THE Carbon Market Institute (CMI) says that COP26 has created opportunities for Australia however the Hunter will need to adapt and change as the use of fossil fuels is increasingly coming under the international microscope.

While the agreement is seeking a phasing out of coal there are other opportunities for the Hunters energy businesses to enter and potentially dominate.

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According to CMI Australia risks losing its advantages in carbon crediting and clean technologies without stronger policies to deploy, not just develop, technological solutions.

Following the most influential COP since the introduction of the Paris Agreement in 2015, the spotlight has shifted to the federal government and business to seize new opportunities and unlock the barriers to a sustainable and ‘just’ transition.

CMI CEO John Connor stated, “Australia now has a once-in-a-generation opportunity to build on its well-established and globally regarded carbon crediting mechanism, and its proposed Indo-Pacific Carbon Offsetting Scheme, to set high standards in the new post-Glasgow global carbon markets.

“Both of these Australian and regional emissions trading and carbon pricing schemes need to deliver integrity in the credits and in the ambition of the emission reduction trajectory they support.

“Carbon markets must be means to end that means helping achieve the Paris temperature goals.

“Australia has abundant opportunities in clean energy, technology and natural climate solutions and a decade of considerable experience and achievement in monitoring, reporting and verification.

“This expertise and experience alone is an important potential export, but policies are required that drive investment in the deployment, not just the development of technology.”

Under Article 6 agreements in particular, COP26 has delivered a platform for greater international cooperation and established a governance framework for international emissions trading.

“This now needs to be aligned with booming voluntary global and Australian carbon markets to ensure verified emission reductions and other social and environmental benefits are achieved in industrial decarbonisation and natural climate solutions.

“There is an urgent need to mobilise these markets to ensure we maximise climate action this decade.

“Unfortunately, progress will be limited until there are updated policy frameworks to support this ambition, including reforms to Australia’s Safeguard Mechanism.

“This is a generational opportunity that can’t be missed.”

The CMI believes that post COP26 Australia and others will be under greater scrutiny at COP27 and COP28 and whether its phase down or phase out, the global focus shifts to managing the transition from fossil fuels and the need to do this in a “just” inclusive way.

Furthermore new rules for international cooperation and carbon markets provide a platform for high integrity, transparency and comparability, but corporate and national vigilance on integrity and emission reduction will be vital and that there is greater emphasis on the importance of protecting, conserving and restoring nature in achieving net-zero emissions, including forests and other terrestrial and marine ecosystems.

CMI stated that Australia is well positioned to become a global leader in nature-based solutions development, knowledge brokering, finance and capacity building but needs to nurture its crediting mechanism integrity frameworks and have a more credible emissions reduction trajectory and failure to deliver on public and private climate finance pledges remains a stumbling block with commitments to double adaptation funding and a “dialogue” on Loss and Damage barely keeping developing countries at the table; with this issue likely to be central to COP27 and future progress.

By Marian SAMPSON