This report analyses various measures under consideration by the ACT Government to address climate change by reducing greenhouse gas emissions (mitigation) and preparing for the physical impacts of climate change (adaptation). Mitigation measures are assessed against the 2030 emission reduction target range for the ACT-recommended by the ACT Climate Change Council, which is 65-75% below 1990 levels.

In summary, the key findings of this report include:

- Modelling of emissions reduction measures indicate sufficient abatement to meet the 65 percent target at an average cost of $31.95 per tonne.

- Priority measures are those that address transport emissions through electrification, and replacement of gas equipment with electric equipment for space and water heating. These provide substantial volumes of abatement at reasonable cost.

- A key supporting measure is the maintenance of the ACT’s 100 percent renewable electricity supply, which enables electrification of transport and heating to achieve zero-emissions outcomes. Assessment of two different demand forecasts suggests it is uncertain as to whether the ACT will need to access additional renewable energy supply by 2030, but we find no additional cost to the ACT in covering the potential shortfall identified in our revised reference case, due to the trends toward equivalence of renewables prices and wholesale electricity prices in the National Electricity Market.

- Modelling suggests the 75 percent target will be significantly more challenging or costly to achieve, as it requires either additional, unmodelled measures, or a significant reliance on land-based sequestration outside the ACT. Depending on the degree of reliance on the land sector, the average cost could range from $8.40-126.00 per tonne.

- Abatement costs are important but should not be considered the sole criterion for measure selection. Some measures have low direct abatement costs but significant economic implications, and may, therefore, face challenges in translation to policy and implementation. For example, more stringent standards for building energy performance could have a number of flow-on impacts, depending on how they are implemented: on the cost of housing construction, which is a major economic driver, or on the location of housing construction, which could leak to neighbouring jurisdictions with lower standards.

- Conversely, some measures have high abatement costs but potentially significant co-benefits and adaptation benefits. Building retrofits, if targeted at particularly poorly performing homes and/or particularly vulnerable households, could produce significant benefits to residents via lower bills, improved comfort, health and heat stress prevention. Similarly, increasing urban canopy cover offers a limited amount of abatement at high cost – but also provides adaptation benefits through cooling, and other important co-benefits in terms of pollution reduction, increased biodiversity and higher amenity values.

-It is important to note that the costing of measures is based on currently available information. Many costs are likely to change significantly over time in response to changes in technology, markets, consumer behaviours and business models. Moreover, the modelling we have undertaken cannot capture all of the flow-on consequences, both positive and negative, of each measure.

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