Australia has entered a defining moment. In the past week, the Government outlined a 2035 emissions target of 62–70% below 2005 levels and released Australia’s first National Climate Risk Assessment. Whatever your politics, two truths now stare us in the face: climate impacts are compounding and markets are moving. Leadership—clear, practical, nation-building leadership—will determine whether this decade becomes a drag on our prosperity or the springboard to it.
Missing the point
The standard debate is stuck: “too costly” on one side, “too timid” on the other. Both miss the point. Net zero, done well, is a productivity agenda. Every major leap in living standards—steam, steel, electricity, digital networks—was built on engineering advances and system redesign. Today’s equivalent is the build-out of renewable grids, electrified transport, advanced materials, robotics and new food systems, alongside AI. These shifts don’t merely cut emissions; they lower operating costs, unlock new exports, and modernise the economy.
The economics are not vague. Australia’s electricity market operator confirms the lowest-cost power system, as coal retires, is renewables + transmission + storage, backed by gas. CSIRO’s latest GenCost confirms the same conclusion: new renewables remain the cheapest new-build generation in Australia. That’s not ideology; it’s engineering economics.
Cumulative upside
Crucially, we are underestimating the cumulative, non-linear potential of these technologies. Solar keeps scaling at record pace—global photovoltaic capacity surged to 1.6 TW by 2023—while lithium-ion battery pack prices fell 20% in 2024 to US$115/kWh, the steepest annual drop since 2017. When technologies sit on steep learning curves with global supply chains behind them, cost and performance inflect faster than most models assume. That’s why “direction + momentum” matters more than any “perfect blueprint” in complex transitions.
For households and firms, the opportunity is material. Treasury analysis associated with the 2035 target and broader electrification modelling points to meaningful bill savings when homes and businesses electrify. Headline figures of up to $4,300 per year for fully electrified households are being debated, but the wider direction is consistent with CSIRO-backed studies showing substantial savings from switching to electric vehicles, appliances and energy efficiency. The key is equitable access—especially for renters—as we scale programs that help all Australians capture the upside.
Can we afford it?
“Can we afford it?” flips, on inspection, to “We can’t afford not to.” Australia’s insurers report that extreme-weather costs have more than tripled as a share of the economy over three decades, and even with a quieter 2024, the longer-term claims trend is upward. The Government’s own climate-risk assessment underscores cascading risks across health, infrastructure and supply chains. The bill for inaction is higher premiums, disrupted logistics, asset write-downs and lost output.
Will markets punish us if we move?
The opposite is true. The EU’s Carbon Border Adjustment Mechanism (CBAM) comes into full force in 2026, pricing carbon at the border for steel, aluminium, and other carbon-intensive imports. Our trading partners are re-wiring their economies; the question is whether Australian producers meet that standard or cede market share. Per-capita emissions remain high by global standards, and while our absolute share is modest, trade exposure makes credibility a competitive asset.
Isn’t finance the constraint?
No. Capital is abundant; Australia’s superannuation sector now manages $4.3 trillion and investors are actively seeking credible, de-risked transition projects. The barrier is not money; it’s bankability—permitting, approvals, grid access, and stable market design. Fix those, and we unleash domestic and global capital at scale.
What about Australia’s export engine?
Treasury modelling points to a $50 billion annual decline in fossil-fuel export earnings by 2035 as global demand shifts, with further falls by 2050—yet anticipates a surge in green commodities (hydrogen, green iron, aluminium, critical minerals) if we move quickly. In other words: the “whether to transition” question is closed; the remaining choice is how to win the next export era.
So what must we do now?
First, treat net zero as nation-building, not costly compliance. Prioritise the system bottlenecks: transmission corridors, faster and fairer approvals, modernised grid rules for distributed energy, and long-term procurement and firming markets that crowd in private capital. Australia has done hard coordination before—post-war reconstruction, the Snowy, and the reform era of the 1980s. We can do it again.
Second, mobilise the engineering core. Productivity isn’t everything, but in the end it’s almost everything—and right now, engineering is almost everything. We need the problem-solvers who design, build and run complex systems—power, transport, materials, food—to lead delivery with industry, states and communities. This is about execution, not slogans.
Third, build a cross-sector coalition of doers. The greatest untapped resource in Australia is not gas, lithium or even capital—it’s human problem-solving capacity. When leaders engage differently—aligning incentives across government, business, finance and communities—entrenched challenges collapse in days, not decades. Let’s convene an active leadership group—more Snowy Commission than talking shop—charged with surfacing bankable projects, sequencing delivery, and reporting publicly on progress.
To the critics
A few responses to the critics:
- “We’re too small to matter.” Our per-capita emissions are among the world’s highest, our exports are exposed to carbon border taxes, and our competitiveness depends on credibility. Markets are not waiting.
- “It’s all cost.” The least-cost power pathway is already mapped; electrification lowers lifetime bills; delay increases system costs and climate damages.
- “The plan isn’t perfect.” Complex transitions don’t move in straight lines. Direction + learning + momentum beats paralysis. The evidence on technology learning curves is unambiguous.
Australia has the assets—sun, wind, minerals, capital—and the know-how. What we need now is an energised coalition of leaders—practical, visionary, determined—who will champion, drive and guide the transition in the public interest. This is not about partisanship. It is about execution at pace and productivity with purpose.
This is the moment for doers, not doubters—for a nation ready to build, to lead, and to thrive.
