Part 1: Revenue Measures (Continued)
Industry, Innovation, Climate Change, Science, Research and Tertiary Education
Carbon unit auction schedule
|Clean Energy Regulator||‑||‑||‑||‑||‑|
Following consultation with industry, the Government has set a carbon unit auction schedule of eight auctions per vintage and advance auctioning of three‑eighths of each vintage. The first auction of carbon units for the 2015‑16 fiscal year, which is the first year of the floating price period, will take place in the first half of the 2014 calendar year. This measure is estimated to have no revenue impact over the forward estimates period. In underlying cash terms, the estimated increase in receipts is $340.0 million over the forward estimates period.
The auction schedule determines how many carbon permit auctions are held in each fiscal year and what proportion of permits can be sold at advance auctions prior to their vintage year. Advance auctioning will enable businesses to more readily manage their carbon liabilities over time.
Kyoto Protocol — adoption of second commitment period and new greenhouse gas global warming potentials
|Clean Energy Regulator||‑||‑||‑||100.0||140.0|
The Government has signed up to a second commitment period under the Kyoto Protocol, with effect from 1 January 2013. A necessary precondition of joining the second commitment period under the Kyoto Protocol is the adoption of the United Nations Fourth Assessment Report Global Warming Potentials. These will be used to determine liabilities under the carbon pricing mechanism from 2017‑18. This measure is estimated to have a gain to revenue of $240.0 million over the forward estimates period due to associated changes in the assumed scheme cap in 2015‑16 and 2016‑17.
Joining the second commitment period has allowed the Government to reaffirm its international target of reducing net emissions by at least five per cent below 2000 levels by 2020 and ensure that Australian businesses have access to international credits under the Clean Development Mechanism.
Further information can be found in the joint press release of 9 December 2012 issued by the Minister for Climate Change and Energy Efficiency and the Parliamentary Secretary for Climate Change and Energy Efficiency.
Kyoto Protocol — election of additional land‑based activities under the second commitment period and termination of the Non‑Kyoto Carbon Fund
|Clean Energy Regulator||‑||‑||‑||70.0||100.0|
|Related expense ($m)|
|Clean Energy Regulator||‑||3.2||12.3||‑||‑|
|Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education||‑||‑49.6||‑46.7||‑60.7||‑77.7|
|Total — Expense||‑||‑46.4||‑34.4||‑60.7||‑77.7|
|Related capital ($m)|
|Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education||‑0.2||‑||‑||‑||‑|
The Government will count abatement from cropland management, grazing land management and revegetation towards Australia's commitments under the Kyoto Protocol from 1 July 2013. As a result, the Government will issue a greater number of permits to entities liable under the carbon pricing mechanism.
The changes outlined above will allow landholders to generate revenue under the Carbon Farming Initiative from the sale of carbon credits to liable entities. As a result, there is no need to proceed with the Non‑Kyoto Carbon Fund, which was scheduled to commence on 1 July 2013.
This measure is estimated to provide savings to the Budget of $389.4 million over the forward estimates period.
Renewable Energy Target — conclusion of the solar credits mechanism
|Clean Energy Regulator||‑1.4||‑0.4||‑||‑||‑|
The Government concluded the scheduled phase‑out of the Solar Credits mechanism under the Renewable Energy Target on 1 January 2013, six months earlier than originally scheduled.
This measure has resulted in the Government receiving less revenue from fees for the creation and surrender of Renewable Energy Certificates and from the Renewable Energy Shortfall Charge. The reduction in revenue is estimated to be $1.8 million over two years from 2012‑13.
Further information can be found in the press release of 16 November 2012 issued by the then Minister for Climate Change and Energy Efficiency.
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