Australia's 2035 Climate Target: Bold Enough?

Australia now has a new climate goal on the horizon: by 2035, our emissions should fall 62–70% below 2005 levels.

The Climate Change Authority (CCA), which advises government on these targets, calls it ambitious but achievable. On a per-person basis, it’s one of the steepest reductions in the world — equal to a 76–81% cut once population growth is factored in.

But the announcement has sparked debate. Is this the step forward we need, or are we holding back when we could do more?

A Target with Promise?

The CCA’s advice was unanimous. Chair Matt Kean summed it up neatly:

“This is our moment to be bold, to do what’s right for the environment and the economy for generations to come.”

The science is clear that cutting emissions this decade is essential, and the Authority believes Australia can grow its economy while doing it. Our natural advantages — sun, wind, and a wealth of critical minerals — mean the opportunities are huge.

Yet many in the climate community and the global media are asking if the target goes far enough. The Authority’s own experts had recommended a higher range of 65–75%, and global comparisons are not flattering. The UK, for example, is targeting a 78% cut by 2035. Independent analysts like Climate Action Tracker suggest 76% or more is needed for Australia to align with a 1.5 °C pathway.

So, while the target is a step forward, some argue it’s a cautious one given our wealth, capacity, and responsibility as a major fossil fuel exporter. Others argue the opposite - that we're aiming so high, we're putting a straight-jacket on our economy. 

Whether Australia is punching above its weight or falling short, the real question is what this means for businesses and for the renewables industry.

What it Means for Business

It’s easy to see climate targets as abstract, but for businesses the implications are very real. Here's how the new targets are likely to impact Australian businesses in the short-to-medium term.

• Reporting and regulation are tightening. Under Mandatory Reporting, large companies have already begun disclosing their emissions, climate risks, and transition plans as of this year. Targets like this put more weight behind those rules

• Investors are watching. Businesses with credible decarbonisation strategies will find it easier to access capital. Those without will stand out for the wrong reasons.

• Markets are shifting. Major trading partners are introducing carbon border taxes. If Australian exports are carbon-heavy, they’ll cost more to land overseas.

• Efficiency pays. Cutting emissions often means cutting waste. Energy efficiency, electrification, and renewables can lower costs and improve resilience at the same time.

As many Smart customers have told us, climate ambition is no longer just about reputation. It’s about competitiveness, cost control, and long-term survival.

“The 2035 target of 62 to 70 per cent is ambitious and achievable if we get the policy detail right. It will take effort across every sector of the economy, and one area with clear untapped potential is commercial and industrial rooftops. Putting more solar on those buildings can cut costs for business while helping the nation stay on track.”

Matt Kean, Chair, Climate Change Authority

What it Means for Clean Energy

For those of us working in the clean energy industry, this target is both a challenge and an opportunity.

Reaching even the lower end of the 62–70% cut means transformation on an unprecedented scale. According to the ABC, renewables will need to supply about 95% of Australia’s power by 2035. That requires quadrupling wind, tripling large-scale solar, doubling rooftop solar and batteries, and a six-fold increase in storage. On top of that, electric vehicles must increase twenty-fold and households will need to electrify kitchens, heating and transport.

The consequences of failure aren't pretty. If the rollout falters, power bills could end up 50% higher than the long-term average. If it succeeds, they could fall by around 10%. For businesses, that’s the difference between energy becoming a growing liability or a source of long-term certainty.

The upside? Every project built and every system improved strengthens Australia’s position as a clean energy leader. As the CCA noted, the tide of technological change and the capital to fund it is already flowing in Australia’s favour.

Climate Works Centre put it best: Australia could cut emissions by as much as 85% by 2035 if government and business “seize the moment.” In the commercial and industrial renewable energy space, we are ready. What businesses need now is to recognise that solar and storage are proven ways to cut Scope 2 emissions, and to choose partners with the expertise and staying power to deliver — partners like Smart.

Looking Forward

Whether you see this target as bold or conservative, there's no doubt that it's a milestone in Australia's climate commitment. It's also a sign that deep emissions cuts are no longer optional, they're what we need to tackle to achieve long-term prosperity.

For business leaders, it’s time to embed emissions reduction into strategy, not treat it as a side project. For the clean energy sector, it’s a call to scale up, innovate, and deliver solutions that make the next decade count.

In the end, the target is just a number. What really counts is whether we use it to get moving and make the most of the opportunity in front of us.