Australia on Tuesday deemed five new project types eligible to sell carbon reductions to its Emissions Reduction Fund (ERF), one week ahead of the first auction.
The methods were released on the website of the Clean Energy Regulator, who will administer the A$2.55 billion (1.96 bln) fund.
The regulator said it had approved the following project types:
– Fuel efficiency in industrial electricity;
– Aggregation of electricity consumption savings from small energy users;
– Savanna burning (including low rainfall);
– Avoided deforestation (updated version); and
– Capture and combustion of methane from wastewater treatment.
Successful bids in next week’s auction are expected to be dominated by land-based projects, but as more methods related to industry and electricity generation get approved, observers say those projects are likely to offer emission cuts at cheaper rates.
The Regulator on Tuesday also clarified rules for how to sell credits to the government under the auction for those who have already received ACCUs under the Carbon Farming Initiative.
Companies can bid for immediate delivery if they offer which ever is the lowest of a minimum of 15,000 ACCUs or 10% of the estimated forward abatement, it said.
Projects can only enter into immediate delivery contracts with the government once a year.