A key component of adaptation is understanding the risks, Bowen continued. This is why the government embarked on its national climate risk assessment (NCRA), which identified 56 nationally significant climate risks facing Australia and 11 priority risks for analysis in the second pass risk assessment.

The risk assessment will be the foundation of Australia's climate response in the years to come, Bowen added. “We want this risk assessment work to be strong, well-constructed and incorporated properly into what we do going forward. It's not an easy task, it does take time, and we’re not rushing it. But we have it on a good time track."

Bowen also addressed the IGCC report Activating Private Capital for Climate Adaptation. Released in November, the research recognises the risk of capital flight from high physical risk areas and industries, and suggests avenues for the government and investors to enable investment in adaptation and resilience.

Bowen said climate-related capital flight is becoming an "ever closer risk", exacerbated by the possibility of greater levels of unpriced climate risk. However, he also said he is confident in the government and market's ability to increase resilience.

This process is well underway, he continued. Bowen said the NCRA’s first pass assessment, released in March, earmarked a major milestone in the process of determining risk across sectors, industries and asset classes, identifying "basically everything" at significant risk because of climate change.

The second pass assessment is underway and will deliver a deeper quantitative analysis of the top priority risks, Bowen continued. “You get a sense of the scale of work underway when you consider that we have now narrowed it down to 11 priorities… If you have 11 priorities, you have normally got too many – but it’s reflection of the size of the task," he said.

Part of this includes the risk of climate-related financial system shocks or volatility. “Financial markets do have to account for these risks,” he added. “This is why the Treasury’s work on climate risk disclosure is so important. Parallel work continues across government on sector plans and our net zero plan.”

Bowen also took the opportunity to highlight progress in Australian energy transition. He noted that September and October had the lowest penetration of coal in the grid and that Australia set a new record for its renewable energy generation, at nearly 75 per cent, on 30 October. Five years ago the record was 46 per cent.

Bowen said there are 45 gigawatts of projects in the process of being connected to the electricity grid. Eventually, offshore wind will add further capacity as well. “It’s clear we have an appetite for ongoing investment in new renewables in our country, and reforms like the CIS [Capacity Investment Scheme] have us well positioned to meet our emissions target for 2030 and land comfortably within the 10-year carbon budget we legislated alongside the Climate Change Act in 2022,” he revealed.

Having raised the level of ambition from “emissions reduction targets so low you could trip over it” under the previous government, Bowen said he takes comfort in the state and federal governments ability to work together. He also identified the Net Zero Economy Authority, corporate disclosure requirements and new vehicle efficiency standards as key signs of progress.

Likewise, he said the government’s sector plans will influence investment and innovation. Overall, Bowen believes recent reforms send a signal that will be important for maintaining momentum. “Setting clear investment priorities to allow private capital to do its work is the next step, and our sector plans will have this very much as their focus – as well as outlining the direction of travel for new government initiatives,” he commented.

However, Bowen is cautious of domestic political debate – particularly the coalition's nuclear scheme’s potential to chill investment in the infrastructure and industries crucial to the mitigation and adaptation agendas. “The Coalition's nuclear scheme is not about providing a serious solution to Australia's energy needs,” Bowen argued. “It is about purposefully creating uncertainty and perpetuating anti-renewables fearmongering to delay the transition.”

The role of gas in Australia’s transition energy mix remains a contentious subject. Most recently, the Australian Sustainable Finance Institute rejected pressure to include gas directly as either a green or transition activity in the local sustainable finance taxonomy. Bowen compared the role of gas to life insurance. “You hope its use is very limited but when you need it, you need it,” he said.

Australia’s 2030 renewables target is 82 per cent of supply. "[This] is not 100 per cent, there is 18 per cent left,” Bowen said. “As coal leaves the system, this means more gas. The ISP [AEMO's Integrated System Plan] says we need more gas capacity and less gas dispatched… While we’re making good progress on storage and transmission, even with that progress it's important to have backup."

He continued: “I don’t argue that gas is low emissions, but I do argue that it's zero emissions when it is turned off.”

Australia is bidding to host the COP31 in 2026. Bowen said he does not know when the host will be announced but he noted that Australia has strong support. The annual Conference of the Parties meeting is given to a new host country every year. Australia is up against Türkiye in its bid to hold the climate talks.

Bowen said he would not reveal the countries that have privately given support to Australia but confirmed that the US, New Zealand, Canada, Germany, France, the UK and Switzerland have all offered public backing to Australia’s bid.

The system is designed on consensus so the country with the least support is expected to withdraw. Bowen said he is in discussions with ministerial counterparts from Türkiye to resolve the negotiations “amicably”.

He added that Australia is keen to begin preparations as early as possible, and wants to avoid the situation of Azerbaijan – which is holding COP29 but only had 12 months to prepare once the final decision was made.

This is particularly relevant to the COP’s troika management model – which includes the COP president as the chief decision maker supported by the outgoing and incoming presidents. “Australia will take its place in the troika, or indeed Türkiye if [it wins] the bid. It’s important for Australia to take its place as soon as possible in the troika, because there’s a lot at stake over a couple of years,” Bowen said.