The Albanese Government is reportedly set to announce its new National Determined Contributions  ( NDCs) to 2035 this week – its emissions reduction targets under our Paris Agreement obligations.

Today, the case for strong NDCs was definitively settled. The government’s National Climate Risk Assessment modelling paints a devastating picture of the economic, health and social impacts of climate change.

Our emissions reduction target is the key benchmark around which our energy and climate policies are built. It is the critical determinant of the rate of decarbonisation of our economic and energy system to align with the climate science.

Our current national target is a 43% emissions reduction on 2005 levels by 2030 and net zero by 2050. Pressure has been building for the government to set a more ambitious interim 2035 target significantly above 43%, and in the range of 65–75%.

A recent report by the peak business lobby, the Business Council of Australia, on the capital required to achieve 50%, 60% and 70% cuts argued that a cut higher than 60% will require investment exceeding $400 billion, and that a goal to slash emissions by 70% by 2035 could risk our economic competitiveness. The report omits the benefits to GDP of an accelerated transition and totally ignores the massive and rising economic and social costs of not doing so.

This position evokes shades of the BCA’s intervention ahead of the 2019 federal election when it claimed the 45% by 2030 emissions reduction target proposed by the then Labor Opposition would be “ economy wrecking” – a contention weaponised by climate denialists and energy transition wreckers of the LNP. The latter retained government with a pathetic target of 26%-28% and ramped up the climate wars while decelerating our energy transformation. We are still paying the price.

Major businesses are backing 75% by 2035. The new Business for 75% group — which includes Atlassian, Canva, Fortescue, IKEA and Future Group — has published Deloitte modelling showing a 75% target will be a lower-cost pathway to net zero by 2050 than a target of 65%, reducing the overall cost of reaching that goal by bringing forward investment in critical industries and technologies. Under a 75% scenario compared to 65%, GDP would be $227 billion greater by 2035, growing to $490 billion by 2050, with export revenues $190 billion higher by 2050.

Both positions identify that strategic national interest public investment and private capital mobilisation are pivotal to our chances of achieving emissions cuts ambitious enough to accelerate our green economic growth and responsibly play our part in mitigating climate change.

As the BCA correctly stated, the bulk of emission reductions would need to come from the industrial, electricity and resources sectors.

To get a sense of the pace and scale of investment into these sectors, CEF has been tracking government support for cleantech, clean energy and resource decarbonisation. Funds put on the table for deployment since 2023 federally and by the states amount to $67 billion. This includes funding committed under Future Made in Australia, the Clean Energy Finance Corporation, the Australian Renewable Energy Agency, the National Reconstruction Fund and other authorities and programs.

Our tracking shows $18 billion of cleantech capital allocations have been deployed or tendered out since December 2024, into projects such as large-scale transmission, batteries, critical minerals processing, green metals, green hydrogen and distributed consumer energy resources such as the wildly successful $2.3 billion home battery program.

However, while the pace is picking up, the pattern to date has been one of under deployment of allocated capital.

A credibly ambitious emissions reduction target is contingent on getting funds to decarbonise industry and the grid out the door faster. This should be a top-tier national priority.

For example, less than 5% of the NRF’s $15 billion allocation has been deployed. The remaining $14.4 billion should be deployed within this term of government, sending a signal to industry that investment is real and imminent.

As we and our partners at the Climate Capital Forum have argued, streamlining the above programs — implementing simplified one-round application models like in the government’s large-scale renewables Capacity Investment Scheme — could rapidly unlock the idle capital.

Timely funding releases are also vital to accelerating clean energy infrastructure development by building private sector confidence, derisking and crowding in private capital. Every dollar of public money invested by the CEFC into our transition catalyses more than $4 of private investment.

The naysayers objecting to industry assistance for Australia’s green reindustrialisation would do well to remember the vast public subsidies still enjoyed by fossil fuel miners and exporters. This includes the billions in diesel fuel subsidies paid to domestic and foreign coal majors every year. The rebate is a top 20 budget expense that has cost Australians $127 billion since inception.

The key now, if we are to realise our green superpower ambitions, is speed and scale of investment, complemented by reforms to expedite the renewables rollout such as the green "go" zones announced recently. Appropriately pricing carbon is also critical to drive down emissions, via decarbonisation policy levers such as expanding the Safeguard Mechanism, and a move towards a carbon border adjustment mechanism.

With accelerated deployment of targeted strategic public and private investment, Australia has every opportunity to show international leadership and draw a line under the climate and energy inertia of the past. It’s time to stake our place in the global transition with an ambitious but achievable 2035 target of 75%.

The views expressed in this article may or may not reflect those of Pearls and Irritations.