Can the Albanese government strike the right balance: set a climate policy that's strong enough to work, but isn't branded reckless?

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The Australian government faces a critical decision in setting an ambitious 2035 emissions target, a move that must balance strong climate action with economic realism. The Climate Change Authority has advised a reduction of 65-75% below 2005 levels, a highly ambitious goal that would require halving Australia's current emissions. While this target is technologically possible and economically desirable for long-term success, the government must walk a political tightrope between environmental groups pushing for the high end of the range and business concerns over cost.

Achieving any target over 60% will require deep, rapid emissions cuts across the entire economy, backed by stronger policies and business investment. Key challenges include a slow clean energy transition hampered by regulatory gridlock, a Safeguard Mechanism for industry that currently provides insufficient incentive, and a land sector where very little is being done. The government must deploy a suite of tools, potentially guided by a high implied carbon price, as a nationwide carbon tax remains politically unviable.

Ultimately, this is a crossroads for Australia's climate future. Success hinges on the government's decisiveness and follow-through with policies that modernise the energy grid, reform the industry, and revolutionise transport and land use. If done well, a strong target can spur investment and economic modernisation; if handled poorly, a historic opportunity for a lasting legacy on climate action will be squandered.