According to the terms of the carbon abatement contracts, the maximum extent of the damages payable is fixed at the agreed offset price under the contract.
“Initially, delivery milestones falling due from 4 March to 30 June 2022 will be offered an administrative option not to deliver those ACCUs to the agency on payment of an exit fee.
Several carbon market analysis have told RenewEconomy that carbon credit prices may slump as a result of the change – which have already fallen in recent weeks. But analysts indicated that ACCU prices could hit a floor of around $24 per tonne, the minimum price where it makes sense for abatement projects to walk away from their contracts.
“These changes are entirely consistent with the Coalition’s longstanding policy of supporting voluntary action to reduce emissions.