ACCU Market Monthly Report - September 2024

ACCU market overview for September 2024

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ACCU market highlights

• September saw the highest ACCU trade volumes of the year with activity in the spot and forward market topping 2.5m for month, further boosted by solid increase in ACCU options market activity.
• The ACCU spot price continued its upward journey on the back of sustained engagement from Safeguard participants who, for the second month running, brought strong demand to market.
• Carbon Abatement Contract (CAC) exits for the current 18-month long window increased across the month, reaching 1.9m in the most recent figures published by the Clean Energy Regulator (CER), a slower rate of emergence from those contracts than many expected. The CER's Quarterly Carbon Market Report released in September also saw a widening of its forecast range for CAC exits during the window from 9-12m to 7-13m.
• In the spot market, the volatility of late-August carried into September, as prices collected momentum early to reach a monthly high of $37.40 for both Generic and Human Induced Regeneration (HIR) spot ACCUs in the middle of the month.
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Learn more about our ACCU Market Forecast Report, a method-specific ACCU market supply, demand and price forecast

ACCU method-specific price movements and volumes traded

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ACCU price

• The Generic spot ACCUs opened September at $34.90, down $0.35 on August's closing price. The market then gradually improved, levelling at $35.50 from the 5th to the 9th, before consistent gains took the price to its monthly high of $37.40 on the 18th. An initial gradual decline then gathered momentum, with the spot softening to a low of $36.00 on the 24th. The final week of September saw the volatility continue, with prices climbing once again to $37.00 on the 26th, while the month ultimately closed back down at $36.25, $1.00 (2.84%) above August's closing price.
• The HIR spot market opened with a $0.35 premium on Generic spots with a trade at $35.40, level with August's close. Prices climbed steadily to the 10th, moving broadly in-tandem with the Generic market on its way to a peak of $37.40 on the 17th, up $1.80 on the highest traded price from the previous month. With lower trade volumes than Generic spots, HIR spot volatility was lower for much of the month, yet following a dip to $36.10 on the 24th, the spot HIRs climbed to close September at $37.00, up 4.4% month on month.
• The spot HIR/Generic premium fluctuated over September, though one trend was clear. As prices increased across the month, the differential reduced, with buyers seemingly less willing to pay a premium on top of higher Generic prices.
• Various premium ACCU methodologies traded in September in similar levels to previous months. An Environmental Plantings parcel at $47.75 in 10k and an Animal Effluent parcel at $36.75 in 32k traded mid-month, alongside a 10k parcel of Savanna Fire Management ACCUs at $36.90 later in September.

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ACCU volumes traded

• Trading volumes were stronger across September, with the combination of spot (2.04m) and forwards (507k) bringing the total activity to 2.55m, the highest monthly trade volume of 2024 year to date.
• The highest ever daily volume of Generic spot ACCU trades took place early in the month, with some 531k units exchanged on September 12th. This eclipsed the previous record-holder, dating back to March 2024, by some 21k units. Also on the day, total HIR spot ACCUs traded was a shade under 100k, with strong HIR volumes also seen on the 3rd (85k) and the 17th (80k) of September.
• As in August, the forward curve softened over September to regularly see carry rates between 4.25% and 4.50%.
• Volumes were further boosted by an increase in options trade activity across the month as participants sought to obtain some protection against future price movements.

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Learn more about our ACCU Market Forecast Report, a method-specific ACCU market supply, demand and price forecast

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ACCU supply, issuance & project registration

• The ACCU market saw a substantial increase in issuances on recent months, with the Clean Energy Regulator (CER) issuing an aggregated 3.2 million ACCUs across issuance periods in September. The CER believes it will issue 20m ACCUs in 2024.
• HIR and Savanna Fire Management (SFM) issuances dominated the CER's September activity, comprising more than half of all issuances across the month. The share of HIR ACCUs went backwards slightly as a percentage of the whole, but still eclipsed August's figure by some 400k units. SFM ACCUs, a premium methodology, accounted for 801k units (the largest individual methodology by issuance) where, in August, it comprised only a few percentage points of the month's total issuance.
• ALFA (NT) Limited, an organisation created by Aboriginal landowners, received the highest share of ACCUs in September, totalling some 530k across the month, for its various Savanna Fire Management projects in the Northern Territory's Arnhem Land. TerraCarbon, a climate advisory firm, received issuance in September for various projects, including one Queensland-based HIR project which received more than 80k units. Landfill Gas and Power's Tamala Park Landfill Gas Power Station also received a substantial parcel of ACCUs, totalling approximately 100k units.

Other market developments

• On the 16th of September, the DCCEEW released a exposure draft for proposed ACCU Scheme transparency changes. The draft requires the Clean Energy Regulator to publish additional project data and information.  Proposed changes include improvements in the detail of project activities across methodologies, additional reporting on the permanence and abatement modelling of a project, a statement of identity of suppression mechanisms on a project, and more. The draft will be finalised post a public consultation process.

Stay up-to-date with the ACCU market

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