Government playing catch up with net zero

The Government’s net zero plan shows it is just catching up, says Fidelity portfolio manager, Kate Howitt, as all states already have net zero targets.

Speaking at a Fidelity webinar announcing its plan to halve emissions from its investment portfolio by 2030, Howitt said the 2021 United Nations Climate Change Conference had a positive impact on pressuring the Government to announce its net zero plan.

“On the other hand, I would argue it's actually not that big of a deal, because to some extent, it's the Federal Government catching up,” Howitt said.

“The states have already got net zero by 2050 targets and most of them have pretty good targets for 2030 as well.”

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Howitt said almost 90% of the emissions coming out of ASX 200 companies were already covered by net zero by 2050 targets.

She said the Government’s plan could be characterised as more carrots than sticks as it focused on investments over things like taxes.

“We haven’t seen any new taxes. We haven’t seen a carbon tax. We haven’t seen a carbon pollution reduction scheme as we had in the past,” Howitt said.

She said the plan could lead to more action taken at the government level to help companies move faster toward net zero, such as tweaks to tax and fuel excise tax rules.

“But again… companies are going to keep moving. They're going to keep looking globally and seeing what the direction of travel [is],” she said.

“I don’t think it’s a coincidence that you’re seeing the largest miners moving towards electrifying their operations because that futureproofs them for whatever happens with the price of diesel and the tax on diesel in the future.

“So I think that it is great that the federal government is finally coming to the party and doing its bit but I think [for] everyone now, the direction of travel is clear and we're going to keep moving.”