The BGA Australia team, led by Managing Director Michael “Mick” McNeill, wrote an update to clients about the opposition’s decision to abandon support for net-zero emissions.

Context

  • Australia’s Liberal-Nationals opposition has abandoned its policy of net-zero greenhouse gas emissions by 2050, putting climate change policy at the core of political debate for this parliamentary term. The major opposition partner, the Liberal Party, struggled to reach a position and continues to face disunity as it seeks to regain support in urban Australia following the opposition’s landslide defeat in the May elections. Amid concerns over rising electricity prices, energy security and the cost of the renewables transition, the Liberal Party is counting on voters blaming the pursuit of net zero for cost-of-living pressures.
  • Opposition leader Sussan Ley, a previous supporter of net zero, has had her authority undermined by the conservative wing of her party, and her leadership may be in peril. Prime Minister Anthony Albanese said the Liberal Party’s policy would damage investment and economic growth as well as Australia’s relationships with countries in the Association of Southeast Asian Nations (ASEAN) and the Indo-Pacific. But with low numbers in Parliament and record low numbers in opinion polls, the Liberal-Nationals opposition appears unlikely to return to government until at least the early 2030s.

Significance

  • The Liberal Party, like the regionally based Nationals, has abandoned its policy of net-zero emissions by 2050. The party will retain support for Australia remaining in the 2015 Paris climate agreement but will only adhere to targets set by the government. The party will not set its climate targets. A Liberal government would repeal the Labor government’s 2022 Climate Change Act, which enshrined into law an emissions-reduction target of 43 percent from 2005 levels by 2030 and net-zero emissions by 2050. Liberal Party members of Parliament and senators discussed climate change policy November 12, and the Liberal shadow ministry finalized a position November 13. Shadow ministers from the Liberal Party and the Nationals will meet shortly to adopt a unified opposition policy.
  • A Liberal government would abolish Labor’s 82 percent renewables by 2030 target. There would be “no premature closure of coal plants,” the prohibition on nuclear energy would be lifted and uranium would be added to the critical minerals list. Contracts not finalized under Labor’s Capacity Investment Scheme and Rewiring the Nation would be reviewed. Opposition leader Ley said the Liberal policy “removes a lot of subsidies, artificial structures and regulation that’s in the wrong place and doing the wrong thing, and it’s clear and it actually can deliver for investors.”
  • A technology-neutral Affordable Energy Scheme would support “modest, targeted underwriting” to increase supply “by giving investors certainty across all technologies including gas, hydro, batteries, coal and renewables in the right place.” The Liberal-Nationals would scrap “punitive” mandates under the Safeguard Mechanism that currently requires Australia’s heaviest emitters to reduce emissions by 4.9 percent each year until 2030, abolish penalties under the National Vehicle Emissions Standard and scrap business tax concessions for electric vehicles. The Labor government’s Net Zero Plan is anchored by the Safeguard Mechanism. It will be reviewed from 2026-2027 to ensure it is supporting progress toward the 2035 emissions target.

Implications

  • Prime Minister Albanese, who held a bilateral meeting with his Indonesian counterpart on November 12, said the Liberal Party’s policy was “quite contradictory to what our Pacific neighbors want and what Indonesia and our ASEAN neighbors are calling for.” The Albanese government has put climate change action at the core of its diplomatic agenda. It is lobbying to host the Conference of the Parties (COP31) under the United Nations Framework Convention on Climate Change next year and is seeking support from Pacific island nations amid intense strategic competition in the region between Australia and China. The Labor government in September announced an updated Paris agreement target of a 62-70 percent reduction in greenhouse gas emissions by 2035 — from 2005 levels — and net zero by 2050.
  • The Labor Party and the Liberal-Nationals opposition agree that gas will be a critical transition fuel for at least the next decade. Experts in Australia have growing doubt whether the rollout of renewables will keep pace with the projected retirement of all coal-fired power stations in the next 15 years. The government is undertaking a review of gas market regulations that is examining the Australian Domestic Gas Security Mechanism, the Gas Market Code and the heads of agreement with major east coast gas exporters.

We will continue to keep you updated on developments in Australia as they occur. If you have any questions or comments, please contact BGA Australia Managing Director Michael “Mick” McNeill at mmcneill@bowergroupasia.com.

Best regards,

BGA Australia Team

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Managing Director

Mick is a highly-experienced government relations expert and trusted advisor on consensus building, conflict resolution and legislative developments. He has played an integral role in helping parties achieve desired outcomes in areas of national security, health policy, foreign policy and reputational crisis management, as well as media relations, communications campaigns, immigration and human rights. Mick has two decades’ experience working with government as a media analyst, political adviser and NGO advocacy manager. After a stint serving as an adviser to an Australian senator, Mick took on the role of the locally engaged senior political specialist at the U.S. Embassy in ... Read More