Australia will hold its first auction for carbon-cutting projects under its Emissions Reductions Fund on April 15, the Clean Energy Regular said Friday.

Under the A$2.55 billion ($1.98 bln) fund, project developers can bid for the opportunity to cut carbon emissions, which the government will count towards meeting Australia’s target of cutting emissions to 5 percent below 2000 levels by 2020.

“We will select projects to contract with solely on the basis of the bid price. The best strategy for succeeding at auction is for you to price your project realistically by bidding the lowest price at which it is worthwhile undertaking the project,” the Regulator said.

The first auction will open on 9 AM on April 15, and close 5 PM the following day. Bids will be sealed.

The first auction had originally been scheduled for March, and market analysts Reputex said the delay is likely intended to allow industry to develop more methodologies upon which to base their projects.

Fourteen methodologies are awaiting final determination by the government, with more in the pipeline.

Despite the time pressure, Reputex thinks several firms are likely to place bids in the initial auctioning rounds.

“Industry indicated to the Clean Energy Regulator that it needs more time to prepare its bids for the first auction following the release of the new finalised methods, with a number of firms likely to commence price discovery in the early auction rounds,” Reputex said in a note emailed to clients.

Among the methods under final consideration are industrial fuel and energy efficiency, voluntary carbon projects and a number of land-based methodologies.

By Stian Reklev – stian@carbon-pulse.com