Below, we provide an extract from our latest Market Update, “Reviewing the ERF Safeguard Mechanism – Toothless Tiger or Hidden Dragon?” released this week.
In order to better understand the coverage of the proposed ERF Safeguard Mechanism, and the potential size of Australia’s new compliance market, analysis initially projected individual facility greenhouse gas emissions (GHG) for each “covered facility” (emissions over 100,000 t/Co2e) out to the fiscal year (FY) 2025 in order to identify baseline exposure.
Analysis then overlayed proposed safeguard rules in order to examine the impact of policy on exposed emissions and compliance demand for ACCUs, notably the treatment of the electricity sector, the setting of “high point” baselines and the treatment of new and expanding facilities.
Figure 3 above breaks out historical emissions data for the years FY 2009-10 and FY 2013-14 for the 256 facilities identified to be covered under the scheme. These years are of particular interest as they span the safeguard historic baseline period.
Facilities displayed below the solid black line represent facilities that reduced emissions in FY13-14 against FY09-10 levels, while facilities above the solid black line have increased emissions in FY 2013-14 from FY09-10.
In total, 114 facilities increased emissions from FY2009-10
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