Australian CPRS Domestic Offsets Program

In November 2009, the Australian Government announced modifications to the proposed Carbon Pollution Reduction Scheme (CPRS) to create a domestic offsets program (Program) (see our Legal Update 24 November 2009). These modifications were put forward as proposed amendments to the pre-existing CPRS bills. Under the Program, eligible domestic offset projects will generate free Australian emissions units (AEUs) that can be used by liable entities to offset their liabilities under the CPRS.

In order to generate free AEUs, a project will need to be declared by the Australian Climate Change Regulatory Authority (Authority) to be an eligible domestic offsets project.

To be eligible, a domestic offsets project will need to be covered by and comply with a domestic offsets project methodology determination. Only projects carried out in Australia will be eligible and it is intended that the Program will not take effect (and that no applications in relation to the Program can