Australia likely to announce 2035 emissions reduction targets before COP30: minister

Australia is likely to announce its 2035 emissions reduction targets ahead of the UN Climate Change Conference, or COP30, in Brazil this November, after the government receives advice from the Climate Change Authority, Minister for Climate Change and Energy Chris Bowen said recently.

The CCA is developing advice on the 2035 emissions reduction targets for Australia's next Nationally Determined Contribution, according to its website, in what would be a key component of the country's dynamic energy transition policies.

The new NDC will be shaped "after I've received advice from the CCA and I've worked it through the cabinet processes, and then it will be released in due course in accordance with most countries around the world," Bowen said last week, according to transcripts seen on May 19.

"It will take me a little bit of time to take it through the cabinet, but it will be out well and truly before COP30," Bowen added.

The CCA's advice will align with the Paris Agreement and be developed after analyzing the emissions budget and international factors such as trade, foreign policy and other countries' approaches, the authority said on its website.

The CCA said its advice will be evidence-based and achievable "to drive more ambitious climate action," according to its website. It will also assess economic impacts and examine sectoral decarbonization pathways.

The CCA, which launched a consultation in 2023, will examine the opportunities and costs to the Australian economy of various emission reduction pathways and targets at the national, sectoral and regional levels, it added.

Australia's latest NDC under the Paris Agreement commits the country to reducing greenhouse gas emissions by 43% below 2005 levels by 2030 and achieving net-zero emissions by 2050.

Waiting on renewable hydrogen

Bowen said natural gas will play an important role in Australia's energy transition to back up renewables due to its flexibility while the renewable hydrogen sector evolves and moves toward commercialization.

"Gas-fired power is flexible, so it can be turned off during the day when we've got all these wonderful products working well, and it can be turned on if we need to at night, and it can be turned off again very quickly," he said.

"Of course, it also plays a role in supporting heavy industry while we're waiting for green hydrogen to become more commercial," he added.

Until then, the government will continue "a carefully calibrated, moderate policy" to ensure an ongoing role for gas in the system, with a continued review of existing policies' effectiveness and the option to do more if necessary, Bowen said.

A key goal of Bowen's Labor Party, reelected in May, is increasing renewable power on the electricity grid to 82% by 2030. This aligns with the Rewiring the Nation plan, which includes an A$20 billion ($12.82 billion) fund aimed at accelerating investment in electricity transmission projects to support the transition to renewable energy.

Bowen said renewables accounted for 43% of the electricity supply in the first quarter of this year, reflecting a clear uptrend in the generation mix despite the intermittency of the technology.

"We went to the Australian people and said we have a carefully designed, appropriate policy with a mix of technologies, including gas backup, transmissions, storage, household, community, and grid scale, to get to 82% renewables by 2030," he said, referring to his recent election campaign.

Capacity Investment Scheme auctions

With this renewable generation target on the horizon, the government will signal to the industry in advance -- providing appropriate certainty -- about the six-monthly auctions conducted under the Capacity Investment Scheme, Bowen said.

"It's been very, very successful so far. ...The auctions will continue between now and 2027, [though] not every auction will be exactly the same," he said.

"We'll continue to calibrate in response to the market and to the successful bids that we get, but it's the central underpinning of our plans to get to 82% renewables, and we'll continue to roll it out," he added.

The Capacity Investment Scheme, a revenue underwriting program designed to accelerate investment in renewable energy generation such as wind and solar, was launched in 2022, with tenders beginning the following year.

Offshore wind progress

Bowen said his department will continue work on the offshore wind plan covering six zones -- Gippsland and the Southern Ocean in Victoria, Hunter and Illawarra in New South Wales, Bass Strait in Tasmania and the Indian Ocean in Western Australia.

"They're all at different levels [of progression]," he said. "Gippsland is the most advanced, but we'll just continue to implement the policy, including issuing licenses where appropriate within the six zones."

Data from Platts, part of S&P Global Commodity Insights, showed that Australia's greenhouse gas emissions are projected to fall from 541.07 million mtCO2e in 2023 under an inflection scenario to 490.84 million mtCO2e by 2030.