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Department of Climate Change, Energy, Enviroment and Water

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  1. Home
  2. Climate change
  3. Emissions reduction
  4. Emissions Reduction Fund

Sidebar first - EN - Climate change emissions reduction

  • Climate change
    • Emissions reduction
      • Emissions Reduction Fund
        • Methods for the Emissions Reduction Fund
          • Aggregated small energy users method
          • Alternative waste treatment method
          • Animal effluent management method
          • Aviation method
          • Avoided clearing of native regrowth method
          • Avoided deforestation 1.1 method
          • Beef cattle herd management method
          • Carbon capture and storage method
          • Coal mine waste gas method
          • Commercial and public lighting method
          • Commercial building energy efficiency method
          • Designated Verified Carbon Standard projects method
          • Domestic, commercial and industrial wastewater method
          • Estimating sequestration of carbon in soil using default values method
          • Facilities method
          • Fertiliser use efficiency in irrigated cotton method
          • High efficiency commercial appliances method
          • Human-induced regeneration of a permanent even-aged native forest 1.1 method
          • Industrial Electricity and Fuel Efficiency method
          • Industrial Equipment Upgrades method
          • Industrial and commercial emissions reduction method
          • Land and sea transport method
          • Landfill gas (generation) method
          • Landfill gas method
          • Measurement based methods for new farm forestry plantations method
          • Measurement of soil carbon sequestration in agricultural systems method
          • Native forest from managed regrowth
          • Oil and gas fugitives method
          • Plantation Forestry method
          • Reducing greenhouse gas emissions in beef cattle through feeding nitrate containing supplements method
          • Reducing greenhouse gas emissions in milking cows through feeding dietary additives method
          • Reforestation and Afforestation 2.0 method
          • Reforestation by Environmental or Mallee Plantings - FullCAM
          • Refrigeration and Ventilation Fans method
          • Refrigeration and Ventilation Fans method
          • Savanna fire management - emissions avoidance method
          • Savanna fire management - sequestration and emissions avoidance method
          • Source separated organic waste method
        • Closed Emissions Reduction Fund methods
        • Emissions Reduction Assurance Committee
        • Northern Australia fire management with the Emissions Reduction Fund
      • Independent Review of ACCUs
        • Panel members
      • Reducing agricultural and land sector emissions
      • Reducing emissions through carbon capture, use and storage
      • Regulating Australian fuel quality

Emissions Reduction Fund

Australia's carbon crediting scheme, the Emissions Reduction Fund (ERF) offers landholders, communities and businesses the opportunity to run projects in Australia that avoid the release of greenhouse gas emissions or remove and sequester carbon from the atmosphere. 

This can be through projects involving:

  • new technology
  • upgrading equipment
  • changing land or business practices to improve productivity or energy use
  • changing the way vegetation is managed to store more carbon

Eligible projects include those associated with:

  • vegetation management
  • agriculture
  • energy consumption
  • waste
  • transport
  • coal and gas production
  • industrial processes

Participants can earn Australian Carbon Credit Units (ACCUs) for every tonne of tonne of carbon dioxide equivalent (tCO2-e) emissions stored or avoided by a project. ACCUs can be sold to generate income, either to the Australian Government through a carbon abatement contract, or to companies and other private buyers in the secondary market. Government purchasing of ACCUs occurs through the Powering the Regions Fund.

The Carbon Credits (Carbon Farming Initiative) Act 2011 established the ERF in 2015.

Our department is responsible for:

  • policy development
  • the legislation
  • oversight of the ERF, including advising the Minister on making the technical rules (methods)

The Clean Energy Regulator is the Australian independent statutory authority responsible for:

  • developing carbon crediting methods under the ERF (the technical rules for carrying out a project) through a co-design process
  • administering the ERF
  • making emissions reduction purchases on behalf of the Australian Government and managing carbon abatement contracts
  • the Secretariat to the Emissions Reduction Assurance Committee (ERAC)

Eligibility

Projects must:

  • be new (not have begun to be implemented),
  • go beyond business-as-usual activities,
  • not be required by law,
  • not be receiving financial support from specified government programs, such as the New South Wales and Victorian energy efficiency schemes,
  • follow an approved carbon crediting method, which sets out the rules for running the project and estimating emissions reductions, and
  • meet the eligibility criteria and not be an excluded activity listed in Division 2 of the Carbon Credits (Carbon Farming Initiative) Rule 2015.

The person or entity responsible must have the legal right to carry out the project activities and a lawful and exclusive right to be issued all ACCUs generated by the project. All project participants must undergo a fit and proper person assessment.

Read more about eligibility requirements on the Clean Energy Regulator’s website.

Process for participating

To participate in the ERF you need to register your project via the Clean Energy Regulator Client Portal.

Typically, you will follow these steps:

  • Apply to register yourself and your project under the ERF
  • Deliver project
  • Report on your project at regular intervals (certain intervals may require an ERF audit report) and claim ACCUs for the carbon abatement achieved in each reporting period
  • Hold your ACCUs or sell your ACCUs to generate income, either to the Australia Government through a carbon abatement contract or to private buyers
  • ACCUs may be voluntarily retired (cancelled) or surrendered to meet other obligations.

Methods

Methodology determinations are the rules for estimating emissions reductions to ensure they are genuine and additional to business-as-usual operations.

The Clean Energy Regulator co-designs carbon crediting methods with industry, potential end-users, scientists and technical experts. The Emissions Reduction Assurance Committee (ERAC) releases draft methods for public consultation to ensure they are fit for purpose and assesses whether methods comply with the Offsets Integrity Standards set out in the legislation. On consideration of the ERAC's advice, the Minister decides whether to make methods as legislative instruments.

Read about how carbon crediting methods are developed

Read more

  • The ERF is enabled by the Carbon Credits (Carbon Farming Initiative) Act 2011 which also enables the 2015 Rule.
  • View all finalised methods
  • Read the 2014 Emissions Reduction Fund White paper
  • Read about Australia’s domestic actions for climate change

Connect with us

  • Subscribe to updates about the ERF
  • Read emissions reduction news

Contact us

Email emissions-reduction@industry.gov.au

See also

  • The Safeguard Mechanism provides a framework to limit emissions from Australia’s largest emitters
  • The Renewable Energy Target scheme encourages the additional generation of electricity from renewable sources
  • The National Greenhouse and Energy Reporting scheme is the single national framework for Australia’s energy and emissions reporting
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Last updated: 03 November 2022

© Department of Climate Change, Energy, the Environment and Water

We acknowledge the Traditional Owners of country throughout Australia and recognise their continuing connection to land, waters and culture. We pay our respects to their Elders past, present and emerging.