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6th ERF auction result – millions more sunk in “vegetation” abatement

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ERFchartThe results of the federal government’s latest Emissions Reduction Fund auction have been released by the Clean Energy Regulator, revealing the purchase of nearly 8 million tonnes of carbon abatement, at an average price of $13.08 per tonne.

In a statement on Thursday, the CER said that the auction, the sixth to be conducted as part of the federal government’s Direct Action climate policy, had delivered the volume of abatement expected, “given the market activity observed prior to the auction.”

“We expected to purchase in the range of $75 million to $150 million at this auction and we have done that—purchasing 7.95 million tonnes of carbon abatement, for a little over $104 million,” CER chair David Parker said.

“Over 26 million tonnes of contracted abatement from the first five auctions has already been delivered, on or ahead of schedule,” he said.

And the Regulator said that having now successfully established a significant base of projects – with a total contracted abatement of more than 191 million tonnes – it would now shift its focus to the delivery of abatement.

The auction results come just days after an independent review of the ERF, by the Climate Change Authority, conceded that the scheme may not deliver as much domestic carbon abatement as hoped, and warned that other policies would need to take up the slack.

Of particular concern, the report noted, was the “significant risk” for the reversal of carbon stored in the 139 million tonnes of vegetation and other soil projects that dominated the scheme so far, through natural events like floods, bushfires and droughts.

Across the course of the first five ERF auctions, the CCA found that a huge 65 per cent of contracts were awarded to vegetation management projects, which credits carbon storage from the regrowth of vegetation by removing stock or fencing off land, or from preventing land clearing.

As you can see in the table below, this trend was continued in the December 6 and 7 auction.

ERFtable

Some stats from the sixth auction:

  •     the Clean Energy Regulator committed to purchase 7.95 million tonnes of abatement on behalf of the Commonwealth
  •    purchasing resulted in an average price per tonne of abatement of $13.08, which is the weighted average price for each Australian carbon credit unit purchased at this auction
  •     26 contracts were awarded for 26 projects
  •     the total value of all contracts awarded was $104 million, and
  •     the largest single contract was for 1.7 million tonnes of abatement and the smallest for 5000 tonnes of abatement

  

Pocket
  • Joe

    The Abbott / COALition railed against Julia / Labor’s ETS ( which the COALition and Rupe’s newsrags dishonestly called a ‘Carbon Tax’ ) But in its 2 years of operation the ETS actually worked, our emissions reduced. Under The COALition’s wet dream of ‘Direct Action’, we / Aussie Taxpayers have spent nearly $2.5 Billions and what did we get as a result…increasing emissions! The real Carbon Tax is The COALition’s ERF…our taxes paying polluters, thank you very much. Now I make a general appeal to the good readers of Renew Economy. Is anyone able to do the sums to calculate the effective ‘COALition Carbon Tax’ under their ERF. I am guessing it would be the total tonnes of so called abatement so far purchased, divided by our taxpayers dollars that have been pissed away buying that so called, abatement.

    • Ken Dyer

      And of course Joe, the whole bloody stupidity of it is that any “carbon abatement” is totally offset by Queensland land clearing that the Newman LNP Government started, and that the Palasczuk Government tried to stop and were defeated by one cross bench vote. What an abysmal waste of taxpayer dollars by the COALition Government, no thanks to Greg Hunt and now of course Frydenberg!
      https://www.theguardian.com/environment/2017/oct/05/alarming-rise-in-queensland-tree-clearing-as-400000-hectares-stripped

      • Joe

        The Hunt and the Frydenberg, two of the worst Environment Ministers ever to sit in the chair. The have been a disgrace. ‘Non Environment Minister’ would be a correct description of their activites.

        • MaxG

          It is all so Orwell it is not funny… we increased the chocolate rations from 32 to 28% (for those who remember). And the Environment Minister is ruining the environment — what an environment minister is for. Crickey…

        • mick

          no way to speak about the worlds best minister 🙂

          • Joe

            Yeah, someone out there taking the pisses.

    • PaulC

      I think that’s about the amount per household which will be delivered by proposed NEG changes. So double the emissions at no net cost. COALition will be very proud of their achievement – perhaps Malcolm will crow about it in his next Q&A ‘lecture’?

      But given Manus and Nauru have cost an alleged $5b, Direct Action looks a half-hearted effort to waste taxpayer money. Of course, I’d note that there’s still time to make things worse before we can finally consign this abhorrent excuse for a government to history! Time will tell no doubt.

      • Joe

        ….and lets not acknowledge the ‘human cost’ of Manus & Nauru. We saw the Dutton sign off on that $70millions of our / Aussie Taxpayer paid ‘hush money’ earlier this year . All so he / The Federal Govt. didn’t get held to public account….what the Aussie Dolts don’t see, hear or know will not hurt them…or The COALition!

        • PaulC

          That’s the tip of the iceberg. Human cost is huge and in common with energy, there is no plan to resolve it! Not to mention the travesty of diverting foreign aid to pay for it.

          But i completely agree that it is the avoidance of scrutiny which is truly corrosive here. Again common ground with energy – and a slippery slope to much worse. Democracy? Not a part of COALition policy it appears.

  • Robert Comerford

    Ahhhh ,yes, the BS scam to pretend we have reduced air pollution by claiming to have stopped land clearing that was never going to go ahead anyway.