The Federal Government’s Direct Action Policy is up and running. Its centrepiece, the Emissions Reduction Fund, is a $2.55 billion dollar fund set up to “support Australian businesses and households to take practical, direct action to reduce emissions and improve the environment.”

 

The objective of the fund is to help achieve Australia’s emissions reduction target of 5 per cent below 2000 levels by 2020, by supporting business to become more productive and more energy efficient.

 

A range of methods exist to reduce the carbon footprint of an organisation, from the replacement of outdated machinery to the inclusion of renewables in the energy mix. Our team has assisted the Government by advising on policy framework and by helping develop methodologies for measuring and calculating emissions abatement that may be implemented by businesses, and is now helping businesses to participate in the scheme.

 

The first reverse auction for the funding of emissions reduction projects was held in April this year, and the average price paid by the Government was $13.95 per tonne of abatement.

 

Methodologies have been developed for energy efficiency projects that were not available under the Carbon Farming Initiative. Implementation of energy efficiency projects under the Emissions Reduction Fund can provide an additional short term financial benefit while providing longer term energy cost savings.