Australia's 62 to 70 Per Cent 2035 Target Is Credible Only if the Grid Is Built on Time
On 18 September 2025 Prime Minister Anthony Albanese, Treasurer Jim Chalmers and Climate Change and Energy Minister Chris Bowen announced that Australia would set its 2035 emissions target at a reduction of 62 to 70 per cent from 2005 levels. The government accepted the independent advice of the Climate Change Authority, which described the range as ambitious but achievable. Alongside the target, it released a Net Zero Plan with six sector plans, Treasury economic modelling and the Authority's advice, and announced new spending, including a AUD 5 billion Net Zero Fund within the National Reconstruction Fund, AUD 2 billion more for the Clean Energy Finance Corporation and AUD 1.1 billion to encourage domestic production of clean fuels.
The target will be submitted as Australia's nationally determined contribution under the Paris Agreement. According to the government, most of the reductions needed to reach the lower end of the range can come from five areas: clean electricity, electrification and efficiency, clean fuels, new technologies and carbon removals on land. Electricity is the largest single source of Australia's emissions and the sector where the cheapest abatement is available. The Australian Energy Market Operator's Integrated System Plan sets out the transmission projects needed to connect new renewable zones and move power between states.
Without transmission, new wind and solar farms cannot connect, and the coal plants they are meant to replace cannot retire safely. One practical response is to make better use of the grid that exists. A system dominated by wind and solar needs firming capacity for periods when both are low. Gas will therefore continue to play a role as a back-up fuel, which creates an uncomfortable tension for a major gas exporter. The AUD 5 billion Net Zero Fund and the clean fuels support are aimed at these sectors. The opposition Coalition has moved away from supporting net zero, and the target will be a point of contest at future elections.