Australia has issued AUD4.6bn (USD3.2bn) worth of green bonds so far this year, on pace to exceed last year’s AUD6bn (USD4.1bn) total issuance, as reported by Bloomberg on August 20. According to Susan Barron, global head of sustainable capital markets at Barclays [BCS:US], Australia’s sustainable debt industry gained momentum since May’s federal election, where the pro-environment Australian Greens secured record votes and the new government led by the Australian Labor Party (ALP) committed to a 43% emissions reduction in 2030 compared to 2005 levels. Moreover, on August 3, the ALP proposed a bill to codify its 43% emissions reduction target into law after the Greens pledged support, bringing pressure on large emitters to invest in emissions reduction.

The ALP hopes to put an end to the ten-year-long battle over climate policy between Australian politicians by passing the bill, as worsening bushfires and floods ravage the country and fuel concerns over climate change. Nevertheless, given that coal and gas still account for 75% and 16% of Australia’s electricity generation, the 43% emissions reduction target would require a drastic change in carbon emission rules and a great investment in accelerating the green transition. Last year, the Australian government committed at least AUD20bn (USD13.8bn) to low emissions technologies over the next decade, hoping to unlock AUD80bn (USD55.3bn) of private and public investment in green technologies and pave way for its 2050 net-zero emissions target.

Sources:

https://www.bloomberg.com/news/articles/2022-08-20/climate-action-to-spur-australian-green-bonds-to-record-year?srnd=green#xj4y7vzkg

https://www.cnbc.com/2022/05/24/australias-election-was-all-about-climate-change-heres-what-it-means-for-businesses.html

https://www.minister.industry.gov.au/ministers/taylor/media-releases/australias-plan-reach-our-net-zero-target-2050

https://www.reuters.com/business/sustainable-business/australias-greens-back-climate-law-vow-fight-coal-gas-projects-2022-08-03/