New Energy Bulletin: Clean Energy Regulator’s consultation paper – ‘Enabling deep, liquid, transparent and accessible carbon markets in Australia’

The Australian Clean Energy Regulator (CER) provides key system infrastructure, information, and reporting processes to support the Australian carbon market, including the tracking and trading of Australian carbon credit units (ACCUs), Safeguard Mechanism credit units (SMCs), large-scale technology certificates (LGCs), and small-scale technology certificates (STCs).

On 11 October 2024, the CER announced that a new Unit and Certificate Registry (Registry) capable of connecting with other platforms and exchanges will replace the existing Australian National Registry of Emissions Units.¹

Alongside this announcement, the CER published a consultation paper that invites stakeholder feedback to:

1. identify key market needs and priorities for the establishment of new market infrastructure, including a modern registry that allows multiple pathways; and
2. test the feasibility of establishing a mechanism for exchanging trading of ACCUs.²

Objectives of the new Registry

The main objectives of this new Registry include:

1. streamlining the trading process for account holders by improving interoperability with trading platforms, market operators, and the back office systems of market participants.
2. centralising various tradeable unit and certificate types which will improve accessibility, liquidity, and transparency in the Australian carbon market.
3. enabling exchange-trading of a beneficial interest in ACCUs to increase market liquidity, improve price discovery, and reduce transaction costs to increase participation across.³

Notably, the CER has established a criterion within the consultation paper based on the specific system criteria and authentication requirements to assess the eligibility of external systems to connect to the Registry.⁴

Transition to the Registry

Units and certificates will be systematically transitioned to the Registry, commencing with SMCs in 2024. Following this initial phase, Renewable Energy Guarantee of Origin certificates, Nature Repair Market certificates, and ACCUs will be onboarded throughout 2025. LGCs and STCs are expected to remain within the current Renewable Energy Certificate Registry.⁵

Participating in the consultation

The consultation is open to:

1. carbon market and scheme participants, including entities creating, holding and trading carbon units and certificates;
2. safeguard facilities; and
3. consultants, brokers and intermediaries.⁶

Stakeholders are invited to make submissions online or via email at market-engagement@cer.gov.au using the consultation coversheet by Friday 22 November 2024.⁷ The CER will release outcomes of submissions in early 2025.

The Hamilton Locke New Energy team is available to discuss how the new Registry may affect your participation in the Australian carbon market, and to assist in making a submission in relation to the consultation.

The Hamilton Locke team advises across the energy project life cycle – from project development, grid connection, financing, and construction, including the buying and selling of development and operating projects. For more information, please contact Matt Baumgurtel.

¹‘Carbon market infrastructure for holding and trading certificates and units’ (Web Page, 11 October 2024) <https://cer.gov.au/news-and-media/public-consultations/carbon-market-infrastructure-holding-and-trading-certificates-and-units>.

²Australian Government, Clean Energy Regulator, ‘Enabling deep, liquid, transparent and accessible carbon markets in Australia’ (Discussion paper, 11 October 2024) 4.

³Ibid, 14.

⁴Ibid, 11.

⁵Ibid, 9.

⁶‘Carbon market infrastructure for holding and trading certificates and units’ (Web Page, 11 October 2024) <https://cer.gov.au/news-and-media/public-consultations/carbon-market-infrastructure-holding-and-trading-certificates-and-units>.

⁷Ibid.