The Australian government plans to authorise its AUD2bn (US$1.3bn) Climate Solutions Fund to finance carbon capture and storage (CCS) projects. In addition, the government proposes to award credits to enterprises for implementing low-emissions solutions, including CCS, which would be used to meet their climate obligations under the safeguard mechanism. The scheme fixes an emission ceiling for a facility, above which it must acquire abatement.
The Emissions Reduction Fund, Australia’s first carbon abatement fund, was created in 2014 and committed AUD2.2bn (US$1.5bn) for 190 Mt of emissions reductions. In 2019, it was renamed the Climate Solutions Fund. As part of the Climate Solutions Package, the country plans to invest AUD3.5bn (US$2.3bn) to achieve its 2030 Paris commitments. Australia’s NDC aims to reduce GHG emissions by at least 26% below 2005 levels by 2030.
In March 2020, Australian independent gas producer Santos signed a preliminary, non-binding agreement with BP to fund a 1.7 Mt/year CCS project in South Australia. Once the agreement is finalised - the final investment decision (FID) is expected by the end of 2020 - BP could invest AUD20m (US$13m) in the Moomba CCS project. Santos is currently conducting front-end engineering design (FEED) for the proposed CCS project. It aims at capturing the 1.7 Mt/year of CO2 currently separated from gas and to reinject it into a former gas reservoir. The project could be expanded at a later stage to a capacity of 20 Mt/year.
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