The Clean Energy Regulator of Australia has held the first Emissions Reduction Fund auction, awarding 107 Carbon Abatement Contracts to 144 projects. The projects are expected to deliver a total of 47.3 Mt of abatement, including 28 Mt from sequestration and 18 Mt from landfill and waste treatment methods. The total value of contracts awarded reached A$660m (US$511m) and the average price per tonne of abatement was A$13.95 (US$10.79). This level is deemed to low to attract large polluters, which rather target a A$18/t level. However, power utility AGL (the largest CO2 emitter in Australia) was awarded seven 7-year contracts to cut 1 Mt of emissions through landfill gas projects.
The A$2.55bn (US$1.98bn) Emissions Reduction Fund was set up in 2014 after the controversial A$8bn (US$6.2bn) carbon tax was scrapped. The fund holds reverse auctions, expected to be a cheaper solution to cut Australia's CO2 emissions by 5% by 2020 (compared to 2000 levels). Australia aims to cut emissions by 236 Mt.
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