Products and services for the environmental market

The Environmental marketplace in Australia

Australia has been a leader in market-based policies to reduce greenhouse gas emissions and increase the use of renewable energy. The 2001 national Mandatory Renewable Energy Target and its associated markets was the first scheme of its kind globally. In 2003, the NSW Government introduced the world’s first mandatory carbon trading scheme, the NSW Greenhouse Gas Abatement Scheme.

Because Australian carbon regulations evolved concurrently at the State and Federal level, a number of existing schemes overlap. These include:

  • A Mandatory Renewable Energy Target (MRET), introduced by the Australian Government in 2001, to increase the generation of electricity from renewable energy sources by 9500GWh in 2010;
  • The New South Wales Greenhouse Gas Abatement Scheme (NGAS), a carbon trading scheme introduced by the New South Wales Government in 2003, to reduce greenhouse gas emissions associated with the production and use of electricity;
  • The Qld 13% Gas Scheme or GEC Scheme (see GEC) introduced by the Australian State of Queensland, to increase the proportion of electricity generated using gas;
  • A Victorian Renewable Energy Target (VRET) which, since 2006, has been working at a state level to increase electricity generation from renewable energy sources to 10% by 2016;
  • The Greenpower scheme, a national voluntary scheme which allows consumers to purchase all or part of their electricity requirements from a renewable energy source such as a wind or hydro-electric scheme;
  • The Victorian Energy Efficiency Target (VEET) scheme to improve residential energy efficiency.

The recently elected Federal Labor Government is working to consolidate current initiatives, in line with its broader policy objectives of achieving deep cuts in greenhouse gas emissions. This process would result in two ultimate schemes:

  • The Carbon Pollution  Reduction Scheme, aiming to reduce greenhouse gas emissions to a yet to be agreed level in satisfying Australia’s obligations under the Kyoto Protocol.
  • An expanded national Renewable Energy Target (MRET), aiming to increase the proportion of electricity generation from renewable sources to 45,000 GWh by 2020.

These policies would substantially increase underlying demand for carbon instruments in Australia. Significant development is required to ensure the market continues to provide an effective risk management tool. In particular, formal and transparent markets are needed to link Australia to global carbon markets, increase market confidence, and attract liquidity providers.

Envex is positioning itself to play a key role in the development of these markets.