Net zero takes authority in Australia

Australian coal power will face the Authority. Credit: Robyn Charnley via Shutterstock

After the decarbonisation reluctance of the previous government, Prime Minister Anthony Albanese has pushed toward net zero. Now, the Australian Government has given power to a new legislative branch.  

In May, the government established a Net Zero Authority to ensure the workers, industries and communities that have powered Australia for generations can seize the opportunities of Australia’s Net Zero transformation. This process could dramatically alter the balance of power in the country, holding both industry and government to account over emissions.

For a start, the government will legislate the Net Zero Authority following detailed design work, in consultation with stakeholders.

From the start of July, this agency will exist within the office of the Prime Minister, eventually advising on the establishment of itself as a legislated agency.

A surprising amount of global taskforces on Net Zero are either voluntary, unmandated or ill-equipped for purpose. The core of any meaningful power stems from legislative certainty in law, which the Australian system will have. This seems like a positive step for green technology.

The Authority will engage with key regions, industries, investors and others to develop strategies for how the Australian Government can best support positive transformation. It will also consult across government and stakeholders to refine the functions and powers of the Authority before legislation is developed.

This too suggests a strong authority. The best legislation and the most transformative government agendas tend to stem from a strong consultation process that engages all stakeholders before the laws hit the ground.

There are wider, if slightly vaguer, promises on the way too. These include a goal to support workers in emissions-intensive sectors to access new employment, skills and support as the net-zero transformation continues.

The government also promises that the Authority will coordinate programs and policies across government to support regions and communities in attracting and taking advantage of new clean energy industries, setting those industries up for success, and helping investors and companies to engage with net-zero transformation opportunities.

The Australian Government says it has a mandate to make Australia a renewable energy superpower. It promises a “rewiring” of the nation, investing in new renewable storage and generation capacity, revitalising manufacturing and developing clean industries.

The Net Zero Authority will help steer the Government’s agenda to support communities, workers and industries. The promise is that its mission is aligned to the Paris Agreement and that it will ensure no one is held back as the economy changes.

The Authority will focus on regions and industries that have traditionally powered Australia’s economy. As traditional industries adapt and transform, the Authority will work to ensure new ones are coming online.

Finally, the Authority will also work collaboratively with state and territory governments, and existing regionally-focused bodies, reflecting the shared responsibility of all levels of government to support the change to a clean energy economy.

Encouragingly, it appears that Australia’s Net Zero Authority is part of aligned aspirations to grow economic and environmental benefits.

On 2 June 2023, Prime Minister Anthony Albanese met with Singapore’s Acting Prime Minister Lawrence Wong for the 8th Australia-Singapore Annual Leaders’ Meeting (ALM). Both leaders noted the implementation and progress of the Singapore-Australia Green Economy Agreement (GEA), signed in October 2022.

This agreement paves the way for Australia and Singapore to take ambitious climate action while “seizing” the economic opportunities of the Net-zero transition. The leaders announced three GEA initiatives.

First, a joint A$20 million Go-Green Co-Innovation Program that would aid trade for small and medium-sized businesses in “green” industries. This would come alongside the establishment of a Green and Digital Shipping Corridor by the end of 2025, and a S$5 million Convergence Asia Climate Solutions Design Grant.

Singapore would be unlikely to make financial commitments without the existence of a legislative body to drive Australia’s side of the bargain, namely the new Net Zero Authority.

There is also change on the US side of Australian relations. In May, Albanese signed a statement of intent with President Biden to take forward a Climate, Critical Minerals and Clean Energy Transformation Compact with the US, as well as a releasing a broader Joint Leaders’ Statement highlighting the breadth of cooperation between Australia and the United States.

All focussed on the opportunities of the net-zero transformation, and all came about in the days after the launch of the Authority.

It is worth noting that the mere existence of authorities and pledges doesn’t guarantee progress. The UK’s net zero pledges, for example, were recently found illegal amid suspicions of greenwashing.

A new agency alone, even legally mandated, cannot guarantee the best path forward. That said, coordination and cooperation can.

In February, the Australian Industry Energy Transitions Initiative (ETI) launched its Decarbonisation Pathways report, featuring a strong alignment with net zero. The paper argues that it is possible for five of Australia's most significant heavy industry supply chains to transition to net zero, consistent with global efforts to limit warming to 1.5°C. It also finds that strong, effective and co-ordinated action from government, industry and finance is crucial for the net-ero transition.

The report calls for a clear decarbonisation framework with a net-zero goal. Additionally, it demands acceleration of development and demonstration of the emerging technologies needed, and better deployment of low-carbon solutions and integrated net-zero emissions industrial regions, supply chains and energy network solutions.

“Commitment from industry to the long-term transition is a positive step towards developing the capabilities needed, avoiding the risk of stranded assets and higher long-term energy costs, and for ensuring a future in which Australian energy-intensive industries are competitive in a decarbonised world,” said Australian Industry ETI chair, Simon McKeon.

“With strong ambition, coordinated action and government support, industry emissions could be reduced by up to 92% by 2050, based on 2020 levels. This, with high quality and verifiable offsets for the remaining 8%, would transition industry to net zero emissions in support of the ambition to limit warming to 1.5°C.”

Net zero efforts tend to live and die on their perceived commitment. Right now, there is no reason to suspect that the Authority cannot do real good on the energy transition. But creating a new agency, in isolation, doesn’t get the job done. Real world cooperation, targets and strategies that work on a business level are the tools for success.