The Clean Energy Regulator (CER) has bought over 45 million tonnes of abatement at an average price of $12.25 a tonne at the second Emissions Reduction Fund auction.
“We were pleased with the high level of participation and competitive bidding which has allowed us to source significant abatement at a lower average price than the first auction,” said Chloe Munro, CER Chair.
The Regulator has awarded 129 carbon abatement contracts, ranging from one to ten years in length, for a total value of almost $557 million.
The market was advised ahead of the auction that the CER would buy between 50 and 100 percent of the abatement on offer below the benchmark price.
“We have accepted 72.3 per cent of the volume offered. This was the point that represented best value in the range of bids, balancing total cost and total volume,” Ms Munro said. “This result shows we can secure high volumes of abatement without compromising on price.”
The portfolio of carbon abatement contracts from both auctions will deliver almost 92.8 million tonnes of abatement at an average price of $13.12. This represents a total commitment of $1.2 billion in round terms.
Successful projects include the Eastern Creek UR-3R facility in New South Wales, which turns household organic waste streams into compost.
The Clean Energy Regulator has yet to set a date for the next auction, but intends to announce details as soon as possible.