This interim report is one of the five pillars of productivity inquiries setting out practical reforms to boost Australia’s productivity. An inquiry into Investing in cheaper, cleaner energy and the net zero transformation was tasked with identifying priority reforms and developing actionable recommendations. It finds consistent incentives and faster approvals are key to the net zero transformation.

Australia should address the gaps and overlaps in emissions reduction incentives, speed up approvals for clean energy infrastructure and create a resilience-rating system for all housing to meet Australia's clean energy targets and adapt to climate change.

The report presents 12 draft recommendations focused on 3 key policy reform areas:

1. Reducing the cost of meeting emissions targets
2. Speeding up approvals for new energy infrastructure
3. Addressing barriers to private investment in adaptation.

To achieve net zero at least cost, Australia needs consistent and comprehensive incentives to reduce emissions. Governments should fill policy gaps, remove overlaps and ensure incentives are neutral towards which technologies can achieve reductions, and in which states and territories. The cost-effectiveness of policies should be regularly assessed, and policy settings amended as needed to ensure they are consistent with an efficient emissions-reduction pathway. Priorities for action include:

• introducing enduring, broad-based market settings in the electricity sector to reduce emissions after 2030
• expanding the Safeguard Mechanism to include more industrial facilities
• new, technology-neutral policy settings to incentivise reductions in emissions from heavy vehicles.

Feedback and further information is invited from individuals, businesses and organisations. Submissions close Monday 15 September 2025.