Insights
Safeguard entities continue to accumulate ACCUs and consolidate their holdings in anticipation of future year compliance obligations. Holdings in Safeguard and Safeguard related accounts increased by 3.0 million to 22.6 million in Q2 2024.
20 million ACCUs are expected to be issued in 2024. In Q2 2024, 3.9 million ACCUs were issued, bringing the first half of 2024 to 7.7 million ACCUs issued. At the end of Q2 2024, there were 297 crediting applications under assessment for an expected 6.4 million ACCUs.
ACCUs delivered under Commonwealth carbon abatement contracts are held in the cost containment measure. At the end of Q2 2024, the cost containment measure held 2.6 million ACCUs. An increase in deliveries is expected between August and December 2024. This is due to delivery milestones being concentrated around the end of financial and calendar years.
The 4th pilot exit window for fixed-delivery carbon abatement contracts was announced in Q2 2024. It includes a requirement to deliver at least 20% of ACCUs in a milestone before the remainder can exit. This window covers 18-months from July 2023 to December 2024. At the end of Q2 2024, 1.6 million ACCUs were delivered against milestones and 1.0 million ACCUs had exited. ACCUs that have exited are no longer under Commonwealth contract delivery obligation and can be used at the owner’s discretion.
A revised total of 7 to 13 million ACCUs is anticipated to exit. This is based on the outcomes of milestone scheduling negotiations conducted as part of our carbon abatement contract management process. Some milestones are being rescheduled out of the exit window in line with our contract management principles. Updates on the volume exited are published with the ACCU project and contract register.
On this page
Market dynamics
Table 1: ACCU supply and demand summary for Q2 2024
| Balance carried forward from Q1 2024 | 38.6 m |
|---|---|
| ACCU supply | 3.9 m |
| ACCU Scheme contract deliveries* | -0.73 m |
| Non-Commonwealth cancellations | -0.42 m |
| Safeguard surrenders | 0 |
| Net balance at the end of Q2 2024 | 41.3 m |
| Cost containment measure | 2.6 m |
*ACCUs delivered under Commonwealth carbon abatement contracts are held in the cost containment measure. These ACCUs will be available to eligible Safeguard entities via the cost containment mechanism.
In Q2 2024, 0.28 million ACCUs were issued to projects claiming for the first time. At the end of Q2 2024, an additional 0.41 million ACCUs were under assessment for projects claiming for the first time. In previous years, most projects claiming for the first time were issued ACCUs in the second half of the year.
Description
This figure shows the volume of ACCUs issued to and the number of projects claiming for the first time each year. This figure also shows the estimated issuance to projects claiming for the first time in Q3-Q4 2024.
This figure is interactive. Hover over/tap each segment to see the number of ACCUs. Hover over/tap along the line to see the number of projects. Click/tap on the items in the legend to hide/show data in the figure.
Small print
For 2024, ACCU issuance and the number of projects are as at 30 June.
In the first half of 2024, 0.93 million ACCUs were delivered under Commonwealth carbon abatement contracts. Most of this volume (0.65 million) was delivered after the announcement of the 4th pilot exit window on 26 April 2024.
In Q2 2024, 0.42 million ACCUs were cancelled, of which:
- 0.28 million ACCUs were cancelled for voluntary purposes
- 0.12 million ACCUs were cancelled for compliance purposes, excluding Safeguard surrenders
- 0.02 million ACCUs were cancelled by or on behalf of government entities.
In 2024, 1.4 million ACCUs are expected to be cancelled for non-Commonwealth demand, excluding Safeguard surrenders. This has been updated from an expected 1 million in the Q1 2024 QCMR.
Description
This figure shows ACCU cancellations by demand source over time.
This figure is interactive. Hover over/tap each segment to see the number of ACCUs. Click/tap on the items in the legend to hide/show data in the figure.
Small print
ACCU cancellations exclude deliveries against Commonwealth carbon abatement contract milestones. This classification system is uniform across ACCU and large-scale generation certificate (LGC) cancellations. Noting, Safeguard demand is included for ACCUs only.
Covered activities for each classification
Voluntary demand
Cancellations made against voluntary certification programs such as Climate Active and any sort of organisational emissions or energy targets.
Safeguard demand
Surrenders made by Safeguard entities to meet Safeguard Mechanism compliance.
Compliance demand
Cancellations made by private organisations and corporations for compliance or obligations against municipal, local, state and territory government laws, approvals, or contracts. For example to meet Environmental Protection Authority requirements.
Government demand
Cancellations by or on behalf of government entities. For example to offset emissions from vehicle fleets or meet voluntary emissions reduction targets.
The generic ACCU spot price remained stable in Q2 2024 averaging $33.47. The spot price ranged from $31.96 on 15 April to $34.45 on 18 June 2024. This is the 10th month in a row that the generic ACCU price has remained above $30.
The premium for human-induced regeneration (HIR) ACCUs narrowed further over Q2 2024, averaging $0.39. A savanna fire management with Indigenous co-benefits trade occurred in Q2 2024 at $50.00.
