EY refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.
How EY can help
-
The EY Net Zero Centre brings together EY’s intellectual property, strategic insight, expertise and deep knowledge in energy and climate change leadership to solve the big problems ahead as we move towards net zero emissions by 2050.
Read more
Four keys for cost-effective action
The benefit–cost ratio of climate action has improved significantly in the last decade. Technology costs have fallen rapidly, while the benefits of avoided climate impacts are more immediate and material. As a result, the economic case for ambitious action is now stronger than ever.
The EY Net Zero Centre identifies eight practical ‘keys’ to lower costs, strengthen energy security and progress net zero ambition. These can deliver the lion’s share of emissions reductions to 2035 – while unlocking new value for industries and consumers:
1. Electrify buildings and assets as they reach end of life. Switching to electric systems powered by renewables delivers immediate long-term savings – estimated at more than $6,000 per household over a decade.
2. Expand electric vehicle (EV) uptake and transport efficiency. EVs offer total cost of ownership savings of up to $1,200 per year over conventional vehicles. For fleets, the opportunity is even greater. Realising these benefits requires charging infrastructure, electricity supply and upfront cost barriers to be addressed.
3. Improve the resilience and energy performance of homes and infrastructure. Future-ready buildings and settlements are safer, more comfortable and cheaper to run. For instance, a $2 billion investment in resilience could avoid $19 billion in future costs by 2050, while energy-efficient buildings can save households over $945 annually.
4. Scale land sector removals and high-integrity carbon credits. With the right frameworks, land-based carbon removal projects could generate $50 billion in national value by 2050 – while also helping to offset emissions from hard-to-abate sectors.
Four more keys to prepare for what’s next
The remaining four keys prepare the ground for a more dynamic and prosperous low-carbon economy beyond 2035:
5. Co-develop competitive low-carbon industries and technologies. Australia can lead in green iron, critical minerals, chemicals and data centres. A modest shift to export green iron (alongside iron ore), when combined with favourable policy and carbon credits, could lift national income by $89 billion by 2050.
6. Negotiate low-carbon growth strategies for agricultural exports. With limited abatement options, agricultural emissions could account for almost half of gross Australian emissions by 2050. Livestock exporters will need to rely on offsets, and pass the value of these on to consumers. Supporting informed consumer choice in destination markets will be essential.
7. Maintain incentives for reducing emissions in heavy industry and transport. Using Australian Carbon Credit Units halves costs to 2035 versus scenarios without carbon credits. More coverage and motivation are needed beyond current policy settings.
8. Provide a coherent long-term framework for fossil fuel exports. In 2024, 99% of Australian energy exports (and 94% of all goods exports) went to countries with net zero commitments. Aligning export policy with global decarbonisation goals – such as ensuring exports only go to countries with credible net zero targets – would help protect Australia’s long-term national interest.