Productivity Commission Interim Report—Investing in cheaper, cleaner energy and the transition to net zero
Submission Date: 23 September 2025
The Law Council of Australia provided a submission to the Productivity Commission on its Interim Report into investing in cheaper, cleaner energy and the net zero transformation (Interim Report).1 This submission is informed by input from the Law Council’s Australian Environment Planning Law Group (AEPLG) and Climate Change Working Group, as well as the Law Society of New South Wales, and the Law Institute of Victoria.
The Law Council supports the Interim Report’s identification of emissions reduction as an important national priority.2 Consistent with its Climate Change Policy,3 the Law Council observes that the following principles should guide the development of federal and national law and policy responding to climate change:
- Australia’s international law obligations with respect to climate change, including under the Paris Agreement,4 should be fully implemented, domestically;5
- Australia’s response to climate change should give effect to rule of law principles, including that new laws should promote certainty, clarity and transparent outcomes;6 and
- Australia’s response to climate change should be fair and equitable and promote public confidence.7
Accordingly, Australia’s regulatory response to climate change, including through the net zero transformation, must offer long-term solutions with higher levels of ambition and predictability. This is necessary to comply with its international obligations; to enable government agencies and businesses across all sectors of Australia’s economy to best manage the physical, economic and other transition risks posed by the changing climate; and to empower business and civil society to make decisions within a decarbonising economy.
Mitigation and adaptation measures adopted by Australia should be environmentally effective, economically efficient, and provide transparent reporting, including on the effectiveness of specific measures. They should also identify and address the needs of marginalised communities and groups which are most vulnerable to the physical and transition risks of climate change, and be informed by the knowledge and leadership of diverse communities—in particular, of First Nations communities as the original custodians of the land, by reference to principles of self-determination and free, prior and informed consent (FPIC).
Australia’s national energy policy must also be determined and managed based upon the best available scientific evidence about its likely impact on the environment and Australia’s performance of its international obligations. The Law Council agrees with other inquiry participants that environmental standards cannot be compromised to meet clean energy goals.8
Against this context, this submission addresses specific draft recommendations from the Interim Report, in particular, draft recommendations 1.2, 2.1, 2.2, 2.3, 2.4, 3.1, 3.2 and 3.3.
1 Productivity Commission, Australian Government, Investing in cheaper, cleaner energy and the net zero transformation (Interim Report, August 2025) <https://www.pc.gov.au/inquiries/current/net-zero/interim/net-zero-interim.pdf>.
2 Ibid 1.
3 Law Council of Australia, Climate Change Policy (Policy Statement, 27 November 2021) <https://lawcouncil.au/publicassets/4cc8f2e4-375d-ec11-9445-005056be13b5/2021%2011%2027%20-%20P%20-%20Climate%20Change%20Policy.pdf>.
4 Paris Agreement, opened for signature 22 April 2016 [2016] ATS 4 (entered into force 4 November 2016) (Paris Agreement). Australia ratified the Paris Agreement on 10 November 2016.
5 Climate Change Policy 10 [46]-[47].
6 Ibid 10-11 [48]-[50].
7 Ibid 11 [51]-[52].
8 Interim Report 38.
Last Updated on 30/09/2025
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