LABOR’S NET ZERO INDUSTRY PLAN: NO COSTINGS AND ENERGY CHAOS

The Albanese Labor’s Government’s plan to rapidly decarbonise Australian manufacturing is not backed up by modelling and will see more energy system disruptions. 

In Senate Estimates, officials from the Department of Industry, Science and Resources conceded that no analysis had been undertaken into the financial impact to industry under Treasury’s Net Zero Baseline Scenario contained in the Industry Sector Plan.

Officials further conceded, “we [the Department] haven't specifically modelled or analysed the cost” to industry of incorporating abatement technologies, despite the deployment of such technologies playing a key role in Labor’s Net Zero transition. 

And in a further startling admission, officials confirmed that load-shedding would be more “likely” under the Baseline Scenario.

Shadow Minister for Industry and Innovation, Alex Hawke, said Labor had no credibility.

“Labor’s Net Zero industry plan is built on assumptions that are fatally flawed,” Mr Hawke said.

“The government is arrogantly demanding that Aussie manufacturers change their already under-pressure business models to fit in with a so-called plan that is devoid of detail on cost.

“At the same, it has been confirmed that Australians can expect more energy chaos because load-shedding will occur more often.

“You can’t deliver a ‘Future Made in Australia’, with lofty goals of being a critical minerals powerhouse, and have a part-time energy system."

ENDS

BACKGROUND

Relevant extracts of Senate Estimates transcript - Economics Legislation Committee, Friday, 10 October 2025 

Senator Jane Hume: I want to ask first about the Industry Sector Plan. Specifically, I want to look at page 14. It says that the Treasury modelling analysis serves as part of the evidence base for potential decarbonisation pathways for the industrial sector. It then says: The Treasury's Baseline Scenario illustrates a cost-effective pathway for the industrial sector to contribute to reaching Australia's net zero goal. Treasury's Baseline Scenario projects that emissions from Australia's industrial and waste sector will reduce from 61 Mt CO2-e in 2025 to 32 Mt CO2-e in 2050. Has the department done any modelling on the financial impact to industry of Treasury's baseline scenario?

DISR official: As part of our ongoing analysis of the net zero transition, we have been looking at the implications of that transition. In terms of an explicit financial impact of those particular declines, no.

…
 

Senator Jane Hume: Has there been any work done by the department around the cost to industry ofincorporating abatement technologies?

DISR official: We've done consultation and other research to understand where the technology is up to and how it might be used. … We haven't specifically modelled or analysed the cost, but we have looked at the role that abatement technology can play and where that technology is up to.
…

Senator Jane Hume: I asked you whether you thought load shedding would be more frequent. You said yes.
DISR official: Likely.

Labor’s Industry Sector Plan

  • On 18 September 2025, Minister Bowen unveiled Labor’s Net Zero Plan, which shows how Australia will transition to a “net zero economy by 20250.”
  • Alongside the Net Zero Plan and treasury modelling, Ministers Bowen and Ayres released the ‘Industry Sector Plan’, which outlines how the government expects industry to decarbonise.
     

Key extracts from the Plan

Page 4 (Ministerial Foreword) - This plan recognises the significant challenges Australian industry faces and will continue to face as it decarbonises. For some sectors, abatement technology either does not exist or is too expensive, and all industry is dealing with pressures on the cost of energy. Effective policy and joint effort between governments, industry and unions will be vital to ensuring we meet these challenges in the national interest.

Page 14 - In this section, we refer to the Baseline Scenario, in which Australia efficiently builds on existing climate policies and trends to achieve its net zero targets. The Treasury’s Baseline Scenario illustrates a cost-effective pathway for the industrial sector to contribute to reaching Australia’s net zero goal. Treasury’s Baseline Scenario projects that emissions from Australia’s industrial and waste sector will reduce from 61 Mt CO2-e in 2025 to 32 Mt CO2-e in 2050. Investments in abatement technologies are expected to be a significant driver for this emissions reduction. These technologies include electrification and adoption of less emissions-intensive production processes, which are projected to reduce emissions intensities across the sector by 72% by 2050.

Page 31 - Continued grid transition and increased share of variable renewables will need to be balanced with demand flexibility from all areas of the economy, including industry. Industry will need to consider options for reducing energy demand when demand and supply balance is tight (e.g. load-shedding), increasing industrial demand when there is excess renewable supply (e.g. load-taking) and providing other grid stability services to help deliver a cost effective system. This industrial demand flexibility is also discussed in the Electricity and Energy Sector Plan and can help optimise grid infrastructure, minimising the delivered cost of renewable electricity and supporting industries to remain competitive.