Can Australia achieve its net zero goals?
In September 2025, the Australian Federal Government quietly released its national Net Zero Plan, accompanied by six sector-specific emission reduction plans and the long-awaited National Climate Risk Assessment.
While the Risk Assessment makes a compelling case for why this transition is essential, the Net Zero Plan itself is more aspirational goal setting at a time when Australia needs concrete and practical execution plans. The public and corporate community needs honesty and clarity from our government if we are to successfully navigate this transition.
The Net Zero Plan builds on Australia’s commitment under the Climate Change Act 2022 to reduce greenhouse gas (GHG) emissions by 43% by 2030 and achieve net zero by 2050. It introduces additional milestones for 2035, targeting a 62-70% reduction across the economy. Each of the six sector plans, covering energy, industry, agriculture, transport, resources, and the built environment, sets specific targets to contribute to these goals.
These are ambitious targets, but Australia’s challenge in achieving Net Zero is not ambition; it is execution.
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Targets and milestones may persuade voters that action is happening, but a goal without a plan is a daydream.
The plans published by the Department of Climate Change, Energy, the Environment and Water (DCCEEW) are not grounded in the daily realities faced by major parts of the economy. Australia’s emissions have decreased by an average of 8 Mt CO₂-e per year over the past five years. To meet the 43% reduction target by 2030, this rate must more than double to 18 Mt CO₂-e per year. Current trajectories suggest we are not on track.
Initiatives need lead time to be fully implemented and the infrastructure to support this transition simply isn’t there. In areas such as electrification, grid capacity, dispatchable generation, and renewable hydrogen, the required infrastructure is either still under development or significantly constrained. The reality is, these 2035 targets are not currently achievable without materially improving investment economics, accelerating planning approvals and realistic delivery timelines.
The problem isn’t that these targets aren’t laudable, or even that they are unachievable. The problem is that these plans don’t include the practical mechanisms, policy alignment and funding that are required to meet those targets.
The Climate Change Authority, which advised the DCCEW on these targets, acknowledges these gaps and calls for a clear policy and funding landscape that aligns a fragmented set of policies, regulations and funding streams, removes key implementation barriers and lowers investment risk to make long-term emissions projects bankable. The Net Zero plans we received do not provide that landscape. Instead, we have six sector plans that seem to expect the private market to fill funding gaps without commercial incentive.
At its core, this is an economic problem. Emissions carry a quantifiable cost, reflected in increased climate risks and environmental degradation. Australia has only recently begun to collate information on the impacts and actions through climate-related disclosures, while nature-related disclosures and broader accountability measures are still on the horizon.
Australia’s climate challenge extends beyond domestic decarbonisation. We must manage a globally exposed, resource-driven economy while positioning it to supply the energy transition. Australia is uniquely exposed to climate risk because our economy is globally integrated and heavily reliant on emissions-intensive exports. However, that exposure is also an opportunity. The same commodities that create transition risk, including coal, LNG, iron ore, sit alongside critical minerals and energy inputs that will underpin the global transition. The challenge for policy is not choosing between adaptation and mitigation, but positioning the economy to do both, thus managing risk while actively supplying the transition.
To be fair, progress is being made, and it’s important to acknowledge that perfection should not be the enemy of good. However, we must also be realistic. Large-scale public investment will ultimately be funded by taxpayers, and without clear, fair outcomes, there is a significant risk of public and political backlash and the lessening of Australia’s global competitiveness and energy security.
Bridging the gap between ambition and action will require more than setting targets and hoping the market responds. Australia needs coordinated, whole-of-government policy frameworks, greater regulatory certainty and strategic public investment to de-risk private capital. Effective climate policy in Australia needs to do three things in tandem: manage emissions, enable credible reduction pathways, and position the economy for the transition. Currently, we’re stronger on measurement and compliance than we are on enabling structural abatement.
Offsets alone won’t deliver the scale of change required.
We need policy that accelerates electrification, low-carbon fuels and methane reduction at scale. And critically, this must be supported by coordinated infrastructure including energy systems, storage, and transport, otherwise even the best policy signals won’t translate into real-world decarbonisation.
This includes streamlining permitting processes, ramping up workforce planning for emerging industries, and fostering collaboration across federal, state, and territory governments. Without these foundational steps, the road to net zero will remain a rocky one.
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