A commitment to net-zero emissions by 2050 from Australia’s notoriously coal-friendly government would unlock A$63 billion in new investment over the next five years and open up carbon farming as a major new opportunity, according to new analysis commissioned by a group of institutional investors that deliberately looks beyond the even bigger opportunities in renewable energy.
The value of a commitment to an “orderly transition” to net-zero “would reach hundreds of billions of dollars by 2050 across sectors including renewable energy, manufacturing, carbon sequestration, and transport,” The Guardian reports, citing a release earlier this month from the Investor Group on Climate Change (IGCC), a collection of financiers from Australia and New Zealand with more than $2 trillion under management. “However, if the country keeps to its current targets and climate policies, investment worth $43 billion would be lost over the next five years, growing to $250 billion by 2050.”
The report, which the IGCC commissioned from Australian consultancy Energetics, identified opportunities worth $15 billion in manufacturing, $6 billion in transportation infrastructure, and $3 billion in green hydrogen through 2025, The Guardian says. “Carbon sequestration—or carbon farming—would emerge as a major investment asset class, with estimated investment worth $33 billion in nature-based solutions such as tree planting and assisted regeneration of deforested land.”
Investment potential through 2050 would include $385 billion in clean electricity, $350 billion in domestic green hydrogen, $104 billion in transportation infrastructure, and $102 billion in carbon sequestration.
“What it shows is that the investment opportunities extend well beyond just the renewables industry,” said IGCC Director of Policy Erwin Jackson. “Renewables are the backbone of the transition, but there are massive opportunities in other sectors such as manufacturing, restoring the land, and electrification of transport.”
With more than half of Australia’s direct trading partners already committed to net-zero by 2050, the report also looked at the pitfalls of continuing along the federal government’s current course. “Put bluntly, capital is global, and it wants to invest in climate change solutions because they see it as delivering more on their long-term investments,” Jackson said. “They’re going to invest more in countries that have durable, credible policies to achieve net-zero emissions by 2050.”
Energetics isn’t the only source of analysis—or daily news—pointing to the opportunities for Australia in the shift off fossil fuels. Another recent report found that the coal-dependent state of Queensland could generate nearly 10,000 jobs with a shift to renewables, and for just over an hour earlier this month, South Australia became the first major jurisdiction in the world to be powered 100% by solar-generated electricity. “This is truly a phenomenon in the global energy landscape,” said Australian Energy Market Operator (AEMO) CEO Audrey Zibelman.
Elsewhere, Western Australia is embracing its 26-gigawatt Asian Renewable Energy Hub as a job creator and a “major contributor” to greenhouse gas reductions.