Media release: Investment in industrial decarbonisation welcome step towards net zero 11 January 2023
The Energy Efficiency Council today welcomed the commitment from the Albanese Government to invest $600 million into decarbonising emissions intensive trade exposed industries, as part of its proposed reforms to the Safeguard Mechanism.
Energy Efficiency Council CEO Luke Menzel said this is a smart investment. “We have entered a new era with two key features: high energy prices around the globe, and an ever increasing focus on cutting the emissions intensity of the products we use every day.”
“In this new landscape, working with our most emissions intensive industries to decarbonise as quickly as possible is the best way to secure their long-term competitiveness.”
Mr. Menzel said improving energy efficiency and pairing energy use with renewables are an crucial part of the decarbonisation effort. An independent, global scorecard released in April 2022 found that when it comes to industrial energy efficiency policy and performance, Australia is a long way behind competitor countries.
“Investing in improving the energy performance of our largest energy users is a no-brainer – it will reduce emissions, reduce exposure to volatile gas markets, and help transition Australian industry to a net zero future,” he said.
Mr. Menzel said the Government’s proposed reforms to the Safeguard Mechanism are also broadly on the right path, although further refinements are needed to ensure the scheme maintains its integrity.
“A well-designed and well-implemented Safeguard Mechanism reform package will send a clear signal to industry to invest in decarbonisation within Australia. Energy efficiency is one of a number of pathways with huge potential to help us reduce emissions quickly.”
Mr. Menzel said that the flexibility arrangements within the safeguard mechanism proposal are broadly appropriate, but quantitative and qualitative limits on the use of offsets is important to ensure companies invest in decarbonisation on their own sites.
Ongoing reforms to the Emissions Reduction Fund framework will also be required to bring a broader range of emissions-reducing activities into the offsets regime to create a diverse, resilient and high-quality marketplace for carbon credits.
“There’s still work to be done to unlock our lowest-cost source of emissions reduction”, Mr Menzel said.
“Improved energy performance will lower emissions and reduce energy bills, and the time is right to deploy it at scale.”
Alex St John, Acting Head of Policy
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