KELLY Australian climate policy is a disaster. Having said this, investors and issuers are getting on with the job. I would point to the progress of green bonds in Australia. We have banks that are willing to fund
and investors that are willing to back green bonds.

Another factor to consider is how Commonwealth government policy failure can be mitigated by state-government energy targets.

MOORE The federal government has agreed to certain targets within the Paris Agreement and as a country I think we’ll continue to collectively aim for these.

I agree with Tim Kelly that, in the absence of government actions, the states have not only taken this on but are delivering. We’re seeing this in South Australia and I think we will begin to see it in other states too.

BERRUTTI The political environment has been a big problem and we are all paying  more for energy than we should as a result. Climate and energy policy has lost at least a decade in Australia, and this has held back investment. We have, at different times, effectively seen an investment ‘strike’.

Having said this, it has been less directly relevant in our fixed-income business than it has in infrastructure, where we have renewable-energy assets but they are all located offshore! We would love to invest in renewables here in Australia and we have tried to do so, but lack of regulatory certainty is a concern.

The cost of renewables and other clean technologies is falling. Despite the regulatory gap, companies are engaging in things like direct power purchase agreements with renewable-energy producers. This has become a purely economic decision with renewables getting cheaper all the time.

This is a good thing, of course, but it’s not enough and introduces a range of risks to existing assets including to the networks.

To get the scale of investment needed to transition to a low-cost, resilient and lowcarbon energy system we need a policy framework that drives new investment. We also need to recognise this transition is happening globally with big implications for Australia.

WONG It is also a very real financial risk. There is a failure in public policy in taking advantage of the
falling cost of renewable energy and investing in new projects to ensure we remain competitive. More political certainty would certainly be welcome in this context.