Climate Policy Engagement Analysis
Climate Policy Engagement Overview: The Australian Aluminium Council (AAC) is highly engaged on climate policy. The association is broadly supportive of climate action in its top-line messaging but demonstrates a mix of positive and negative engagement with specific climate-related regulations. While the ACC supports Australia’s emissions reduction targets, it also calls for provisions that risk weakening the climate ambition of the country’s Safeguard Mechanism Reforms. In addition, the AAC advocates a continued role for fossil gas in the energy mix.
Top-line Messaging on Climate Policy: The AAC displays broadly positive top-line messaging on climate change. The association supported the goals of the Paris Agreement in its Climate Change Statement, accessed October 2023, and it also appeared to support Australia’s transition to net-zero emissions by 2050 in a joint statement published in October 2023.
However, the AAC’s position on the need for government regulation to respond to climate change is less clear. The association has repeatedly stated that it seeks a “national climate and energy policy framework which is equitable, transparent, stable and predictable”, as evident in a comment made by its chief executive Marghanita Johnson in the Australian Financial Review in February 2023. However, it has also consistently stressed the need for climate policy to maintain “the economic health of the nation”, suggesting the association supports a less ambitious approach to climate action.
Engagement with Climate-Related Regulations: The AAC engages with a mix of positive and negative positions on specific climate-related regulations. It supported Australia’s 2030 and 2050 greenhouse gas emissions targets in its Climate Change Statement, accessed October 2023.
However, the AAC called for a range of modifications to Australia’s Safeguard Mechanism Reforms, that risk undermining the climate ambition of the national policy for reducing emissions at the country’s largest industrial facilities in September 2022 and February 2023 consultation submissions. While the association issued support for declining baselines aligned with Australia’s emissions targets, it also advocated for a lower baseline decline rate of 3 percent in year one of the scheme, as opposed to the Government’s proposed 4.9 percent decline rate, called for the price cap on Australian Carbon Credit Units to be reduced and advocated for unlimited banking of Safeguard Mechanism Credits beyond 2030.
Positioning on Energy Transition: The AAC adopts largely negative positions on the transition of the energy mix. Although the association communicated support for specific regulatory measures to decarbonize the industry in a February 2023 consultation submission as well as for Australia’s transition to renewable energy supply in a November 2023 consultation submission, it also advocated a continued role for fossil gas “until at least 2050” in the November 2023 consultation submission. In addition, between 2021 and 2023, the AAC consistently raised concerns around the economic and technical feasibility of a transition away from fossil gas in the energy mix. In an August 2022 consultation submission, for example, the association stated that “ensuring adequate gas supply and competitive prices for gas will be essential to ensuring electricity reliability is maintained at least cost to consumers.” Similarly, in a June 2023 consultation submission, the AAC expressed its support for a continued role for fossil gas in the energy mix on the basis that it is a bridging fuel in lowering carbon emissions, without setting clear conditions related to carbon capture and storage or mitigating methane emissions.