THE market for Australian Carbon Credit Units has reached a four-month high after weeks of small price fluctuations and low numbers traded.

According to Jarden, ACCUs closed Monday at $32 per tonne of CO2 or equivalent – which is the highest the price has been since July. The market has been hovering around the $30 mark for the past four months.

Market information service Reputex Energy says record numbers have been traded in the past week.

“The surge in activity, driven by increased corporate and hedging activity, spurred a jump of over 5 percent in prices for both Human Induced Regeneration (HIR) and Generic (landfill gas) ACCUs, indicating some early confidence in the outcome of the Safeguard Mechanism review,” the latest monthly update says.

The Safeguard Mechanism is the legislation used to force big polluters to offset any emissions over a certain baseline set for their companies. Labor is proposing to make those baselines decline over the years.

Chubb-review still in progress

Political decisions have largely been responsible for fluctuations in the carbon market over the past year – with the previous Federal Government allowing project holders to exit government contracts causing the price to halve in February this year.

Another factor contributing price fluctuations has been a group of scientists from the Australian National University raising serious concerns about the integrity of a large number of ACCUs currently being generated.

The concerns have resulted in a Federal Government review, headed up by Professor Ian Chubb, to be handed down before the end of the year. Several agricultural entities, including the National Farmers Federation, NAPCo and AA Co, have made submissions.

With all eyes on the findings of the review and subsequent actions from the government, Prof Chubb gave the Carbon Market Institute’s (CMI) Australian Emissions Reduction Summit last month an insight into some of the themes coming away from the investigation.

“A widespread call for increased transparency, particularly to allow third party assessments and validation, given the data is presently not available to those parties,” he said

“Offsets integrity standards need to allow for improvements and realignments in response to changes. There has to be capacity to adjust and improve as new opportunities arise.

“A widespread view that governance of the scheme should better reflect best practice in distribution of responsibilities. There is a view, through no fault of its own, that the regulator has been asked to do multiple tasks which some people see as a potential for conflict and that we should seek to simplify.

“More flexibility and agility [is required] to update new technology in response to new scientific information.

“A significant effort should be made to provide more opportunities for First Nations expert advice and project participation than there presently is, based on the way the scheme is structured.”

“There was significant input on the importance of co benefits – environmental, economic, social and cultural, particularly communities.”

Carbon on the agenda at COP 27

Global carbon market rules have been on the agenda at the Conference of Parties (COP27) Summit in Egypt.

The main item up for debate is called article 6 of the Paris Agreement, which allows countries to trade emissions reductions.

CMI CEO John Connor, who is in Egypt, said there was a lot to do in negotiations this week.

“The challenge will be to build on the momentum from COP26 and in the negotiations last week to create a pathway for accelerated investments in decarbonisation and support for impacted communities,” Mr Connor said.

“In the halls around the formal negotiations there has been an important focus on corporate accountability around net zero emission claims and we expect more on the evolving ecosystem of integrity and transparency for international voluntary carbon markets this week.”

• Keep track of the Australian carbon market on Beef Central’s industry dashboard