As discussion increases over the role of domestic and international carbon credits in Australia, in this Insights article, we discuss our latest outlook for supply of Australian carbon credit units (ACCUs) through to 2030.
Analysis maps total volume of supply, and estimated offset prices, based on forecast demand from entities covered by the National Emissions Guarantee (NEG) and safeguard schemes, providing an initial price guide for covered facilities, and a reference point for offset developers active in the ERF and secondary market.
Below, we summarise the key findings and implications for market actors.
Domestic offsets may be the marginal source of emissions reductions in Australia
While international carbon offsets have historically been viewed as “low cost”, we anticipate a steep curve for units in markets such as Europe and California – and potentially China – with carbon prices likely to grow to A$30-120 in 2030, reflecting the higher ambition of these schemes.
Coupled with the limited role of Kyoto units – Certified Emission Reductions – after 2020, the high forecast price of international credits provides important context for Australian companies, with strong potential for domestic offsets to be the marginal source of emissions reductions in the Australian market.
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