The latest summary edition of our monthly Australian energy & environmental market update is now available. Keep reading for energy and carbon pricing movements, policy updates and other news.
This month we cover energy and environmental market movements, the Queensland government proposing stricter approval processes for wind projects, and the Green Aluminium Production Credit announced by the Albanese Labor government.
Keep reading for an overview of key market developments and a discussion of the impact of these announcements.
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For a comprehensive update on the ACCU market, read our ACCU Monthly Market Report here
The Queensland government has proposed stricter approval processes for wind projects, mandating community consultation to align renewable energy development with broader land-use policies.
In mid-January, the Queensland government issued a “call-in” notice on the state development approval for the Moonlight Range Wind Farm, initiating fresh consultation on whether the project aligns with state interests. Additionally, development applications for three other wind projects—Fortescue’s Wongalee, Windlab’s Bungapan, and RWE’s Theodore wind farms—were paused.
This decision triggers a 40-day consultation period, allowing community members, local governments, and other stakeholders to submit their feedback.
According to the draft framework released in September 2024, the updated legislation aims to ensure that renewable energy projects undergo impact assessments aligned with approval processes for other land uses, such as mining. The framework outlines five key initiatives:
Deputy Premier and Minister for State Development, Infrastructure, and Planning, Jarrod Bleijie, announced that from Monday, February 3, all wind farm developers will be required to consult with local councils, communities, and other stakeholders before proceeding with new projects.
The government also stated that large-scale solar farms and other renewable energy developments will be subject to similar assessments, mandating community consultation and granting third-party appeal rights.
The Green Aluminium Production Credit was announced by the Albanese Labor government on the 20th Jan 2025, injecting $2 Billion investment into the industry to incentivize the production of green aluminium.
On the 20th Jan 2025, The Albanese Labor Government announced a $2 Billion investment into the Aluminium industry as part of its Future Made in Australian economic plan.1
This injection of funds aims to supercharge the local metals industry and provide incentives to produce green aluminium, securing the future of the aluminium industry in Australia.
The funding will be made available to aluminium smelters from 2028-2029.
How will the program work?
Aluminium smelters that can show decarbonisation efforts before 2036 will be able to negotiate an emissions-linked credit contract with the government per tonne of green aluminium produced for up to 10 years.2
Crediting rates will be based on individual facilities and negotiations.
How will this affect the energy market?
Aluminium smelters are responsible for ~10% of Australia’s energy demand3 and that ~80% of emissions from Australian aluminium smelters are associated with their electrical use4
Therefore, for aluminium smelters to utilise this scheme, there will likely be a further push to procure renewables on a large scale across QLD, VIC and NSW.
1Minister for Industry and Science, Joint media release: Aluminium to forge Australia's manufacturing future
2Department of Industry, Science and Resources, New Green Aluminium Production Credit will support the transition to green metals
3IEEFA, Why Aluminium smelters are a critical component in Australian decarbonisation
4DCCEEW, Australian Emissions Projections 2023
Energy market
Electricity prices moderated downwards across all mainland regions of the NEM this month, stabilising after the heightened volatility in November and December last year. Despite prices relaxing overall, multiple forecasted lack of reserve (LOR) events occurred amid record-high demand in QLD. High demand is typical for the start of the year due to high temperatures potentially tightening the demand-supply balance.
The CORE Markets team partners with renewable energy developers and corporate buyers to support strategic planning and effective risk management. Reach out to discuss how we can help optimise your strategy in this evolving market.
Carbon market
The carbon market saw high traded volumes this month compared to December, and a softening of prices in the ACCUs market. ACCU prices have now normalised to pre-November 2024 levels.
We’ve written about the eventful year that was in the ACCU market, and 2025 is shaping up to be another big year. Keep up-to-date with important developments as they happen in the CORE Markets analytics platform. This includes ACCU market data across major methodologies (including forward price curves), policy and regulatory updates, and daily insights from our markets team. Book a demo today.
The events outlined in this month's update highlight the evolving nature of carbon, environmental and energy markets and the complexity of the net zero transition.
To discuss your unique requirements, get in touch with our team today to see how we can help.
Australian Energy & Environmental Market Update - January 2025
