Emissions trading auctions on eBay next year?
Will Australian businesses be allowed to sell their carbon pollution permits on eBay? And will they be able pay by credit-card?
These are just two of the numerous intriguing questions about the Australian government’s proposed emissions trading system due to begin next year.
Both questions became suddenly more important last month when the Australian government Department of Climate Change advertised for designers of an online auction system for carbon pollution permits.
Initially a call for expressions of interest, the advertisements give a closing date of the 15th April. It includes not only the auction system, but also the associated payments or settlements system.
With potentially up to a thousand of Australia's largest companies affected, and the system also likely to form part of an overall emissions trading scheme, there seems little doubt that many of Australia’s major IT, ecommerce and consulting companies will be responding to the advertisement.
Summary details of the advertisement can be accessed at the government’s AusTenders web-site.
“The Department of Climate Change seeks to procure externally sourced managed services from the open market for the development and operation of an
auction system, settlement system and associated services for Australia’s Carbon Pollution Reduction Scheme (CPRS).”
Of course as the legislation to pass the scheme into law hasn’t yet been voted on by the Australian parliament, the CPRS is still just a proposal.
It already has many opponents and, particularly because of the deepening global recession, is no certainty to begin next year as the government plans.
Even so, there seems little doubt that there will be some sort of permit system introduced in the very near future.
And that’s not just most Australians now share not only a deep concern over climate change; they also believe something has to be done, and the sooner the better.
Moreover Australians are not alone in that and many other countries, particularly in Europe have already set up emissions trading schemes.
So it’s a reasonable bet that the governments trading scheme will start next year, and that part of the scheme will be an online auction system.
The details of how that system, will work are, of course, still to be decided.
But the government has already indicated it’ll be an ascending clock type of auction.
This means that the auctioneer will keep raising the price until the number of permits sought by bidders matches the number for sale.
Just what that means in practice is a little hard to understand.
Which is where consulting firm KPMG, in partnership with MacQuarie Bank, has made a smart move, by offering businesses an opportunity to participate in a simulated online permit auction.
Jennifer Westacott is KPMG’s senior partner in charge of the consulting firms ’Sustainability, Climate Change & Water’ practice.
She told eCommerce Report that the simulation would be suitable for businesses whose emissions are in the range of 25kt CO2-e/annum (at a facility level) and above.
It will be conducted over a 5-month period in 2009, starting at the end of May, and designed to reflect the proposed auction process as closely as possible to enable participants to engage in a realistic simulation.
"It’ll be an invaluable ‘learn by doing’ opportunity for those participating", she said, adding that "it will enable organisations to ‘road test’ their readiness to effectively buy and sell
carbon pollution permits prior to the introduction of the CPRS in 2010."
She said the simulation would help businesses to answer key questions including:
- How many permits need to be purchased?
- At what price point is it cheaper to reduce emissions?
- What systems, processes and/or controls will a business need to manage and report their emissions?
- And what will a business need to know and to have to be ready to successfully participate in the government’s auctions of carbon pollution permits?
For more information on the Australian governments Carbon Pollution Reduction Scheme, go to
www.climatechange.gov.au
For more information on the Department of Climate Change permit auction system tender go to
https://www.tenders.gov.au/?event=public.atm.show&ATMUUID=17BCA9BC-C279-CCC0-79670CE51CAB9EA2
For more information on the KPMG simulation go to
www.kpmg.com.au/Portals/0/KPMG-CarbonTradingAuctionSimulationEoI-2009.pdf
For an independent overview of the Australian government’s Scheme and its plans go to
www.fma.com.au/cms/files/Anny_Joseph_Presentation.pdf
To buy carbon offsets on eBay go to
http://lotsmore.shop.ebay.com.au/items/Carbon-Offsets-Credits__W0QQ_sacatZ158376?_npmv=3
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