Look, no taxes! Labor’s modest target assumes 82 pct renewables and 89 pct EVs by 2030

Australian political discourse on climate is having a hard time keeping up with technology change.

Remember the targets that Labor brought to the 2019 election? The 50 per cent renewables target and the 50 per cent share of new car sales for EVs by 2030? Both were labelled economy wrecking.

But technology has moved on and Labor – behind its decision to present a “modest” 43 per cent cut in emissions by the end of the decade – has assumed a radical switch to green in the grid and on our roads.

Labor’s new Powering Australia Plan, revealed on Friday, banks on not just an 82 per cent market share for renewables by 2030, it also assumes that electric vehicles will make up 89 per cent of new car sales by the end of the decade.

And all this with no new taxes.

The proposal to take a reduced 43 per cent emissions reduction target for 2030 to the next election was endorsed on Friday morning by the federal Labor caucus.

Leader Anthony Albanese concedes that it is a “modest” target, but Labor seems intent on trying to blunt the inevitable scare campaign from the Morrison government.

To meet its target, Labor has adopted a ‘top down’ approach to its emissions reduction policies – rather than adopting an economy-wide policy like a carbon price or emissions trading scheme, Labor will adopt discrete policies designed to deliver the additional emissions cuts needed to bridge the gap between its target and what will be achieved through “business as usual” actions.

By 2030, Labor says its plan will drive $76 billion of investment, create around 64,000 new jobs and lower average annual electricity costs by $378.

Labor’s top down approach to emissions reduction under its new plan.

The plan includes getting the market share of renewable electricity up to 82 per cent by 2030, strengthening the caps on industrial emitters imposed by the Coalition’s own Safeguard Mechanism and allocating $3 billion under a National Reconstruction Plan to support the production of green metals, hydrogen and lowering agricultural emissions.

It would also see the vast majority of new car sales being electric models by 2030.

Labor’s modelling suggests that reaching 82 per cent renewable electricity would be doable while also delivering lower electricity costs, with the average household expected to pay $275 less each year by 2025 and $378 less by 2030.

Labor’s climate spokesperson, Chris Bowen, and leader Anthony Albanese outlined the opposition party’s climate policy package on Friday – dubbed which it has dubbed the “Powering Australia Plan“.

“What we have done here, and we are announcing today is good policy consistent with zero by 2050,” Albanese said.

“What we didn’t do was adopt a target and then work back. What we did was work through what other good policy mechanisms that will see a growth in jobs, a reduction in emissions, growth in renewables and a reduction in power prices for households and businesses, and then see where that came up through the modelling.”

“I expect the government to lie about this policy. As a pattern, a behaviour with this Prime Minister. He has made public comments on it without seeing it. That alone looking at the modelling, we have made sure that we have got this right,” Albanese added.

Labor has produced modelling of its new climate policy package prepared by consultancy Reputex, which Albanese described as “the most comprehensive modelling ever done for any policy by any opposition in Australia’s history since Federation.”

The Reputex modelling suggests that Labor’s policies would drive a significant jump in the uptake of electric vehicles. Labor has committed to cutting federal taxes on electric vehicle sales and investing in the rollout of new charging infrastructure.

It proposes to exempt EVs, including battery electric, plug-in hybrid electric, and hydrogen fuel cells, below the luxury car tax threshold for fuel efficient vehicles from fringe benefits tax, where EVs are provided through employment arrangements, and remove the import tariff.

The modelling says this could drive EV sales to around 89 per cent of new car sales and making up 15 per cent of all vehicles on the road by 2030.

The plan includes Labor’s previously announced $20 billion ‘Rewiring the Nation’ plan to invest in new electricity network infrastructure and incentives for electric vehicles and community batteries.

In a new measure, Albanese said that Labor would move to strengthen the emissions caps imposed on industrial emitters under the Safeguard Mechanism – a policy first implemented under the Abbott government – saying it will direct the Clean Energy Regulator to gradually tighten the caps on emitters, achieving an aggregate reduction of 213 million tonnes by 2030.

Labor says that it expects these stronger caps will drive investment in carbon farming projects that will generate offsets that industrial emitters can use to reduce their emissions under the Safeguard Mechanism.

Labor will also allow emitters that achieve additional reductions, under their caps, to trade the additional abatement. It is the adoption of a policy already being developed by the Morrison government and effectively allows the Safeguard Mechanism to operate like a ‘baseline-and-credit’ emissions trading scheme.

The party’s modelling suggests that 40 million tonnes of annual abatement will be driven through the carbon farming industry and expects to generate additional co-benefits.

“The development of a long-term source of demand for Australian carbon offsets will provide significant regional benefits beyond greenhouse gas emissions abatement, including investment and job creation, along with co-benefits to biodiversity, landscape production and water quality,” the modelling report says.

The heavy lifting for emissions reductions will continue to be done by the electricity sector, as it has done for much of the last decade, but Labor says its plan will also support the creation of an additional 20,460 direct jobs in the electricity sector.

The party’s modelling suggests Labor’s $20 billion ‘Rewiring the Nation’ plan will help unlock 26GW of new renewable energy capacity by 2030, cutting emissions by a further 180 million tonnes without accelerating the closure of coal or gas generators.

Addressing some of the barriers some households face in adopting solar – such as those renting or living in apartment buildings – Labor says it will commit $100 million to establish 85 “shared solar banks” across Australia, supporting community ownership of solar farms.

Bowen said Labor would formally adopt the 43 per cent target at international climate talks, committing to communicating the target at COP27 in Egypt next year if elected. Bowen added that Labor would re-establish the role of the Climate Change Authority and would deliver annual reviews of its policies to parliament.

Labor has also committed to reducing the Australian Public Service’s own emissions to net zero by 2030.

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