Australian rush to buy cheap CERs

T

he recent Australian rush to buy millions of cheap, soon-to-be-cancelled CP1 CERs has fuelled concerns that the government plans to use them to cover any shortcomings of its Direct Action Plan, even though using international units goes against its long-standing policy.

Australian landfill owners have driven demand for 20-40 million CP1 CERs costing €0.12-0.15 (A$0.18-0.23) in recent weeks, according to European traders. Unused CP1 CERs will be cancelled on Nov. 18 as the compliance period for the Kyoto Protocol’s first commitment period ends.

The landfill owners are buying the CERs as part of a deal with the government to compensate for future income it earned by passing on the costs from Australia’s now-dismantled carbon tax.

Read the Carbon Pulse story - “Concerns grow that Australia will rely on cheap CERs to meet emissions targets”.