Australia’s big emitters look offshore to offset their carbon pollution


Labor has committed to set pollution limits on the 215 largest polluting facilities and to tighten them over time.

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“What we’re seeing domestically is very high volumes of voluntary demand that’s coming from large corporates and increasingly from investors and speculators like the big four banks,” Mr Grossman said.

Deloitte Australia partner energy transition and decarbonisation John O’Brien said Australian companies were buying certified carbon credits on the international market.

The Australian spot price for carbon credits is about $50 per tonne of carbon abatement but with cheaper labour costs overseas, credits can be bought for as low as $2 a tonne internationally.

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“It’s a lot cheaper to buy good quality projects out of different parts of Asia than it is in the Australian market. Purely from an economic point of view, if a company is looking to offset, it saves money,” Mr O’Brien said.

Federal Energy and Emissions Reduction Minister Angus Taylor has established the Climate Active certification scheme, whereby companies can register their domestic and international credits and get certified if they achieve carbon neutrality.

Companies are required to use at least 20 per cent domestic carbon credits from land-based projects such as tree planting or agriculture.

Mr Grossman said companies were increasing their take-up of Australian carbon credits, which have risen in price from $15 a tonne to $50 over the past year. However, many investors aren’t surrendering their carbon credits to regulators to offset their emissions, opting to hold on to them in the hope of price spikes, or in case future government reform requires them to be used.

“Many large corporates are stockpiling these Australian Carbon Credit Units (ACCU) in advance of future regulation to ensure that they’ve got a pipeline of supply, if policy changes. They’re also viewing ACCUs as a low carbon investment opportunity,” Mr Grossman said.

Many climate campaigners are opposed to the use of carbon offsets, arguing they enable polluting industries to carry on with business as usual, without switching to more sustainable operations.

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