INTERVIEW | Jaynie Seal and Tim on Australia’s Carbon Challenge

Tim Buckley, Director of Climate Energy Finance, discussed the growing momentum around carbon pricing in Australia and the need for broader regional collaboration, particularly with countries like China, Japan, South Korea, and Singapore. While carbon pricing has long been controversial in Australia, recent progress has been made through the safeguard mechanism, which now mandates annual emissions reductions of 4.9% for the country’s largest 219 industrial facilities. Buckley notes that domestic efforts are important—such as achieving 82% renewables by 2030—but stresses that emissions don’t stop at national borders. Australia’s exported emissions are estimated to be three to four times greater than its domestic ones, making it crucial to address carbon pricing in international trade. He points to the European Union’s Carbon Border Adjustment Mechanism as a model that Asia could adapt to create a more level playing field and support low-emission industries.

Tim also emphasises that without a carbon price in international trade, Australia can’t attract the private investment needed to build a competitive low-emissions economy. While the federal government has shown intent through its “Future Made in Australia” policy, relying solely on taxpayer subsidies isn’t viable. Regional carbon pricing cooperation would be key to mobilising capital and scaling up green export industries like green iron. As Australia eyes leadership at COP31, Tim argues that meaningful climate ambition—particularly in addressing Scope 3 emissions from exports—is essential. Hosting COP31 could be a powerful platform to show Pacific and Asian neighbours that Australia is serious about climate leadership. Finally, Tim points out that while Australia is rich in resources, better trade deals and international collaboration—particularly with China, which buys 85% of Australian iron ore—are needed to capture more economic and environmental value from those exports.