Australia has outlined plans to trade renewable energy certificates from next month and carbon credits from early 2010.

The move represents two major steps toward implementing the government’s climate change agenda.

Market operator ASX has announced that futures and options contracts in renewable energy certificates (RECs) would start on 24 November, with Certified Emission Reduction (CER) contracts to start trading in the first quarter of next year.

In Australia, each REC represents one 1MWh of electricity generated from renewable energy and can be earned by installing solar panels, wind turbines and micro-hydro plants, reports Reuters.

Trade in RECs aims to help ensure Australia meets its target for 20% of power to come from green sources by 2020.

In over-the-counter trade, REC prices have dropped to A$28.50 per certificate, the lowest level in more than two years, because the market has been flooded with RECs generated by installers of solar hot water panels and heat pumps, reports Reuters.