Some limits apply to the proportion of a liable entity’s ACCUs that may be used by a liable entity to meet its compliance liability until 1 July 2015: see Pt 6 of the Clean Energy Act.

 

It is important to note that both Kyoto ACCUs and non-Kyoto ACCUs are financial products.

 

ELIGIBLE INTERNATIONAL EMISSIONS UNITS

 

A variety of emissions units issued and traded in international carbon markets are recognised under the Clean Energy Legislative Package as EIEUs. EIEUs are financial products.

 

The main types of international emissions units recognised under the Clean Energy Legislative Package are those issued under the Kyoto Protocol. These are:

 

(a) certified emission reductions (CERs) (other than temporary CERs or long-term CERs;

(b) emission reduction units (ERUs); and

(c) removal units (RMUs).

 

Section 4 of the ANREU Act sets out which types of international emissions units are recognised under the Clean Energy Legislative Package. Other types of units may be prescribed by regulation as EIEUs from time to time.

 

ASIC indicates that while CERs are issued outside Australia in accordance with the relevant provisions of the Kyoto Protocol, ERUs and RMUs may be issued either outside or within Australia.

 

Generally, all EIEUs will be eligible for surrender by liable entities to meet their surrender liability under the carbon pricing mechanism from 1 July 2015. Regulations to the Clean Energy Act may also deem certain types of EIEUs (e.g. those derived from certain types of offsetting projects) ineligible for surrender.

 

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