Federal energy policy provides for emissions reductions in electricity sector

A positive feature of the new National Energy Guarantee announced this week is that emissions reductions have been given a clear focus in electricity policy, according to ClimateWorks Australia.  

ClimateWorks Australia CEO, Anna Skarbek said federal and state governments have been given the task of setting the trajectory for emissions reductions in the National Electricity Market. This is consistent with the Finkel Review recommendations.  

“The key question now is whether the trajectory to be set for the guarantee will be strong enough for Australia to meet its current and future climate obligations under the Paris Agreement,” Ms Skarbek said.  

“Having a trajectory for emissions reduction in the electricity sector will be a big step forward.” 

Ms Skarbek said a recent ClimateWorks report, Power Up showed decarbonising the electricity sector was crucial to meeting our commitments under the Paris Agreement, including a long-term commitment to net zero emissions by 2050. 

“Electricity creates over one third of Australia’s total emissions.  If we don’t reduce the emissions in our electricity, then we don’t unlock other emissions reduction opportunities such as electric vehicles,” she said. 

Ms Skarbek said if the government’s National Energy Guarantee aims at cutting emissions by only 26 per cent by 2030 then other sectors across the economy would have to make greater emissions reductions sooner.   

“Our research shows that Australia’s electricity sector can cut emissions by 60 per cent below 2005 levels by 2030. Harnessing this potential will help us to reach future targets which progressively increase under the Paris Agreement,” she said. 

“If you don’t achieve deep emissions reductions in the electricity sector, a major strengthening of policy will be needed for the other sectors where there is less momentum currently. For example stonger action would be needed in transport, buildings, industry and land. 

“Our report shows that existing policies are currently only harnessing 5 per cent of emissions reduction potential in the non-energy sector, and would have to reach 50 per cent of that potential if the electricity sector target is set at 26 per cent.” (see attached chart) 

Ms Skarbek said the federal government was reviewing national climate policy by the end of the year and today’s announcement – while a key component - only covers electricity supply.  

“Australia’s climate policy will need to cover more than just the electricity sector,” she said. 

“Other measures should include the introduction of vehicle emissions standards, a more stringent national building code, a dramatic improvement in the uptake of energy efficiency measures across industry and stronger incentives for reforestation. 

“Frequent reviews, including by CSIRO and AEMO, have shown that the electricity sector can reduce emissions without compromising affordability or reliability.”  

Media Contact: Aileen Muldoon 0419 112 503 www.climateworksaustralia.org 

For a copy of ClimateWorks Australia Power Up report go to: Power Up - Australia’s electricity sector can  and should do more to deliver our climate commitments   


ClimateWorks Australia is an expert, independent adviser, committed to helping Australia transition to net zero emissions by 2050. It was co-founded through a partnership between Monash University and The Myer Foundation and works within the Monash Sustainable Development Institute.