Australia's climate future hangs in the balance! Imagine a world where we slam the brakes on our journey to net-zero emissions. What would that even look like? The Coalition's recent shift away from their 2050 net-zero pledge has thrown a wrench into the works, raising serious questions about the future of Australia's climate policies.
Back in 2021, the Coalition government, led by then-Prime Minister Scott Morrison, committed Australia to achieving net-zero emissions by 2050. This commitment (https://www.theguardian.com/australia-news/2021/oct/26/scott-morrison-says-australia-2050-net-zero-emissions-plan-based-on-choices-not-mandates) signaled a significant step towards addressing climate change.
Fast forward four years, and the political landscape has shifted dramatically. Following consecutive election defeats, the Liberal and National parties – the Coalition – have unveiled a new climate strategy (https://www.liberal.org.au/2025/11/16/affordable-and-responsible-the-coalition-plan-for-affordable-energy-and-lower-emissions) that prioritizes keeping coal-fired power plants running longer and abandoning the net-zero target. But here's where it gets controversial... is this a pragmatic approach to energy security, or a dangerous step backward in the fight against climate change?
If the Coalition wins the next election and implements this plan, it would trigger a sweeping overhaul of Australia's climate policies. Many initiatives designed to reduce carbon emissions and promote climate action would likely be scrapped. They state their intention to uphold Australia's commitments under the Paris Agreement, but it remains unclear whether they would maintain the current pledge to cut emissions by 62-70% below 2005 levels by 2035. This raises a crucial question: Can Australia truly meet its international obligations while simultaneously extending the life of coal-fired power plants?
The Coalition argues that emissions would still decline under their plan. And this is the part most people miss... They emphasize investments in technologies like carbon capture and storage, alongside a greater reliance on nuclear energy. But is this realistic? Extending the lifespan of coal plants would inevitably lead to increased emissions, and nuclear power plants take years, even decades, to plan, approve, and construct. While emissions have decreased in the electricity and land use sectors, every other key sector has seen increases over the past two decades. As of 2023, Australia's per capita emissions remain among the highest (https://ourworldindata.org/grapher/per-capita-ghg-emissions) in the developed world, standing at a staggering 22 tonnes per person.
So, what policies are currently in place to curb emissions? And what would be the consequences of dismantling them? Let's dive in.
Australia's existing emissions reduction policies encompass a wide range of measures, from economy-wide targets to sector-specific initiatives.
On a national scale, we have the legally binding target of reducing emissions by 43% by 2030, as well as the overarching goal of achieving net-zero emissions by 2050.
Furthermore, there's the Renewable Energy Target, which aims to generate 82% of electricity from renewable sources by 2030, the New Vehicle Efficiency Standard designed to lower emissions from new cars, and the Safeguard Mechanism, which targets emissions from heavy industry.
These are the policies that would likely face the chopping block under a Coalition government.
The Coalition's plan to scale back Australia's net-zero efforts would also likely involve removing references to emissions reduction from the national electricity objectives (https://www.aemc.gov.au/regulation/neo), which guide the energy market regulator, eliminating fringe benefit tax exemptions for electric vehicles, and lifting the moratorium on nuclear power.
Let's take a closer look at some of these key policies and what their potential removal could mean:
Renewable Energy Target (RET):
The Renewable Energy Target (https://cer.gov.au/schemes/renewable-energy-target) was initially introduced in 2001 by the Howard Coalition government. It was designed to incentivize the growth of renewable energy sources by setting a target for the amount of renewable power fed into the electricity grid each year.
The initial target was a modest 2% renewable energy. In 2007, the Rudd Labor government significantly increased the target to 41 terawatt-hours (TWh) by 2030, which was projected to represent approximately 20% of total electricity generation.
In 2015, following a review by the Abbott Coalition government, the target was revised downwards to 33 TWh by 2025. This revised goal was successfully met in 2021. The policy is slated to remain in effect until 2030. Wind and solar generators continue to receive renewable energy certificates for each unit of electricity they generate, but the demand for these certificates has declined since the target has already been achieved. As a result, the Renewable Energy Target legislation is no longer the primary driver of new renewable energy investments.
