Economic analysis for the proposed Climate Change Response (Zero Carbon) Amendment Bill
The economic analysis for the proposed Climate Change Response (Zero Carbon) Amendment Bill which preceded the Act.
The economics analysis was broad, considered upsides and challenges and no one report or impact figure can be read alone. The findings are indicative as any modelling to 2050 is highly uncertain. The target does not determine how the transition to a sustainable low emissions economy will be managed; rather, the government will control the pace and shape of the transition.
Overall, the analysis found there could be substantial upsides to transitioning: for innovation, wider health and environmental benefits and by avoiding the damage created by a changing climate if the rest of the world also acts.
The quantitative modelling tells us about the impacts of specific pathways to meet targets that were considered.
The modelling results are highly sensitive to assumptions on innovation and forestry and don’t include the upsides.
The economy can continue to grow and meet the new target at prices that are moderate by international standards, if we support innovation and afforestation.
Some emitting sectors could decline or change and new sectors will emerge. Household impacts may not be substantial initially and the Government is committed to managing a just transition.
For a summary of the complete analysis see Appendix 3 of the Regulatory Impact Statement: Zero Carbon Bill