Australian investment for clean energy technologies could take a hit from the climate action shift in the US.
The Investor Group on Climate Change – which represents investors with managed funds of more than $US2 trillion ($A2.7 trillion) – has sent its members a policy brief on the US election and announcements in Asia.
US president-elect Joe Biden has a $US2 trillion ($A2.7 trillion) climate plan focused on clean energy investment and green jobs.
His administration will also re-enter the Paris Agreement and commit to net zero emissions by 2050.
“The sheer scale and size of the US economy means even small changes in direction can have global implications,” the brief says.
“Major investments by the US government and other major economies into existing and emerging clean technologies may create further challenges for investment in Australia, as capital flows to markets with supportive policy frameworks delivering better long term rates of return.”
The Morrison government is pinning its hopes on technology to reduce emissions, with the plan reliant on investment to reduce prices and make methods attractive.
China has committed to net zero by 2060 while the Morrison government hasn’t committed to a time goal for the emissions target.
The policy brief says net zero by 2050 is now the global benchmark, with Australia at risk of becoming increasingly isolated.