
Sellers will still be able to bid for fixed delivery ACCU contracts at the March auction.
David Parker, Chair of the Clean Energy Regulator said, “I am very pleased to offer this new approach. The voluntary side of the carbon market is really starting to take off and these option contracts aim to help the market further evolve and mature.”
Increasingly the Clean Energy Regulator could become one among many, with a range of different players buying carbon credits in a dynamic market.
The Clean Energy Regulator is offering option contracts on a pilot basis for the March auction and Mr Parker said “I want to work with industry and learn by doing from our experience with this auction so we can refine and improve the option contracts for future auctions.”
The Clean Energy Regulator’s decision follows public consultation on the option contracts, which began in December 2019. Scheme participants responded positively to the new contracts.
“To maximise chances of being successful at the auction, bids must be competitive. I expect that bids for the option contracts will reflect the value of the more flexible contract offering.”
In addition to the
new Auction Guidelines, which are now available, a new Auction Qualification form and an associated Code of Common Terms will be available shortly for participants interested in an Option to Deliver contract. These are separate to the
Auction Guidelines and Auction Qualification form that remain in force for the existing fixed delivery contracts. If a participant wishes to bid for a combination of both contract offerings, separate qualification forms must be lodged.
People considering registering projects for the March 2020 auction are encouraged to do so as soon as possible. The deadline for project registration is 10 February 2020.
Whether you are a landholder or a large firm, and you are thinking about participating in the Emissions Reduction Fund, call or email us directly with any questions and make sure you don’t miss out on the tenth auction.
You can contact us at
firstname.lastname@example.org or phone 1300 553 542.
participating in an auction for more information
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The Clean Energy Regulator is a Government body responsible for accelerating carbon abatement for Australia.
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