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The Energy

Pain ahead for carbon credit holders

Published about 12 hours ago • 6 min read

Hey Reader, in today's edition:

  • Fallout from ACCU policy change
  • Solar sharer wins few fans
  • Ausgrid smart meter business up for sale

Costly end to Emissions Reduction Fund

The burial of a key former Abbott government policy for encouraging carbon abatement projects will be slow and financially painful for participants that overcommitted themselves and may have to pay tens of millions of dollars to the federal government to cover shortfalls.

The Abbott era Emissions Reduction Fund policy offered to buy and extinguish Australian Carbon Credit Units or ACCUs from developers of carbon abatement projects using soil sequestration, reafforestation and vegetation regeneration methods at agreed prices.

But consultancy Reputex, which studies the market for ACCUs, says some 84 million ​​ACCUs remain outstanding under “Fixed Delivery” Carbon Abatement Contracts, with the majority unlikely to meet the conditions for taking advantage of a new permanent exit arrangement implemented by the Albanese government in December.

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Solar Sharer wins few fans

A cap to stop excessive use and a mechanism to allow retailers to recover supply costs are among several design principles the government has handed to the Australian Energy Regulator to guide the delivery of its controversial Solar Sharer Offer.

Retailers had asked for more time or a trial period to better assess the way the offer works in practice, but the government is sticking steadfastly to its July delivery timeline, despite acknowledging it is “ambitious”. The plan was first announced in November last year.

The government said it had found “broad support” for the scheme during its short consultation period, however retailer lobby group the Australian Energy Council said the “rushed” plan meant many consumers were unlikely to see meaningful savings. And consumer groups argue it’s unlikely to deliver the benefits envisaged for households that don’t have solar, or the energy system.

Expert view

“The challenge of predicting anything with Solar Sharer is that no one knows how many people will actually take it up or how much they will actually change their behaviour. It could turn out to be either a non-event or a major disruption.

So, here’s an idea for the retailers. From 1 July, analyse and publish data on how Solar Sharer customers are responding to the new incentives.

The actual amount of load that customers shift will determine how much they save, how much retailers save (in lower wholesale costs) and lose (in lost revenue). The size, timing and location of that load will determine whether it helps or harms the network.

This data would be trivially easy for retailers to compile, anonymise and publish. And creating a quick feedback loop back to government will be important for spotting issues early and resolving them.”

Hamish McKenzie
Deputy Director - Climate Change & Energy, Grattan Institute

Catch Up

Capital

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Ausgrid is moving forward with a plan to sell its Plus Es smart meter business. The company currently has 36% of the smart meter market, and is expecting continued growth on the back of the rule maker’s 2030 deadline. Analysts are expecting a deal value of between $2 and $3 billion. (AFR)

Global investment in the energy transition is proving resilient, BloombergNEF said, reporting a record US$2.3 trillion in investment in 2025, up 8% on the previous year. Despite the growth, which was dominated by electrified transport, renewable energy and grid investment, renewable energy investment fell 9.5% year-on-year, due to changing power market regulations in China. Investment in India and the EU helped offset slower investment elsewhere. Maintaining alignment with net-zero pathways will require a major uptick in wind manufacturing spending, the group said, while battery metals could face long-term misalignment if the pace of future additions slows as currently projected.

Meanwhile, Clean Energy Regulator data showed major solar and wind investment in Australia totalled 2.1 gigawatts in 2025, compared to 4.3GW in 2024, marking the third worst year in a decade for utility scale wind and solar final investment decisions. (The Australian)

Batteries continue to boom despite the challenges in utility wind and solar, with Rystad Energy forecasting large-scale batteries will make up a greater share of Australia’s electricity grid than gas by 2027. (AFR)

Projects

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Three offshore wind projects were offered feasibility licenses in the Bunbury zone off Western Australia. Two are being developed by the Australian arm of the French government's EDF Group, and the other by a joint venture between Spain's EDP Renewables and France's ENGIE. The government said no applications were able to be progressed to licence in the Illawarra, and a lack of competitive bids meant it also chose not to offer any licenses in the Bass Strait.

Energy Minister Chris Bowen also opened applications for research and demonstration licences that allow trials and testing of offshore renewable technology in all six offshore wind zones. And Victorian Victorian Energy Minister Lily D’Ambrosio said the delayed offshore wind auction that had been scheduled for September will now be held in August.

The UK signed a clean energy pact with European allies under which the UK, together with Germany, Norway, France and Denmark agreed to deliver 100GW of offshore wind power through joint projects. The "Hamburg Declaration” will include new offshore wind farms that are directly connected to more than one country through interconnectors. (BBC) (Politico)

Policy

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Dana Nessel, Attorney General for the US state of Michigan, filed a federal antitrust lawsuit alleging oil majors BP, Chevron, Exxon Mobil, Shell and lobby group the American Petroleum Institute acted as a cartel to forestall renewable energy competition, causing Michigan residents “to suffer artificially high home and transportation energy costs”.

Regulation

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Retailers overcharging Centrepay customers were the primary focus of the Australian Energy Regulator’s compliance and enforcement actions in the six months to December 2025. The regulator enforced more than $1.3 million in court ordered and infringement notice penalties, the majority ($1.089m) from Alinta Energy. The AER is awaiting a decision from the Federal Court after AGL appealed against the Court’s findings that they pay $25 million for failing to comply with their overcharging obligations under the Retail Rules related to Centrepay payments.

People

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Geologist and academic Professor Peter Cook was appointed a Companion of the Order of Australia (AC), Australia’s highest honour, for eminent service to science as an innovator, pioneer and international expert in the development of carbon capture and storage, to policy development, and to climate change mitigation. Cook instituted and was chief executive of the Cooperative Research Centre for Greenhouse Gas Technologies until 2011, and he was also Coordinating Lead Author for the IPCC's work on CO2 capture and storage.

Sue McCarrey was reappointed as Chief Executive Officer of the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) for a further three years.

Random

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US Interior Secretary Doug Burgum invited Americans to learn more about President Trump’s energy agenda from their “new spokesperson” Coalie — a cartoon lump of coal. (Politico)

What's On

January 29​
​The Politics of the Impossible: Will Australia prioritise its economy and make polluters pay?

Professor Rod Sims and Superpower Institute Carbon Pricing and Policy Lead Ingrid Burfurd will speak at this webinar on the economic and political context behind The Superpower Institute’s latest report The Case for Pricing Pollution.

February 8-11​
World Renewable Energy Congress

Zenith Energy Executive ESG & Stakeholder Engagement Dominic Da Cruz, Pollination Managing Director Rob Grant, Western Australian Program Director for The Superpower Institute Jessica Shaw and European Renewable Energies Federation Vice-President Rainer Hinrichs-Rahlwes will speak at this Perth event also featuring researchers from around the world.

February 11​
​AEMO Quarterly Energy Dynamics

AEMO Manager - Market Dynamics Kerry Galloway will speak at this webinar on the outcomes of the last quarter of 2025.

February 11​
​Delivering on the Queensland Energy Roadmap

CS Energy CEO Brian Gillespie will deliver the keynote at this Queensland Energy Club event in Brisbane.

February 24​
​Energy Security NSW

AEMC Commissioner & Reliability Panel Chair Rainer Korte will keynote this CEDA event in Sydney also featuring ASL CEO Nevenka Codevelle, Neoen Australia Head of Development Nathan Ling, Transgrid EGM of Network Jason Krstanoski and Australian Gas InfrastructureGroup EGM Customer & Strategy Cathryn McArthur.

Level 1, 60 Martin Place, Sydney, NSW 2000
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