Why Trump will force Labor to delay 2035 climate target, and the Dutton challenge that follows

The Albanese government will delay its 2035 emissions reduction target beyond the federal election as Donald Trump’s stance on the issue forces the Climate Change Authority to delay its call on Australia’s ambitions.

Delays to Australia’s climate agenda would create a challenge for the Albanese government before the federal election, as it mounts a campaign against the Opposition Leader Peter Dutton’s nuclear plan with warnings it would extend the life of coal plants and raise greenhouse emissions.

Donald Trump’s positions on climate change are likely to have a global impact.Credit: Michael Howard

Matt Kean, a former NSW Liberal government treasurer and now chairman of the Commonwealth’s independent Climate Change Authority (CCA), revealed exclusively to this masthead that the incoming US president had forced the agency to delay its report by months.

“The election of Donald Trump, his statements on climate change and positions on energy policy are likely to have a global impact,” Kean said.

“It’s necessary to reassess and recalculate the assumptions that will inform the Climate Change Authority’s advice to the government on Australia’s Nationally Determined Contribution.

“Due to this extra work, we will require more time to deliver the target’s advice. We expect to be able to deliver this work in several months’ time.”

Climate Change Authority chairman Matt Kean (left) and Climate Change Minister Chris Bowen.Credit: Alex Ellinghausen

Under the rules of the Paris Agreement on climate change, member nations must set increasingly ambitious emissions reduction targets every five years, and the deadline for Australia’s 2035 contribution is February.

However, Climate Change Minister Chris Bowen cannot set his target until he considers advice from the CCA, and the election is due by May.

Australia is banking on nascent technologies such as green hydrogen for its 2035 Nationally Determined Contribution – the official term under the Paris Agreement for a country’s climate target.

“We’ll do further work and modelling that will take into account America’s new approach to climate change mitigation, the rest of the world’s response, and their impacts on global supply chains,” Kean said.

The US became the first nation to formally withdraw from the Paris Agreement during the first Trump presidency. President Joe Biden signed an executive order to rejoin it on his first day in office in 2021.

Trump declared climate change a hoax in interviews and speeches in 2022 and has pledged to scrap the Inflation Reduction Act (IRA), Biden’s signature climate policy, after he returns to office on January 20, 2025.

Trump has given short shrift to calls for urgent climate action.Credit: AP

The outgoing Biden administration announced on Thursday a target for the US to cut emissions by between 61 and 66 per cent by 2035, but Trump will scrap it.

Currently, the IRA has $567 billion of financial assistance on offer for research and development and was set to play a major role in developing green hydrogen and commercialising technologies to help electrify industries that currently depend on fossil fuels.

Green hydrogen – which is made using renewable energy to ensure it is emissions-free – is considered a promising fuel to curb planet-warming emissions due to its ability to displace coal, gas and oil in parts of the economy that are difficult to decarbonise, such as manufacturing and heavy transport.

But green hydrogen remains prohibitively expensive to make and is not yet viable at scale.

Kean said other countries were also likely to delay their 2035 targets as they come to grips with the potential impacts of a Trump administration. “I met with the climate delegations of over 15 countries, including some of our closest trading partners, it was clear that they were all grappling with the same issues and that most would not be delivering their targets too previous timelines,” he said.

Climate action ‘off-track’

The Albanese government is under pressure to deliver on its current commitments amid warnings it is already off-track.

Of the 124 projects that have applied for approval under national environmental laws, just 28 have reached a final decision – either approved or rejected – according to the Clean Energy Investor Group, which represents major energy investors such as Macquarie, Neoen and BlackRock.

Boosting renewables to 82 per cent of the grid by the end of the decade is a major goal, but this is challenged by hold-ups in project approvals due to onerous environmental assessments for major projects.

“There are a number of short-term fixes to the environmental assessment process the federal government could make that will unlock further renewable investments and bring international investors more confidence and predictability in entering this market,” said CEIG chief executive Richie Merzian.

However, Australia could attract more green investments if Trump scraps the IRA, as global capital already committed to the energy transition finds new homes outside the US.

Johns Hopkins University think tank, the Net Zero Industrial Policy Lab, said a US retreat on clean energy policy could open up an $80 billion opportunity for international markets.

“This is the time for Australia to lead in embracing the clean energy transition,” Merzian said.

Countries are expected to announce their targets before the next United Nations climate summit in the Brazilian city of Belem in November next year.

Australia will face pressure from the UK to set an ambitious goal after Keir Starmer’s Labour government committed to cut emissions by 81 per cent by 2035.

Australia’s 2030 climate target, to cut emissions from 2005 levels by 43 per cent by 2030, is viewed as a relatively modest aim as it does not comply with the objective of the Paris Agreement for nations to commit to action consistent with limiting global warming to under 2 degrees.

Australia’s Climate Change Authority is currently considering responses to a draft target it issued in April to reduce emissions by 65 to 75 per cent by 2035.

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