Generic Hero BannerGeneric Hero Banner
Latest Market News

Australia to develop new afforestation ACCU method

  • Spanish Market: Emissions
  • 20/05/26

The Australian government has prioritised the development of a new reforestation and afforestation carbon-crediting method that might include pongamia trees, which could lead to harvesting of oil seed to be used in biofuel production.

Australian wood-fibre processor and exporter Midway will lead a consortium of organisations to assist with the remake of the Reforestation and Afforestation 2.0 method, which expired on 30 September 2025, assistant minister for climate change and energy Josh Wilson announced today at industry member organisation Carbon Market Institute's (CMI) Carbon Farming Forum in Fremantle, Western Australia.

The consortium will be tasked with examining the inclusion of pongamia trees, Wilson told delegates. This could include the harvesting of timber and oil seeds that can be used as a feedstock for biofuel, he noted.

Potentially adding oil seed harvesting to the remake of the method was first disclosed in June last year, ahead of a public consultation carried out by Australia's Emission Reduction Assurance Committee (Erac).

Midway has been working with UK-Australian mining company Rio Tinto since 2024 on a pilot study to explore the potential of pongamia seed oil as a feedstock for renewable diesel output in northern Queensland.

Rio Tinto proposed the creation of the Sequestration of Carbon from Oil Seed Trees method under Australia's proponent-led development process launched in 2024, but Erac prioritised four other proposals at the time.

The mining firm last year announced it had secured approval for an environmental planting project linked with its pongamia biofuels pilot. It said then it continued to engage with the Department of Climate Change, Energy, the Environment and Water on the creation of a new ACCU method.

The remake of the reforestation and afforestation method will be the third to progress under the proponent-led process, following announcements earlier this year about new alternative waste treatment and beef cattle herd management methods.

The ACCU market has been oversupplied but is expected to go through a shift in the supply-demand balance within the next few years due to increasing demand from the reformed safeguard mechanism and slow method development.

Argus assessed generic ACCU prices at A$37.50/t ($26.66/t) of CO2 equivalent on 20 May, up by A$0.10/t CO2e on the day.


Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more