Capacity Investment Scheme (CIS):
Launched in late 2022, the Capacity Investment Scheme (https://www.dcceew.gov.au/energy/renewable/capacity-investment-scheme) has played a crucial role in underwriting new renewable energy projects. It's a key factor behind the significant pipeline of new projects, alongside state government renewable energy targets and incentives. The scheme aims to facilitate the achievement of 82% renewables and an additional 40 gigawatts of power generating capacity by 2030.
The scheme has been further propelled by favorable economics. Renewables are now the most cost-effective (https://www.csiro.au/en/news/all/news/2025/july/2024-25-gencost-final-report) way to generate electricity, even after factoring in the cost of adding storage to ensure a reliable and consistent output.
This economic reality suggests that the transition away from aging coal-fired power plants – which are becoming increasingly unreliable, expensive to maintain, and unable to compete with renewables – will likely continue regardless of government policies. Removing either the RET or the CIS is unlikely to halt the shift away from coal entirely.
Safeguard Mechanism:
Currently, electricity generation accounts for only 30% of Australia's total emissions (https://www.dcceew.gov.au/climate-change/publications/national-greenhouse-gas-inventory-quarterly-updates). Fossil fuel use in buildings and industry contributes 24%, transport 19%, agriculture 16%, and waste and fugitive emissions 12%. Policies are in place to address emissions from some of these sectors.
One of the most significant is the Safeguard Mechanism, initially introduced in 2016 by a Coalition government and subsequently significantly strengthened by the current Labor government in 2023. It covers a substantial portion of industrial energy use, encompassing 215 of Australia's largest emitting companies. Under the mechanism, the government's baseline emissions target is reduced by 5% per year. Companies that outperform this target earn certificates that can be traded with other companies that exceed their targets. In essence, it functions similarly to a carbon pricing mechanism.
Without the Safeguard Mechanism, there would be little incentive for these major industrial emitters to reduce their emissions.
Australian Carbon Credit Unit (ACCU) Scheme:
Australia's carbon credits scheme operates by awarding certificates for activities that reduce carbon emissions in sectors not covered by other policies, with a particular focus on agriculture. These certificates can be sold privately, to the government, or traded through the Safeguard Mechanism to offset industrial emissions. The Coalition's proposed new policy would create a variation of the scheme known as the Accountability and Baseline Credit scheme. This would be voluntary and is unlikely to create any real incentives to cut emissions.
New Vehicle Efficiency Standard (NVES):
Australia's transport emissions are on the rise. Based on current trends, the transport sector is projected to become the largest source of emissions in Australia within the next five years (https://www.climatechangeauthority.gov.au/sites/default/files/documents/2024-09/2024SectorPathwaysReviewTransport.pdf). In July, the government introduced the New Vehicle Efficiency Standard – the first legislation passed that requires new vehicles sold in Australia to meet minimum average efficiency standards across a carmaker's fleet.
Prior to this, Australia was the only OECD country without vehicle efficiency standards. The target mandates a roughly 50% reduction in average emissions for new passenger vehicles across a carmaker's fleet by 2030 compared to 2025. It is expected to accelerate the adoption of electric vehicles (EVs) (https://electricvehiclecouncil.com.au/media-releases/ev-choice-booming-as-new-standards-kick-into-gear/). However, because the standard only applies to new vehicles, the sector's emissions will decline gradually over time. If the standard is repealed, it is unlikely that emissions from the car fleet will decrease at all.
Where does this leave us?
If the Coalition is elected, their retreat from net zero suggests that many, if not all, of these policies would be scrapped.
The declining costs of renewables and energy storage mean that the electricity sector will likely continue to become cleaner, even without government intervention. But that would leave approximately 70% of Australia's total emissions without any policy incentives to drive them down.
It's important to acknowledge that the current government's policies may not be sufficient to meet long-term emissions reduction targets either. Significant gaps remain in areas such as agriculture, trucking, and aviation, and policies targeting industrial emissions leave a substantial portion of the sector unchecked.
If the current set of policies were to be dismantled, it's difficult to envision how Australia could ever fulfill its international commitments to reduce emissions under the Paris Agreement.
Now, it's your turn! Do you believe the Coalition's plan is a realistic alternative, or a dangerous step backward? How important is it for Australia to meet its international climate commitments, even if it means potentially higher energy costs in the short term? Let us know your thoughts in the comments below!
