In March 2023, ACR signed a Memorandum of Understanding with Singapore’s National Environment Agency (NEA), as part of the country’s efforts to operationalize Article 6 of the Paris Agreement.

Companies regulated under Singapore’s Carbon Pricing Act, which covers about 80 per cent of national GHG emissions, will be allowed to use high-quality international carbon credits to offset up to 5% of their taxable emissions starting in 2024. The MoU details terms of cooperation between ACR and NEA to facilitate Singapore-based companies in exercising this option through the purchase and retirement of eligible ACR credits.

Starting in 2024, Singapore-based companies can acquire high-quality carbon credits issued by ACR and other approved international offset programs and surrender them to the Singapore Government, as long as the carbon credits meet government criteria.

The carbon tax is intended to support Singapore’s increased climate ambition to achieve net zero emissions by or around mid-century. Allowing companies to surrender high-quality international carbon credits to offset up to 5% of their taxable emissions starting in 2024 offers an option to cushion the financial impact to companies and to create local demand for high-quality carbon credits sourced from around the globe.

Singapore will continue consultations on the transition framework to allow existing emissions-intensive trade-exposed companies more time to adjust to a low-carbon economy as well as on the framework for the use of carbon credits.

For more information, please visit https://www.nea.gov.sg/our-services/climate-change-energy-efficiency/climate-change/carbon-tax.