The Clean Energy Regulator has today announced that the seventh Emissions Reduction Fund auction will be held from 6–7 June 2018.
David Parker, Chair of the Clean Energy Regulator said we recognise the importance of regular purchasing events in providing participants with the opportunity to underpin a carbon abatement project.
"At this auction, a number of new and anticipated methods will provide additional opportunities for participation, including the recent release of the agricultural systems soil carbon method that has already had strong interest from the land-based sector."
Over $265 million remains available to purchase abatement at this and future auctions.
"We are in no rush to commit all of the remaining funds at this auction. As always, our focus is on purchasing the best value abatement available in the market. We expect to hold another purchasing process later in the year," Mr Parker said.
"We again advise all participants to bid at the lowest price that you can undertake your project to avoid disappointment. Results from previous auctions show there is a high probability of getting a contract if you bid competitively," Mr Parker said.
"We expect to spend somewhere around $50 million to $100 million at the next auction. This will serve to consolidate the existing portfolio, and build a portfolio of deliveries out to 2030," Mr Parker said.
The auction process provides one avenue for projects to secure a purchaser for Australian carbon credit units, but there are other commercial opportunities available. Scheme participants have the option to offer only part of the expected abatement from a project into the auction process. They may trade further units they generate through contracts with other parties.
The Clean Energy Regulator has made minor changes to the guidelines for this auction. In previous auctions, the guidelines allowed the agency to purchase between 50 and 100 per cent of available abatement below the benchmark price. From this auction, the agency will be able to purchase between 25 and 100 per cent below the benchmark price.
"This will provide additional flexibility and ensure we are meeting the purchasing principles in the legislation that underpin the auction process," Mr Parker said.
Those interested in participating in this auction have until 20 April 2018 to register their projects and until 7 May 2018 to qualify to participate in the auction.
For auction guidelines and details about the auction process see Participating in an auction.
The Emissions Reduction Fund is a voluntary scheme that aims to provide incentives for a range of organisations and individuals to adopt new practices and technologies to reduce their emissions. It is enacted through the Carbon Credits (Carbon Farming Initiative) Act 2011, the Carbon Credits (Carbon Farming Initiative) Regulations 2011 and the Carbon Credits (Carbon Farming Initiative) Rule 2015.
A number of activities are eligible under the scheme and participants can earn Australian carbon credit units (ACCUs) for emissions reductions.
One ACCU is earned for each tonne of carbon dioxide equivalent (tCO2-e) stored or avoided by a project. ACCUs can be sold to generate income, either to the government through a carbon abatement contract, or in the secondary market.
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