Climate Change

Carbon Tax

The Carbon Pricing Act (CPA) and its accompanying Regulations came into operation on 1 Jan 2019.

The Measurement, Reporting and Verification (MRV) requirements are specified in the Carbon Pricing (Measurement, Reporting and Verification) Regulations 2018 which can be found here.

Reporting of emissions only (Reportable Facility)

Under the Carbon Pricing Act, the responsibility rests with any industrial facility that emits direct greenhouse gas (GHG) emissions equal to or above 2,000 tCO2e annually to register as a reportable facility and to submit an Emissions Report annually.

Facilities would have to consider emissions arising from both Fuel Combustion (FC) and Industrial Processes and Product Uses (IPPU).

Reporting of emissions and payment of carbon tax (Taxable Facility)

Any industrial facility that emits direct GHG emissions equal to or above 25,000 tCO2e annually will be required to be registered as a taxable facility and to submit a Monitoring Plan and an Emissions Report annually.

Taxable facilities will also have to pay a carbon tax from 1 Jan 2019 onwards for reckonable GHG emissions. The carbon tax is set at a rate of $5 per tonne of GHG emissions (tCO2e) from 2019 to 2023. To achieve our climate ambition, the carbon tax rate will be raised to $25/tCO2e in 2024 and 2025, and $45/tCO2e in 2026 and 2027, with a view to reaching $50-80/tCO2e by 2030.

Use of International Carbon Credits

Companies may utilise high quality international carbon credits to offset up to 5% of their taxable emissions from 2024.

Transition Framework

A transition framework will also be introduced to give existing emissions-intensive trade-exposed (EITE) companies more time to adjust to a low-carbon economy. The allowances will be determined based on efficiency standards and decarbonisation targets. The transition framework is not applicable to new facilities.

Consultations on the framework for the use of international carbon credits and the transition framework are currently ongoing. Details will be shared in 2023, ahead of the implementation of the revised carbon tax framework in 2024.

Estimation of reckonable GHG emissions

In order to determine whether GHG emissions are equal to or above 2,000 / 25,000 tCO2e, and are thereby reportable / taxable, NEA has prepared a spreadsheet (download) to assist facilities in estimating the reckonable GHG emissions from fuel combustion, which is based on a list of common fuel types. Facilities would then have to estimate separately and input into the spreadsheet its reckonable IPPU emissions based on the type of activities/processes carried out.


Click here for more information on the Measurement and Reporting requirements for greenhouse gas emissions.

Click here for more information on the Verification and Accreditation requirements.