Australia on Wednesday released revised CO2 forecasts that cut expected emissions by 2020 by 264 million tonnes – including the purchase of 22 million CP1 CERs – meaning it is on track to over-achieve its goal by 28 million tonnes.
Previous projections estimated Australia would need to close a 236-million tonne gap to meet the target of keeping 2020 emissions 5% below 2000 levels, but as Environment Minister Greg Hunt hinted earlier this month, that number has now been cut to below zero.
“Critics have claimed time and time again that we would not achieve our 2020 target,” Hunt told the National Press Club in Canberra. “Today, I can advise formally that the critics are wrong.”
The 264mt drop in projected emissions was based on the following elements:
– 140 million tonnes as a result of macro-economic trends, reducing emissions from mining and land use.
– 10 million tonnes from an increased share of renewables in electricity generation.
– 92 million tonnes bought in ERF auctions for pre-2020 cuts (incl. future auctions).
– 22 million tonnes from CERs bought by landfill owners as part of the Waste Industry Protocol.
“This remains, however, a conservative forecast and I am hopeful that future updates will show an even greater surplus,” Hunt said.
CO2 GROWTH
But the government announcement did not address the fact that Australia’s emissions continue to grow in the near term as coal has made a comeback in electricity generation after the carbon tax repeal and new coal and LNG projects come online.
“Emissions growth will continue despite the Emissions Reduction Fund (ERF). While the ERF may result in increased carbon removals through forest regeneration, Australia’s emissions growth is still significantly outpacing abatement contracted under the ERF by around 3 to 4 times,” said analysts Reputex in an update.
“After two auctions, the ERF has contracted 93 million credits (ACCUs), to be delivered over the next 10 years. Over the same period, we project real national emissions will grow by more than 350 million tonnes.”
Reputex estimates Australia’s real emissions in 2020 will be 4% above 2000 levels, but that the 2020 target will still be met due to the carryover of 129 million surplus AAUs from the first Kyoto commitment period plus the 22 million recently purchased CERs.
Critics say Australia must strengthen the safeguard mechanism to curb emissions in the next decade, but Hunt said Wednesday the mechanism would help reduce 200 million tonnes of CO2 by 2030.
By Stian Reklev – stian@carbon-pulse.com
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