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Towards net zero: practical policies to reduce transport emissions

Carbon pricing Climate change Electric vehicles Carbon emissions Emissions reduction Motor vehicles Australia

Governments around the world are moving to ‘net zero’, to limit the impacts of climate change. All Australian state and territory governments have the goal of reaching net-zero carbon emissions by 2050 at the latest, and the Prime Minister says the national goal is net zero, preferably by 2050.

Yet Australia is not on track to hit this target. The best way to reduce emissions in every sector in an economically efficient way would be to introduce a single, economy-wide emissions price coupled with support for technology development and removing non-price barriers. But the political reality is that carbon pricing is out of reach, at least for now. So Australia should pursue sector-specific policies.

Australian governments can and should act now to create momentum towards the net-zero goal. This report, the first in a series on net zero, recommends policies for the transport sector, which was responsible for 18 per cent of Australia’s emissions in 2020.

Action today is crucial to avoid locking in emissions for decades to come, and to ensure the transport sector contributes to Australia reaching net zero by 2050. Governments have set the goal; this report identifies the practical, no-regrets policies they can adopt to steer Australia in the right direction.

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Grattan Institute Report No. 2021-07