Emissions trading is a market-based mechanism for reducing or offsetting carbon emissions. The Australian Government enacted a carbon pricing mechanism (CPM) from 1 July 2012. The Carbon Pricing Mechanism is currently undergoing a legislative repeal process to be replaced by an Emissions Reduction Fund.
ASX is well placed to provide forward price discovery through the listing of futures contracts to support secondary markets in carbon products. ASX can provide a robust mechanism for companies that have an interest in or exposure to a price on carbon to manage their forward price and counterparty credit exposures. ASX is engaged with industry participants and following carbon policy developments closely.