The December Quarter 2020 Quarterly Carbon Market Report released today by the Clean Energy Regulator shows two records were achieved last year, with 7 gigawatts (GW) of new renewable energy capacity delivered across Australia and 16 million Australian carbon credit units (ACCUs) issued.
David Parker, Chair of the Clean Energy Regulator said the continued rapid growth in rooftop solar PV in the Small-scale Renewable Energy Scheme (SRES) contributed 3 GW of the new renewable energy capacity, with the remaining 4 GW coming from power station accredited under the Large-scale Renewable Energy Target.
“Sustained low technology costs, increased work from home arrangements and a shift in household spending to home improvements during COVID-19 played a key role in the increase of rooftop solar PV systems under the SRES,” Parker said.
Mr Parker highlighted that the 7 GW of new renewable energy capacity delivered across Australia in 2020 exceeded the Clean Energy Regulator’s original estimate of 6.3 GW.
“Several utility-scale power stations commencing generation and being accredited towards the end of 2020 rather than in early 2021 were the primary drivers for the increase,” Parker said.
The report also confirms Australia has met its Large-scale Renewable Energy Target of 33,000 gigawatt hours (GWh). The Clean Energy Regulator expects eligible generation could reach 40,000 GWh in 2021.
Australia has added on average more than 6 GW of renewable capacity each year since 2018. This level of investment is expected to continue through to 2022, reshaping Australia’s electricity sector.
“It comes as no surprise that total renewable generation in the National Electricity Market (NEM) has climbed to over 30 per cent at the end of 2020, up 5 per cent compared to the previous year.” Mr Parker said.
2020 also saw a record 16 million ACCUs issued owing to a 25 per cent increase in crediting for savanna burning and 17 per cent increase in crediting for vegetation projects.
“This was an 8 per cent rise from 2019, a trend we are expecting to continue in 2021,” Parker said.
Quarter 4 2020 saw the highest quarterly registration (71 projects) since Quarter 3 2015, taking total project registrations for the year to 158.
“In 2020 we had four times as many project registrations as 2019 and the second highest registrations since the establishment of the Emissions Reduction Fund (ERF). This is an incredibly pleasing achievement, as these new projects will potentially result in 50 million tonnes of emissions reductions over their lifetime,” Parker said.
“Voluntary emissions reduction activity continues to gain momentum, with corporations and state and territory governments surrendering 4.9 million Australian units and certificates to offset emissions in 2020, a four-fold increase compared to 2019.”
“Over 156,000 LGCs were voluntarily surrendered in Quarter 4 2020, up 84 per cent compared to the same period in 2019. This increase was primarily driven by surrenders for renewable energy commitments by corporate entities,” Parker said.
Increased transparency in relation to offsetting activities is being sought by supply chains, businesses, shareholders and the public.
That is why the Clean Energy Regulator is consulting on the design of a new Corporate Emissions Reduction Transparency report to help National Greenhouse and Energy Reporting corporations show how they are meeting their voluntary emissions reductions goals.
Funding the Clean Energy Regulator to accelerate the emergence of an exchange traded market for offset units will also act as a catalyst for further private sector investment.