The federal government has given a strong indication it intends to sign up to a net zero emissions commitment, with Treasurer Josh Frydenberg making the economic case in a speech to business leaders on Friday, warning “Australia has a lot at stake”.
Mr Frydenberg said if Australia did not appear to be “transitioning in line with the rest of the world,” it would face reduced access to capital markets.
“Reduced access to these capital markets would increase borrowing costs – impacting everything from interest rates on home loans and small business loans to the financial viability of large infrastructure projects,” Mr Frydenberg said.
Several Liberal MPs have been vocal about their support for a more ambitious climate target, including Jason Falinski, Dave Sharma, Trent Zimmerman and Warren Entsch, however, Mr Frydenberg will be the most senior cabinet minister to publicly endorse the goal.
The Liberal Party has long faced opposition from the National Party on adopting a more aggressive climate goal, with Nationals such as Senator Matt Canavan remaining opposed to a net-zero emissions plan.
Nationals’ leader Barnaby Joyce said on Friday, he had “no problems with any plan that does not leave regional areas hurt”.
Prime Minister Scott Morrison has been meeting with President Joe Biden in the US, where climate change was a major topic of discussion – with Mr Morrison telling reporters after a one-on-one meeting with the President, the two countries were “both seeking to get to the same place”.
However, Mr Morrison remained firm that Australia had not yet made a commitment to net zero, saying Australia “has not made any final decision on that matter.
He noted Australia was working on a plan that recognised “the world is transitioning to a new energy economy, in order to respond to climate change.”