Australia Carbon Credit Market 2026 | Worth 33.3 Million ACCUs by 2034

Market Overview

The Australia carbon credit market size reached 19.5 Million ACCUs in 2025 and is projected to reach 33.3 Million ACCUs by 2034, exhibiting a CAGR of 5.93% during the forecast period 2026-2034. The industry is expanding significantly due to favorable government policies and regulations, increased dedication to corporate social responsibility, expanded international trade prospects, and significant expansion in renewable energy projects.

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How AI is Reshaping the Future of the Australia Carbon Credit Market:

• AI-powered carbon accounting platforms are enabling more precise measurement, reporting, and verification (MRV) of emissions reductions, increasing the integrity and traceability of Australian Carbon Credit Units (ACCUs).

• Machine learning tools are being deployed to analyze satellite and remote sensing data, improving the monitoring of land-based carbon sequestration projects such as reforestation and savanna fire management.

• AI-driven analytics are helping corporations identify optimal carbon offset strategies aligned with their ESG frameworks, accelerating voluntary market participation.

• Blockchain and AI-integrated registries, such as the Unit & Certificate Register being developed with Trovio Group, are boosting transparency and reducing the risk of double-counting in credit transactions.

• Predictive modelling powered by AI is supporting project developers in assessing the long-term carbon yield of sequestration and avoidance projects, improving investment decision-making.

• AI-enabled carbon credit exchanges are improving market liquidity and price discovery, drawing greater financial sector participation and institutional investment into the market.

Market Growth Factors

Government policies and regulations are the primary foundation of the Australia carbon credit market. The Emissions Reduction Fund (ERF) provides financial incentives for businesses, landowners, and communities to adopt emissions-reducing practices, enabling them to generate tradeable ACCUs. The Safeguard Mechanism complements this by setting baseline emissions limits for large industrial facilities - when companies exceed their limit, they must purchase ACCUs to offset the excess, directly creating sustained market demand. Together, these frameworks foster a regulated environment that encourages innovation and investment in technologies such as carbon capture and storage and renewable energy.

Corporate sustainability goals are driving significant voluntary market participation. Businesses across mining, energy, manufacturing, and agriculture are increasingly adopting net-zero pledges and ESG commitments, turning to carbon credits as an effective mechanism to offset emissions that cannot be eliminated through operational changes alone. Growing pressure from investors, consumers, and regulatory bodies is amplifying this trend, while the rise of mandatory sustainability reporting is compelling companies to take credible, measurable steps - adding further depth to market demand.

International trade opportunities and financial sector engagement are providing additional structural growth drivers. Australia's ACCUs are recognized globally, opening export revenue streams as demand rises in carbon-vigilant markets across Asia and Europe. As carbon border adjustment mechanisms gain traction internationally, Australian exporters in sectors like mining and agriculture are increasingly required to demonstrate low-carbon credentials to remain competitive. Simultaneously, banks, superannuation funds, and investment firms are treating carbon credits as a legitimate asset class, channeling capital into carbon farming projects and driving improvements in market transparency, liquidity, and long-term stability.

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Market Segmentation

Type Insights:

• Compliance

• Voluntary

Project Type Insights:

• Avoidance/Reduction Projects

• Removal/Sequestration Projects

o Nature-based

o Technology-based

End-Use Insights:

• Power

• Energy

• Aviation

• Transportation

• Buildings

• Industrial

• Others

Regional Insights:

• Australia Capital Territory & New South Wales

• Victoria & Tasmania

• Queensland

• Northern Territory & Southern Australia

• Western Australia

Recent Developments & News

• November 2025: Santos achieved a record carbon credit allocation at its Moomba CCS project, receiving 614,133 Australian Carbon Credit Units (ACCUs) from the Clean Energy Regulator for emissions reductions between September 2024 and March 2025 - the largest award of credit units to date, underscoring scaling carbon removal efforts in Australia's hard-to-abate energy sector.

• September 2025: Data from the Clean Energy Regulator's quarterly report showed that ACCU issuances in the first half of 2025 reached 9.5 million units, keeping total issuance on track for a projected 19-24 million ACCUs by year-end - signaling strong market activity and participation in carbon offset projects.

• April 2025: Analysis of the reformed Safeguard Mechanism revealed that demand for Australian Carbon Credit Units (ACCUs) increased nearly six-fold during the first compliance year, with issuances almost matching industry demand - reflecting intensifying compliance pressure and a tightening regulatory environment.

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IMARC Group is a global management consulting firm that helps the world's most ambitious changemakers to create a lasting impact. The company provides a comprehensive suite of market entry and expansion services. IMARC offerings include thorough market assessment, feasibility studies, company incorporation assistance, factory setup support, regulatory approvals and licensing navigation, branding, marketing and sales strategies, competitive landscape and benchmarking analyses, pricing and cost research, and procurement research.

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