Pradeep Philip

The Australian government will soon decide on its 2035 emissions reduction target, with insiders reporting it will settle somewhere between a 65% and 75% reduction on 2005 levels.

New scenario analysis from Deloitte Access Economics, prepared for Future Group, shows how a weaker 65% target compared to a stronger 75% target would impact the economy.

75% is the economic opportunity we can’t afford to miss:

• A higher interim target and associated policy action could bring forward $20 billion of investment each year in the decade to 2035.
• 75% by 2035 offers Australia one of the single biggest boosts to future business investment.
• The 75% target brings forward investment in Australia’s transition, supporting an additional 45,000 jobs per year on average between 2025 and 2035 above the 65% by 2035 scenario.
• The higher climate target increases export opportunities to the tune of $190 billion for Australia.

Deloitte Access Economics Lead Partner Pradeep Philip says: “Compared to 65%, a 75% target means more jobs, more exports, and a stronger economy. Time and time again, our economic scenario modelling has concluded that strong targets, which can attract business investment, are good for the economy.

“Australia adopting a 75% by 2035 target offers greater economic opportunity and a lower cost to transition on the path to net zero by 2050.

“Achieving a 75% target can bring forward significant investment across the economy, unlocking a $227 billion economic opportunity, in today’s dollars, and 45,000 more jobs per year over the next 10 years compared to a 65% target.”

“This modelling shows that achieving a 75% target sets Australia up for a least cost transition to net zero – growing new industries, supporting jobs and transitioning our economic base onto new growth paths.”

Future Group backs 75%

Superannuation provider Future Group – the parent company of Future Super, Verve Super, GuildSuper, Child Care Super and smartMonday – is backing a 2035 emissions reduction target of at least 75%.

Over 350 businesses have joined Future Group’s campaign including Fortescue, Atlassian, Canva, Unilever, Volvo Group Australia, Culture Amp, Bank Australia, Intrepid Travel and Ben & Jerry’s.

These companies have signed the Business for 75 open letter^[1] calling for the government to commit to at least a 75% target.

Future Group Chief Executive Simon Sheikh says: “We’ve joined with businesses from across Australia including Fortescue, Atlassian, IKEA, Canva, Unilever, Volvo Group and more than 400 others to urge the Australian government to back a credible 75% emissions reduction target as economic modelling shows this will support business investment, innovation and growth.

“Australia is in a race to secure the global capital required to establish new green industries. Modelling completed by Deloitte Access Economics shows that a target of 75% can unlock more than $370 billion in additional economic growth for our country over the next 10 years. This is the equivalent of more than $10,000 per person.

“As the world decarbonises, Australia holds a winning hand: we have abundant land, affordable renewable energy, critical minerals, and a skilled workforce. With these strengths, we can build a future powered by clean energy, advanced manufacturing, and secure, well-paid jobs in our regions. But ambition must come first.

“While some in parliament are trying to slow things down with climate denial, global partners are looking at Australia to see if we’re serious about emissions reductions. A strong 2035 target will send a clear signal to investors, and global markets, that Australia is open for business.”

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Notes:
[1] Business for 75 open letter

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