Australia eyes carbon exchange launch by early 2025

Market: Emissions
19/12/23

Australia's Clean Energy Regulator (CER) expects its planned Australian Carbon Exchange to be launched between late 2024 and early 2025, pending consultation with market participants.

The CER announced on 19 December that it entered into a contract with technology solutions provider Trovio Group to develop and deliver a unit and certificate register for the Australian National Registry of Emissions Units, paving the way for the setting up of the carbon exchange at a later stage. The registry is expected to be operational in the second half of 2024.

"In addition to the exchange trading option and direct transfers between trading partners, we will be looking to allow other trusted digital trading platforms to connect to the new carbon register subject to security requirements and the necessary regulatory licences," said CER general manager Mark Williamson.

The new register will consolidate the CER's current registers, progressively holding Australian Carbon Credit Units (ACCUs) and international units, as well as large-scale generation certificates, or LGCs and small-scale technology certificates. Over time it will support any new future units and certificates, including safeguard mechanism credit units and guarantees of origin for renewable energy, hydrogen and any other low emissions production, the CER said.

The CER also announced it is working with Australian Securities Exchange to develop an effective model for a carbon exchange market. This will initially support the trade of ACCUs but is likely to extend in the future to other certificates such as LGCs.

The regulator plans to meet with carbon market participants, advisers, digital carbon platform operators and regulators in early 2024 to discuss the detail of the proposed new trading options.

The Australian Carbon Exchange project started in 2021 with the aim of establishing a trading market for ACCUs and support increasing demand from the corporate sector. The carbon exchange will operate like a stock exchange, for the purchase, clearing and settlement of ACCUs.

By Juan Weik

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