Market Update March 2022

Below is a lite version of our monthly energy & carbon market update.

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  • Renewable Energy Hub structured an innovative renewable energy PPA for IFM Investors and QIC in a deal to power Australia’s critical infrastructure and lower greenhouse gas emissions.
  • The Federal Government announced ERF projects with fixed delivery government contracts will be able to exit those agreements by paying out the contract value based on the pre-agreed price. Australian Carbon Credit Units (ACCUs) pricing fell by 25% to $35.40 upon this news but remain well over two-times the price of the majority of ERF struck contracts.
  • Origin Energy announced it has submitted notice to close the nation’s largest coal fired generator Eraring (2880 MW) by August 2025.
  • The month of February saw rises in electricity spot prices for New South Wales and Tasmania, with falls in the rest of the NEM. Demand was lower compared to January with similar levels of volatility.
  • 2023 Flat Futures prices trended upwards, ending the month at or near annual highs.
  • Gas prices were flat across the East Coast, while the Japan-Korea netback price fell over 25% to $30/GJ, however futures indicate values of over $35/GJ until April 2023.
  • ACCU prices fell below $50/certificate in February, with a 25% fall to $35.40 on March 4th.
  • LGC prices rose for all vintages, with pronounced rises in Cal 24, Cal 25, and Cal 26 LGCs.
  • STCs rose slightly to $39.55/certificate.

 

  • ACCU prices trended downwards during February.

  • Continued strong corporate demand and inflationary fears saw LGC prices rise for all vintages over February.

Feature 1: Renewable Energy Hub assists IFM & QIC PPA

Renewable Energy Hub structured and implemented a first of its kind multi-asset, multi-state renewable energy power purchase agreement (PPA) which will help decarbonise critical infrastructure such as airports, ports, roads and hospitals.

The full media release can be found here.

Feature 2: Government announces Emissions Reduction Fund (ERF) changes

On March 4th, the Federal Government announced ERF projects with fixed delivery government contracts will be able to sell their Australian Carbon Credit Units (ACCUs) on the private market.

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