- New daily benchmark: Platts will assess spot market prices for Australian SMCs starting May 5, offering greater transparency in carbon trading.
- Boost to market confidence: The assessment aims to support emissions trading, compliance, and investment decisions across Australia’s decarbonization sectors.
- Regulator-linked data: Prices will reflect issuances from the Clean Energy Regulator, with timestamps aligned to major Australian cities.
Platts, a division of S&P Global Commodity Insights, will launch a daily market assessment for Australian Safeguard Mechanism Credits (SMCs) on May 5, 2025.
This new benchmark is designed to improve price transparency and boost confidence in Australia’s carbon trading market.
“By providing a transparent, independent price assessment, Platts aims to support market participants in trading, compliance, and investment decision-making.“
SMCs are distinct from traditional carbon offsets.
They are internal trading instruments under the Safeguard Mechanism, which requires major industrial facilities to stay within set emissions baselines. Facilities that reduce emissions below their threshold earn SMCs, which can be sold or surrendered for compliance.
RELATED ARTICLE: TD Launches ETF Focused on Global Carbon Credit Market
Each SMC represents one metric tonne of CO₂ equivalent (mtCO₂e) reduced or avoided below a facility’s baseline.
“The system allows lower-cost emitters to sell their excess reductions to those facing higher abatement costs, improving overall efficiency in emissions management.“
Platts’ new benchmark will:
- Cover spot market transactions of 5,000 to 100,000 mtCO₂e
- Be reported in Australian dollars per mtCO₂e
- Be timestamped at 16:30 local time in Melbourne, Sydney, and Canberra
- Be published according to the APAC Carbon Calendar
- Include both daily pricing and a monthly average
“SMCs are a unique form of emissions reduction credit under Australia’s Safeguard Mechanism.”
This marks a pivotal step in the evolution of Australia’s emissions reduction framework, helping industry players navigate compliance and investment strategies as the country progresses toward net-zero targets.
Follow ESG News on LinkedIn
The post S&P’s Platts to Launch Daily Benchmark for Australia’s SMC Carbon Credit Market appeared first on ESG News.
