Australia’s 2030 climate target is comparable in ambition to the US, Canada, Japan, South Korea and the EU. But additional policy measures will be required to meet Australia’s target.
Sydney, 11 August 2015
The Australian government’s proposed emissions reduction target of 26-28% below 2005 levels by 2030 is in line with the pledges made by other OECD nations, including the US, Canada, Japan, South Korea and the EU, analysis by global research firm Bloomberg New Energy Finance shows. However, the commitments made to date are not sufficient to limit global average temperatures to two degrees above pre-industrial levels.
Australia’s unconditional 26% emissions pledge is:
- Less ambitious than the EU and US, but more ambitious than Canada, South Korea and Japan when assessed against a common 2010 baseline year.
- Less ambitious than China, South Korea and Canada, but more ambitious than the EU, US and Japan when assessed on an emissions intensity per unit of GDP basis.
- Less ambitious than South Korea, Mexico, Canada and the US, but more ambitious than Japan and the EU when assessed relative to Bloomberg New Energy Finance’s projection of each economy’s business as usual trajectory.
- Equivalent to a 19% reduction on 2000 levels, the baseline used to assess the short-term target of a 5% reduction in 2020.
Comparing the ambition of emissions reduction pledges is difficult, as each country has its own historical emissions profiles and current economic components informing its energy mix and intensity. At the same time, countries express emissions reduction targets in different ways, often to maximise the appearance of national effort. Bloomberg New Energy Finance’s assessment of emissions reduction ambition therefore measures national efforts in three dimensions: trajectory, intensity, and abatement required to meet targets. These three measures are compared in detail below.
Australia’s pledge is comparable to the US, Canada, Japan and South Korea in most dimensions. “This shows that the Australian government has judged the politics and nominated a headline target that is right in the middle of the pack with its trading partners”, said Kobad Bhavnagri, the head of Australia for Bloomberg New Energy Finance. “However Australia, like most countries, is still not doing enough to keep the projected rise in global temperature below 2 degrees”.
Meeting Australia’s target of 26-28% below 2005 levels by 2030 will require additional policy. “Australia’s pledge requires the country to reduce emissions by 7%, relative to where the economy is likely to head with our current suite of policies”, Bhavnagri said. Bloomberg New Energy Finance’s analysis predicts that Australia’s emissions will fall by 11% by 2030 relative to 2005 levels without any further policy measures. “A stronger, longer-term and more robust set of policies will be required to meet this target”, Bhavnagri said. “At present, Australia’s Renewable Energy Target only supports an increase in clean capacity out to 2020, and it’s doubtful whether the Direct Action policy can get Australia to its 2020 goal, let alone the more challenging 2030 pledge.”
BNEF’s analysis shows that carbon emissions will remain stubbornly high unless generation from coal-fired power stations reduces. “The long life of our existing coal-fired generators means that with current policies, power sector emission fall by only 9% by 2030 compared to 2014”, Bhavnagri said. “We have to face up to the reality that if we want to reduce emissions domestically, Australia has to institute policies that reduce coal-fired power and boost renewables”, Bhavnagri said. “If that doesn’t occur, Australia will have to consider a mechanism to purchase emissions reduction permits from other nations.”
Parties ranked by target emissions trajectory
|Party||Absolute target emissions trajectory relative to 2010|
|EU||-32% by 2030|
|US||-22% by 2025|
|Australia||-22% by 2030|
|Canada||-21% by 2030|
|South Korea||-21% by 2030|
|Japan||-16% by 2030|
|Mexico||+7% by 2030|
|China||+58% by 2030|
|Russia||+60% by 2030|
|Global benchmark||-21% by 2030 (consistent with 50% reduction in emissions over 2010-50)|
Parties ranked by target emissions intensity
|Party||Required change in emissions intensity consistent with INDC|
|China||-54% by 2030|
|South Korea||-53% by 2030|
|Canada||-51% by 2030|
|Australia||-50% by 2030|
|EU||-48% by 2030|
|US||-43% by 2025|
|Japan||-29% by 2030|
|Mexico||-28% by 2030|
|Russia||+12% by 2030|
|Global benchmark||-49% by 2030 (consistent with 50% reduction in emissions over 2010-50)|
Parties ranked by abatement needed to hit target vs BNEF emissions estimate
|Party||Required change in emissions compared with BAU over 2012-30|
|South Korea||-28% by 2030|
|Mexico||-21% by 2030|
|Canada||-11% by 2030|
|US||-8% by 2025|
|Australia||-7% by 2030|
|Japan||-3% by 2030|
|EU||+5% by 2030|
|China||+9% by 2030|
|Russia||+53% by 2030|
|Global benchmark||Not available|
Bloomberg New Energy Finance
+61 9777 1293
ABOUT BLOOMBERG NEW ENERGY FINANCE
Bloomberg New Energy Finance (BNEF) provides unique analysis, tools and data for decision makers driving change in the energy system. With unrivalled depth and breadth, we help clients stay on top of developments across the energy spectrum from our comprehensive web-based platform. BNEF has 200 staff based in London, New York, Beijing, Cape Town, Hong Kong, Munich, New Delhi, San Francisco, São Paulo, Singapore, Sydney, Tokyo, Washington D.C., and Zurich.
BNEF products fit your daily workflow, streamline your research, sharpen your strategy and keep you informed. BNEF’s sectoral products provide financial, economic and policy analysis, as well as news and the world’s most comprehensive database of assets, investments, companies and equipment in the clean energy space. BNEF’s regional products provide a comprehensive view on the transformation of the energy system by region.
New Energy Finance Limited was acquired by Bloomberg L.P. in December 2009, and its services and products are now owned and distributed by Bloomberg Finance L.P., except that Bloomberg L.P. and its subsidiaries (BLP) distribute these products in Argentina, Bermuda, China, India, Japan, and Korea. For more information on Bloomberg New Energy Finance: http://about.bnef.com, or contact us at firstname.lastname@example.org for more information on our services.
Bloomberg, the global business and financial information and news leader, gives influential decision makers a critical edge by connecting them to a dynamic network of information, people and ideas. The company’s strength – delivering data, news and analytics through innovative technology, quickly and accurately – is at the core of the Bloomberg Professional service, which provides real time financial information to more than 319,000 subscribers globally. Bloomberg’s enterprise solutions build on the company’s core strength, leveraging technology to allow customers to access, integrate, distribute and manage data and information across organizations more efficiently and effectively. Through Bloomberg Government, Bloomberg New Energy Finance and Bloomberg BNA, the company provides data, news and analytics to decision makers in industries beyond finance. And Bloomberg News, delivered through the Bloomberg Professional service, television, radio, mobile, the Internet and three magazines, Bloomberg Businessweek, Bloomberg Markets and Bloomberg Pursuits, covers the world with more than 2,400 news and multimedia professionals at more than 150 bureaus in 73 countries. Headquartered in New York, Bloomberg employs more than 15,500 people in 192 locations around the world. For more information visit www.Bloomberg.com/now/