Fresh economic modelling from Deloitte Access Economics suggests that Australia would be financially better off with a stronger 2035 climate target.
The study, prepared for Future Group, compared different emissions reduction scenarios and found that cutting emissions by 75% on 2005 levels by 2035 would add $370 billion to GDP compared with current projections. It would also support about 69,000 additional jobs each year between 2025 and 2035.
The government is due to set its 2035 emissions reduction target later this year, with the Climate Change Authority recommending a range between 65% and 75%. Deloitte’s figures show that the upper end of that range would deliver greater economic returns. Compared with a 65% reduction, a 75% target would unlock $20 billion more investment each year to 2035 and deliver $190 billion more in exports by 2050.
“Australia is in a race to secure the global capital required to establish green industries. Setting a lower target today comes at the cost of lower business investment than would otherwise be the case,” Deloitte Access Economics Lead Partner Pradeep Philip said.
More than 350 companies—including Fortescue, Atlassian, Canva, IKEA, and Unilever—have backed an open letter urging the government to adopt a 75% cut. The letter, coordinated by Future Group and Fortescue, argues that business confidence depends on setting clear and ambitious targets.
Future Group Chief Executive Simon Sheikh explains.
“As the world decarbonises, Australia holds a winning hand: abundant land, affordable renewable energy, critical minerals, and a skilled workforce. With these strengths, we can build a future made in Australia—powered by clean energy, advanced manufacturing, and secure, well-paid jobs in our regions. But ambition must come first.”
Fortescue Metals and Operations Chief Executive Dino Otranto added that Deloitte’s modelling showed clear economic advantages.
“The modelling shows that achieving a 75 per cent target could unlock an additional $370 billion in GDP by 2035 – a per capita GDP increase of over $10,000 – compared to a business as usual approach.”
Business support is not the only pressure on government. Climate experts argue that higher ambition also reduces environmental and economic risks from worsening climate change. The Climate Council has said stronger targets will help protect communities from more frequent extreme weather while creating new opportunities in renewable industries.
Deloitte’s report concludes that the choice of target is not only about cutting pollution but also about the structure of Australia’s future economy.
