Finally. It’s the climate policy review we had to have…

bradkerin Market Intelligence

by Peter Castellas, Chief Executive Officer of the Carbon Market Institute.

Any informed industry participant or government representative will be aware that if Australia is to meet its Paris targets, our current climate policy suite must evolve significantly to drive the emissions reductions required.

It should be remembered that our international commitment of 26%-28% reduction below 2005 levels is the floor of what we will be required to deliver as Paris commitments inevitably become more ambitious with each review period out to 2030.

Ultimately, the Paris Agreement sets the path to a zero net emissions world. There is only one way the global emissions trajectory is headed – down! So, for Australia, the existing commitment is a below business as usual challenge that is only going to get more onerous. That is why this review is so timely and so critical.

If we put off hard decisions because its not politically expedient to do so, or it might not play well in the Murdoch press, then it will cost our business, our economy, our environment and our people. The government has a massive responsibility to ensure the outcome of this review is meaningful and impactful – and business has a huge responsibility to provide constructive, authoritative input.

If our largest trading partners, major global corporations and leading sub national governments can use the words “carbon pricing” and “emissions trading”, why shouldn’t we? The lens of a zero net emission economy is how many countries are starting to calibrate their policy suite and it is, in my view, the long term goal that we need to be reviewing and setting policy direction against.

We will ultimately transition to a market based approach to emissions reduction and it would be helpful for business and finance if the review led to sending clear policy signals to help stimulate the investment in clean energy and technology, emissions avoidance and carbon abatement required.

We also need to get our ambition right and to engage better with the community as to why we need to act on climate change. The review rightly questions how climate policy may impact jobs, investment, trade competitiveness, households and regional Australia. There is a role to play for both government and business in actively engaging across these themes and stakeholders groups, to explain the risks and opportunities that a changing climate presents.

It’s time to get serious about climate policy, raise the level of maturity of the debate, and set Australia up to be an economy that benefits from the zero carbon transition.

This all makes for fascinating discussions at the 4th Australian Emissions Reduction Summit on 2-3 May at the MCG in Melbourne, and I hope you will join the conversation at the premier climate change and business event in the Asia Pacific.

Bring it on.