Firm net zero 2050 commitment is significant positive

“The Federal Government’s decision to adopt a formal economy-wide target of net zero emissions by 2050 will deliver an immediate boost to Australia’s transition, but a lot more work will be needed to flesh out the plan to get there,” Innes Willox, Chief Executive of the national employer association Ai Group said today.

“Planning, regulation and investment in Australia’s electricity system has been slowed by the lack of clarity on 2050. That confusion should now be definitively over. That means that electricity megaprojects like HumeLink or reforms like capacity mechanisms can be judged against the real future needs of our electricity system, rather than a scenario where emissions merely glide down. Clarity means quicker action and lower costs to energy users.

“However the broader plan in which this important commitment sits is still incomplete in many ways.

“Productivity Commission reviews of progress towards net zero are useful in principle, but the detail and role of these reviews needs to be explained. They should not introduce doubt about the strength of the long term commitment. And they should consider the state of transition and the economy throughout Australia.

“Updated 2030 emissions projections are a spur to development of more ambitious mid term emissions goals, not a substitute for them. There is more to be done here, including both with respect to upgrading the 2030 target and the follow-on target that must be developed in the next couple of years.

“Improvements in low-, zero- and negative-emissions technologies will be a strong wind in the sails of Australia’s transition. Most of those improvements will be driven by large-scale deployment, as businesses learn by doing and build economies of scale and stronger supply chains. The missing piece of the Technology Roadmap that forms such an important part of the Government’s emissions strategy is policies that will encourage and underpin that broad deployment.

“Policies in other major economies and movements in global markets will make our task much easier. But more will be needed than positive talk and transient Budget commitments to drive private investment and successful change here. The tests for new and expanded policies include both whether they compromise industry competitiveness today – and whether they build competitiveness for the decarbonised global economy that is emerging.

“There will need to be considerable engagement with industry and other stakeholders on the design and implementation of the measures foreshadowed today and all the further measures that will be needed. Good policy requires openness to business and community feedback and a willingness to accept scrutiny, criticism and the experience and expertise of people from many sectors, regions and walks of life.

“Today’s announcements are not an end, but perhaps a new beginning. With all levels of government and all major parties committed to Australia’s destination, the political contest and policy debate can focus on the smoothest route and the best vehicle to get us there. That is progress,” Mr Willox said.

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