Climateworks experts on the key trends in climate action for 2026

Climateworks experts share the trends and opportunities that will define the year ahead, and what they mean for governments, industry and communities navigating the shift to a net zero economy.

Anna Malos, Australia Lead

For Australia, the year ahead is about building on momentum and aligning policy and finance with the new 2035 target. 

Policy reviews due to start this year offer multiple opportunities to ramp up implementation across sectors.

Australia is broadly on track to meet its deadline of 43 per cent emissions reduction by 2030, and the next milestone will be locking in policy to deliver the 62–70 per cent cut needed by 2035.

Each year progress builds. Take Australia’s electricity, for example: the majority of the nation’s electricity is now powered by renewables rather than fossil fuels. 

How governments build on this transformation is crucial to future-proofing the economy and lowering energy costs. 

Ensuring everyone receives the benefits of reaching net zero emissions is as important as the nuts and bolts of delivery. 

With cost-of-living challenges front of mind, 2026 is the year to show how reaching net zero is the single most important way to help everyday Australians and the economy. 

Alex Veale, System Lead – Industry 

In 2026, industrial decarbonisation can move from design to delivery. 

Targets are set, and some of the major policy architecture is in place. 

Now the challenge is in execution, and in how to translate ambition into projects that cut emissions at source while maintaining industrial competitiveness. 

A central test this year will be the Safeguard Mechanism review. 

This policy is at the heart of Australia’s industrial decarbonisation journey – it needs to genuinely drive at-source decarbonisation, rather than relying on offsets. 

It also needs to align with emerging policy priorities around electrification, industrial heat, energy demand management and the creation of markets for clean industrial outputs.

At the same time, state and federal governments will play an important role in guiding the future of major industrial assets facing transition. 

Decisions around interventions and transitions will shape regional economies for decades, and will determine whether Australia emerges as a low-carbon industrial leader.

Egi Giwangkara, Country Lead – Indonesia

This year in Indonesia, industrial decarbonisation and ocean-based solutions are front and centre.

As the country’s energy and industry emissions continue to increase, place-based industrial decarbonisation speeds up the shift to renewable energy and low-carbon technologies by bringing investments, benefits and risks into one shared location.

Climateworks’ place-based decarbonisation pathways are becoming increasingly important across four of Indonesia’s strategic industrial clusters: 

• Cilegon (iron & steel)
• Tuban (cement)
• Morowali (nickel)
• Halmahera (nickel & steel) 

To support a steady economic growth target of around 5 per cent this year, the government is also looking towards nature-based economies, and with a blue economy worth $1.3 trillion, this is one of the country’s most powerful levers for achieving net zero.

In 2026, the recognition of Indonesia’s massive potential for ocean-based mitigation within its latest nationally determined contribution submission, together with the blue carbon ecosystem roadmap, marks the country’s priority shift from potential to delivery.

This June, Indonesia will host the Ocean Impact Summit to accelerate ocean‑based climate solutions, catalyse the policy needed and unlock the full potential of the blue economy.

Climateworks will be advancing our blue pathway agenda, leveraging blue finance to unlock investment in ocean-based mitigation solutions.

It is important to build execution systems and tools that turn potential from mangrove, seagrass and coastal protection into bankable, policy-aligned climate action.

We can expect 2026 to unlock the connection between financial system rules and ocean outcomes through sustainable finance taxonomies, ocean accounting and data transparency.

Portia Odell, System Lead – Cities

This year brings pivotal decisions on the Fringe Benefits Tax for electric vehicles (EVs) and the mid‑year New Vehicle Efficiency Standard review. 

With record EV uptake in 2025, maintaining ambitious policies while investing in public and active transport can ensure Australians see the full benefits of the switch to clean energy. 

Household cost pressures remain high, but home energy efficiency and electrification can save up to $2,000 annually.

Implementation of key national policies like the Home Energy Ratings Disclosure can help to unlock more affordable and resilient homes. 

Keeping successful policies in place, and scaling those already delivering results, reduces household costs and strengthens community resilience. 

This is the moment to back the measures that drive cleaner, more affordable, healthier cities.

Phat Pumchawsaun, Southeast Asia Lead

In Southeast Asia, 2026 is about accelerating place‑based industrial decarbonisation, clean manufacturing, corporate transition, ocean‑based mitigation and a just energy transition – all against a backdrop of regional competitiveness, resilience and security.

Developments in steel, aluminium, cement and fertiliser production are on the agenda as the EU’s Carbon Border Adjustment Mechanism enters its definitive phase. 

Renewed momentum on energy transition under the Philippines’ ASEAN chairmanship is also expected. 

Progress on the ASEAN Power Grid (APG) will be particularly important.

The APG has and will continue to play an important role in strengthening transmission, dispatch, storage and system operations to unlock the region’s potential for higher renewable energy shares and deployment at scale.

Meanwhile, there are emerging opportunities linked to national and regional green taxonomies and carbon markets in Indonesia, Thailand, and Vietnam.

This year will also see large energy-intensive consumers in Vietnam implement Direct Power Purchase Agreements, creating access to cleaner power and supporting sectoral decarbonisation.

Turning momentum into meaningful progress

These are the priorities that will define 2026. We’ll share information, analysis and reports as each sector moves from planning to action. 

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