Q2 2025 brought the ACCU market into sharper focus with new activity influencing a forecast that now shows demand peaking sooner than expected and a wider range of price outcomes.
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Q2 2025 brought the ACCU market into sharper focus with new activity – including higher issuances, a surge in voluntary retirements and continued Safeguard holdings - influencing a forecast that now shows demand peaking sooner than expected and a wider range of price outcomes.
These shifts, and their implications, are captured in CORE Markets’ latest quarterly ACCU forecast – a central component of our Carbon Intelligence Package. Updated quarterly, the forecast incorporates fresh data from our carbon analytics platform, registry activity, and inputs from industry experts to provide a scenario-tested outlook for ACCU supply, demand and pricing through to 2040.
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Together, these signals demonstrate how shifting ACCU supply, demand and price dynamics, intersect with both compliance and voluntary activity.
The CORE Markets’ Carbon Intelligence Package brings this complexity into view - combining method-specific price forecasting, real-time data, analytical tools, and in-market expertise in one subscription.
The Q2 model contemplates key fundamental updates to supply and demand to sharpen the forecasted outlook from FY27 – FY40. Key updates include new data from the Clean Energy Regulator (CER), updated assumptions on physical abatement, latest supply-side insights including unit surrenders and holdings and fresh ACCU forward curve data.
Inclusion of these changes in our model has resulted in the forecasted peak ACCU demand occurring earlier in the forecast horizon than previously estimated. The forecast also shows a wider price range, reflecting the interaction of projected demand timing, buyer preferences and supply responsiveness.
Furthermore, the Q2 ACCU forecast highlights the sensitivity of long-term supply/demand balances to assumptions about physical abatement. These sensitivities flow through to forecasted ACCU prices.
Q2 delivered several notable developments in market activity. ACCU issuances in Q2 more than doubled Q1 levels, with Human Induced Regeneration (HIR) and Landfill Gas projects contributing the majority. This surge coincided with total ACCU holdings climbing to 51.7 million, the highest on record.
Safeguard entities consolidated their role as the dominant buyers and accounted for 56% of holdings by the end of the quarter. This reflects compliance strategies of accumulating units in anticipation of increasing obligations under the Safeguard Mechanism.
Voluntary retirement reached its highest level to date in Q2 – increasing by 161% compared to Q1. While overall retirements softened from last quarter’s compliance-driven highs, the voluntary surge indicates growing engagement from corporates with net zero and Scope 3 commitments.
Finally, deliveries into the Cost Containment Measure fell to their lowest since the mechanism’s establishment. This indicates price sensitivity from holders of Carbon Abatement Contracts (CACs) and is also reflected in increased project proponent holdings.
Together, these signals paint a picture of an ACCU market where activity is intensifying, but motivations diverge between compliance-driven positioning and voluntary procurement.
While the modelling framework remained consistent, Q2 inputs adjusted the trajectory for demand, supply, and pricing.
Safeguard entities remain the dominant demand source, followed by voluntary demand, with smaller contributions from state and territory programs.
In our Q2 model, we revisited assumptions on the uptake of additional physical abatement among Safeguard entities, drawing on Safeguard Mechanism Credits (SMC) issuances, indications of decarbonisation trends, and market price signals.
These refinements have shifted projected ACCU demand throughout FY27 - FY40 and adjusted the timing of expected peak ACCU requirements.
Key impacts include:
For more data and market commentary, explore our Carbon Intelligence Package, a digital subscription for deep market insights, cutting edge financial and physical data, advanced analytical tools and access to market experts.
The latest modelling reinforced the strength of existing supply sources while highlighting the uncertainty in future supply, both from a methodology and issuances standpoint.
ACCUs from current holdings and supply are expected to meet demand in the near term, but the composition and responsiveness of new supply are becoming increasingly important for the market balance beyond FY32.
Our forecast differentiates between existing projects, recently registered projects, and those still to be developed - highlighting where supply risks may emerge.
Key model findings include:
For more data and market commentary, explore our Carbon Intelligence Package, a digital subscription for deep market insights, cutting edge financial and physical data, advanced analytical tools and access to market experts.
The weighted average ACCU price range has widened compared with Q1, with the high-end outlook also moving higher. This reflects both earlier-than-expected demand pressures and uncertainties surrounding the responsiveness of future supply.
CORE Markets’ price outlook is built using method-level data and observed market signals, accounting for:
The result is a scenario-tested forecast that captures the differentiated, complex reality of Australia’s carbon market.
The latest CORE Markets ACCU forecast highlights that the ACCU market cannot be understood through a single headline price. Demand timing, method-level spreads, and supply responsiveness all matter for procurement and investment strategy.
The Q2 2025 ACCU Forecast is part of CORE Markets’ Carbon Intelligence Package – a digital subscription that integrates the quarterly forecast with live market prices, analytical tools and deep market insight. It is designed to help participants make informed decisions and align procurement, investment and compliance strategies in a changing market.
Signals and shifts: What Q2 2025 reveals about Australia’s ACCU market