On 29 July 2024, the Australian Securities Exchange launched its Environmental Futures Exchange. It offers futures contracts for ACCUs, large-scale generation certificates and New Zealand emission units. This provides a new pathway for market participants to secure long-term supply in line with their corporate goals and compliance obligations.
Generic Australian carbon credit unit (ACCU) volume weighted average spot price
Note: This figure is not interactive.
Description
This figure shows the volume weighted average of the generic ACCU spot price over time.
Small print
The generic spot price refers to the daily volume weighted average price of spot trades for ACCUs with an unspecified method. Spot trade data is compiled from trades reported by Jarden and CORE markets, and may not be comprehensive.
Data as at 30 June 2024.
Safeguard entities continue to bolster their ACCU holdings
At the end of Q2 2024, 55% of the 41.3 million ACCU holdings in the Australian National Registry of Emissions Units (ANREU) were held in Safeguard or Safeguard related accounts.
In Q2 2024, the number of Safeguard (excluding Safeguard related) accounts holding ACCUs increased by 2 to 56 in total.
Description
This figure shows ACCU holdings in Australian National Registry of Emissions Units (ANREU) accounts by market participation category over time.
This figure is interactive. Hover over/tap each data point to see the number of ACCUs in millions. Click/tap on the items in the legend to hide/show data in the figure.
Small print
Totals may not sum due to rounding. ACCU holdings data has been revised to include all accounts. Previously, accounts with nil volume at the end of the quarter were excluded, impacting the historical data. The number of accounts still excludes accounts with nil volume at the end of Q2 2024.
Category definitions
Project proponent
An account holder is connected to one or more ACCU Scheme projects. The connection to projects has been determined based on the available project information. Entities may have linkages to projects that have not been disclosed to the Clean Energy Regulator.
Safeguard
Account holders are Safeguard entities that control a single account, or in cases where Safeguard entities control multiple accounts, only those that have surrendered ACCUs for Safeguard compliance purposes or have specified a facility are included. Some Safeguard accounts also engage in trading activity, which may result in holding fluctuations in this category.
Safeguard related
Account holders are companies, such as subsidiaries, that are related to registered Safeguard entities. These accounts do not specify a facility or have not surrendered ACCUs for Safeguard compliance purposes. These ACCU holdings may be used for future Safeguard compliance purposes.
Intermediary
An account holder’s primary operation is to facilitate trading of ACCUs between the supply and demand sides of the market. This also includes accounts that have accumulated ACCUs through the secondary market without known compliance obligations, offset use, or carbon trading/offset services.
Government
Account holders are government entities that are accumulating for voluntary or compliance purposes.
Business
Account holders do not have a direct link to ACCU Scheme projects. Account holders include participants that are accumulating for voluntary purposes.
Cost containment measure
ACCUs that have been delivered under Commonwealth carbon abatement contract milestones after 12 January 2023. These ACCUs will be available to eligible Safeguard entities under the cost containment mechanism.
The 56 Safeguard (excluding Safeguard related) accounts cover 98 (45%) of the total 219 Safeguard facilities. This is based on analysis done by the Clean Energy Regulator. Some facilities may have accounts that aren’t captured in the above analysis or have secured supply that is being held by other parties, such as intermediaries.
Project registrations
In Q2 2024, 60 projects were registered, including:
- 29 agriculture projects, of which:
- 28 were soil carbon projects
- one was the first tidal restoration of blue carbon ecosystems project
- 25 vegetation projects
- 5 waste projects
- one transport project.
Description
This figure shows registered projects under the ACCU Scheme by method type over time.
This figure is interactive. Hover over/tap each segment to see the number of projects. Click/tap on the items in the legend to hide/show data in the figure.
Small print
The 'agriculture' method type has been segregated into 'agriculture - soil carbon' and 'agriculture- other' to highlight growth in the soil carbon sector. The 'agriculture - soil carbon' method includes the ‘measurement of soil carbon sequestration in agricultural systems' method, the ‘sequestering carbon in soils in grazing systems’ method and the 'estimation of soil carbon sequestration using measurement and models' method.
In June and August 2024, we released new online forms for the ACCU Scheme. These forms cover project registration, variation and crediting applications. The system upgrade will reduce processing times. This will result in faster issuance of ACCUs to the market once a claim has been made.
Supplementary figures
Description
This figure shows ACCUs issued by method type over time.
This figure is interactive. Hover over/tap each segment to see the number of ACCUs. Click/tap on the items in the legend to hide/show data in the figure.
Small print
ACCU issuance follows a seasonal pattern for certain method types, including industrial fugitive methods and savanna fire management.
Description
This figure shows ACCU cancellations by method type over time.
This figure is interactive. Hover over/tap each segment to see the number of ACCUs. Click/tap on the items in the legend to hide/show data in the figure.
Small print
These ACCU cancellations in the Australian National Registry of Emissions Units (ANREU) are for purposes other than deliveries against Commonwealth carbon abatement contract milestones. These ACCU cancellations could be voluntary to show progress towards reducing net scope 1 emissions, to meet state or territory regulatory requirements or surrenders for Safeguard Mechanism compliance obligations.