The Australian Government will become the first national government to award carbon capture and storage (CCS) projects with carbon credits that are intended to offset emissions.
Australian Carbon Credit Units (ACCUs) can be earned by the projects with each ACCU representing one tonne of carbon emissions ‘avoided’.
As part of the Morrison Government’s Emissions Reduction Fund (ERF), ACCUs will be able to be sold to the Australian Government at auctions or on the private voluntary market.
Angus Taylor, Minister for Energy and Emissions Reduction, said that the ERF method will support investment in large-scale CCS hubs.
“CCS is a priority under the Government’s Technology Investment Roadmap and the new ERF method will incentivise emissions reductions from a range of energy-intensive sectors including liquefied natural gas (LNG) production,” he added.
Stating that the Government wishes to reduce emissions without imposing new costs on Australian households and business, Taylor said that the new scheme will also support the production of clean hydrogen from existing energy resources.
In addition, the Government will explore the use of biogases, livestock feed technologies, and direct air capture (DAC) technologies from 2022.