Australia's Climate Policy and Energy Transition: a Rollercoaster Ride

Australia’s climate change policy has been through radical changes, with governments strongly committed to climate action followed by another which abolished carbon pricing and dismantled other aspects of climate policy. Under the present government it is expected that Australia will display a forward looking stance on climate policy. Australia’s emissions target of a 26 to 28% reduction in emissions by 2030 on 2005 will require significant effort if it is to be achieved domestically, given the relatively fast growing economy and population.

The political ructions over climate policy reflect a deep conflict between Australia’s inherent interest in strong global climate change action and its large coal endowment. But Australia is also blessed with practically unlimited low-cost potential for renewable energy, and a close to 100% renewable power supply is a possibility by mid-century. The challenge is how to facilitate the transition from the energy and carbon intensive structures of the past. Transition from coal to renewables getting underway in power supply, and there is also great potential for improved energy efficiency throughout the economy. Questions of economic policy and regulatory reform loom large. Insights from Germany’s energy transition process are relevant, and aspects of Australia’s coming energy transition could be interesting to Germany.