Singapore carbon tax hike spurs demand for credits, but companies face supply crunch

[SINGAPORE] Demand for carbon credits is projected to rise among Singapore corporates, say market watchers, as carbon tax-liable companies look to purchase credits to offset up to 5 per cent of their taxable emissions. 

This comes as Singapore’s carbon tax increased to S$45 per tonne of carbon dioxide equivalent (tCO2e) from Jan 1, almost double the previous rate of S$25 a tonne. 

However, there are concerns that there may not be enough supply of credits that meet Singapore’s eligibility criteria under its International Carbon Credit (ICC) framework.