Carbon Match: Carbon market update
Wednesday 11 May 2022
These have been finalised / announced in principle at tighter levels than previously signalled by Government last year. The first budget instead now looks to be back in line with original recommendations made by the Climate Change Commission, with the following two budgets looking tougher than those proposed in last year's advice from the Commission.
Cabinet has agreed that the first three emissions budgets will be:
Emissions Budget 1 (2022–2025): 290 megatonnes of carbon dioxide equivalent greenhouse gasses (72.4 megatonnes per year)
Emissions Budget 2 (2026–2030): 305 megatones (averages 61 megatonnes per year) [in principle]
Emissions Budget 3 (2031–2035): 240 megatonnes (48 megatonnes per year) [in principle]
Emissions budgets are to be met with domestic action alone.
This announcement comes ahead of the Emissions Reduction Plan document to be released next Monday 16th, which in turn will precede the release of "Budget 2022", also to be released next week on Thursday, with climate change mitigation and adaptation expected to be a key theme.
The most recent auction monitor report (in relation to the Q1 March auction) has also now been released, revealing that, on the face of it, 50% of volume sold at auction was to entities with a compliance obligation in their own right.
Of interest is that the top five successful bidders took away 78% of the approx 10.5 m NZUs sold, with the top single buyer accounting for 35.4%, though of course all such buyers might well have been buying for a number of other entities.
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