In December, Governments meet in Paris to agree how to tackle climate change. The deal is expected to have far reaching implications, affecting energy, transport, industry, buildings and finance. It will change investment decisions made by companies and spending decisions made by consumers.
Australia will need to nearly double its historic rate of decarbonisation, to 4.4% annually, if it is to meet its goal of 26% decrease in carbon emissions on 2005 levels by 2030.
Our 7th annual Low Carbon Economy Index (LCEI) tracks the rate that G20 countries are decarbonising their economies by measuring decreases in their ‘carbon intensity,' or the ratio of carbon emissions relative to GDP growth. Breaking the link between growth and emissions is seen as essential in avoiding the worst impacts of climate change.
Three consistent themes have emerged from the Intended Nationally Determined Contributions (INDCs), that is, the publicly declared country commitments that will be taken to Paris:
Australia's energy mix will need to continue to evolve to keep Australia on track to meet its 2030 emissions target. Energy producers that rely on coal, gas, and oil will be very much part of the solution. The key for these businesses will be taking a portfolio view, and looking for opportunities to diversify into wind, hydro, solar, and emerging technologies.