Australian Carbon Pollution Reduction Scheme

The Australian Government is seeking to legislate an emissions trading scheme as part of an effective framework for meeting the climate change challenge.

The Australian Carbon Pollution Reduction Scheme (Au CPRS) is significant for New Zealand as the NZ ETS references the Au CPRS for allocation to trade exposed industry.

Background Materials:

Implementation Delay Announced 4 May 2009

The Australian Government announced on the 4^th of May 2009 its decision to delay the introduction of the CPRS until July 2011. This has been done to allow Australia more time to recover from the impact of the current global financial crisis.

For the first year of the Australian CPRS a fixed price for carbon will be set at A$10/tCO2-e. Full trading will start in the 2012-13 year. In 2010 the price caps for the 2012-2013 and 2013-2014 years will be set out in regulations.

The price cap will be in place for four years from 2012-13, rising at five per cent in real terms (calculated using the CPI), and the future shape of the permit price cap will be reviewed at the first independent review, which will occur by the mid 2014, in line with the original White Paper timing.

In addition, both categories of polluters will receive an increased quota of free permits ("Global Recession Buffer"):

• Trade exposed energy intense emitters will get their free permit quota raised to 94.5% from 90% and
• Second category emitters will get their free permit quota raised to 66% from 60%.
  These free permit levels will be available for the first 5 years.

The Australian Government has also announced the aim to reduce Australia's emissions by 25% of 2000 levels by 2020 from previously 5 to 15% of 2000 levels. This is however conditional and will depend on international action.

The Australian Government says that these changes have been made to meet the opposition and to enable it to get the CPRS legislation through the Senate and Parliament before the COP meeting in Copenhagen in December 2009

• More information on the delay is available here: http://www.climatechange.gov.au/whitepaper/measures/index.html

CPRS Draft Legislation Released 10 March 2009

The Exposure draft of the Carbon Pollution Reduction Scheme Legislation (The Bill) was released on the 10^th of March 2009.

The Bill follows on from the White Paper (released in December 2008) and the Green Paper (released in July 2008). The Bill is the culmination of a process involving broad consultation and the White paper was published having taken into account input from more than one thousand submissions.

The Bill and accompanying fact sheets can be found here

Submissions closed on the 14^th of April 2009.

Australian Emission Trading Scheme Design

The Australian Government released the White Paper on Monday 15 December 2008. The paper outlines the final design of the Carbon Pollution Reduction Scheme and the medium-term, target range for reducing carbon pollution.

This paper follows from the Green Paper, released in July 2008, which canvassed options on the design on the scheme. It takes into account the outcomes of a broad consultation and input from more than one thousand submissions.

For more information refer to the

• Carbon Pollution Reduction Scheme Home Page
• White paper Index
• Green Paper Index

The timetable for implementation of emissions trading in Australia is shown below:

Related Au ETS sites & reports

• Garnaut Review
• National Emissions Trading Taskforce Report
• Prime Ministerial Task Group on Emissions Trading - Final report
• More publications

Learn More

• Our Services - The Journey to Trading
• The ETS Basics
• ETS Design Parameters
• Emission Units and Pricing
• New Zealand ETS Policy