As Australia prepares to vote in the 2025 federal election, energy policy will be top of mind for many voters. Whether led by Labor or the Coalition, the direction of Australia’s energy policy will have a profound impact on investment certainty, household energy costs, and the nation’s ability to meet its climate commitments. Our energy experts take a look at the competing energy agendas of the two major parties, and what their policies could mean for Australia’s energy landscape in the years ahead.
Election background
Labor’s 2022 victory ended the Coalition’s nine-year term in government, with Labor securing 77 lower house seats, forming a slim majority, and no party achieving a majority in the Senate.[1] This context is key to understanding the backdrop of the 2025 election. Labor’s slim majority has left it in a precarious position, further complicating efforts to deliver on its energy policy agenda.
With polls indicating a potential hung parliament, the challenge of balancing competing demands is likely to grow. Throughout its first term, the Albanese Government has faced resistance from both ends of the political spectrum: the Coalition has opposed its “renewables-first” approach, while the Greens have pushed for more aggressive climate action. These tensions are expected to sharpen as the energy transition becomes even more central to the national conversation in 2025 and beyond.
Labor’s key energy policies
Continuation of current policies
Labor’s energy policies aim to achieve 82% renewable energy capacity and a 43% emissions reduction by 2030.[2] The balance of Australia’s energy generation capacity will be met by firming resources such as hydrogen, batteries, and gas.[3] To support these goals, Labor has committed to continuing funding for key initiatives from its first term, including the National Reconstruction Fund, and providing regulatory support for renewable energy projects. This funding commitment underscores Labor’s pledge to a renewables-first future and bolsters market confidence for the energy transition.
In addition, Labor continues to support the Rewiring the Nation Fund (RNF) which focuses the construction and maintenance of transmission infrastructure to facilitate the viability of large-scale energy projects and their connection to consumers.[4]
Labor has also taken direct ownership and financing of the Snowy Hydro 2.0 project and has pledged to maintain public ownership for the balance of its term.[5] These renewable energy policies are complemented by the Australian Domestic Gas Security Mechanism which allows for greater flexibility in responding to gas supply shortfalls, and the Future Gas Strategy (2024) which provides a roadmap for emission reductions through 2050.[6]
Both policies have faced criticism lacking full implementation and specific legislation to meet net-zero targets. However, they reflect Labor’s commitment to balancing renewable energy with gas to address potential supply gaps. These policies have faced opposition from the Coalition including the RNF and the 82% renewables goal.[7]
Household batteries investment
Labor has pledged $2.3 billion to support the adoption of household batteries through the Cheaper Home Batteries Program (the Program). This initiative seeks to capitalise on the growing popularity of dispatched renewable energy resources, such as solar panels, which have seen a significant rise in household installations since 2018, with one in three homes now equipped with rooftop solar.[8]
Recognising a gap between solar and battery adoption as a barrier to achieving net-zero, Labor aims to address the issue of solar panels being ineffective at night or on overcast days without a battery. The Program aims to reduce the upfront costs of home battery installation by 30%, targeting the primary barrier to residential adoption – cost.[9]
It is forecast that over one million new batteries will be installed by 2030, facilitating the simultaneous uptake of solar PV and battery storage systems. This will enable households to gain greater independence from the grid and help reduce energy costs.
Expansion of the Clean Energy Finance Corporation
The Clean Energy Finance Corporation (CEFC) was established under the Gillard Government in 2012 to drive financial investment in the clean energy sector and help Australia meet its greenhouse gas emission reduction targets.[10]
Labor has pledged to recapitalise the CEFC with a $2 billion expansion to unlock additional investment in renewable energy and low emissions technology.[11] The investment will also include $36.9 million for optimising existing grid infrastructure and a $10 million Accelerated Connections Fund to fast-track the connection of renewable energy generation and storage technologies into the grid.[12]
Often referred to Australia’s ‘Green Bank’, the CEFC has played a vital role in funding renewable energy projects, transcending political divides. This growth underscores the financial foundation of Labor’s energy transition goals and aims to secure ongoing public and private investment for the future.
Energy bill relief
Labor has not met its 2022 election promise to reduce household energy prices. Instead, Labor has provided consumers with temporary rebates to help offset rising power bills and ease cost of living pressures, at a cost of approximately $3.5 billion.[13] Labor has now committed to extending these energy rebates until the end of 2025 for all households and select small businesses, with an additional $150 in rebates to be automatically applied to residential electricity bills in quarterly instalments.[14] The Coalition has not confirmed it will support the rebates, arguing they fall short of addressing long-term challenges but that they will “not stand in the way” of energy relief.[15]
Coalition’s key energy policies
Introducing the Civil Nuclear Programme
The Coalition has made nuclear energy central to its 2025 Federal Election energy policy,[16] proposing to lift the existing moratorium and establish a civil nuclear program.[17]
The plan includes developing two nuclear projects by the mid-2030s using either small modular reactors or large-scale plants.[18] These plants would be federally owned and built in partnership with international nuclear companies.
Seven potential sites have been identified, including Liddell, Mount Piper, and Loy Yang, selected for their existing transmission infrastructure, access to cooling water, and skilled workforces.[19] The Coalition argues that nuclear energy would complement renewables and gas by providing clean, reliable 24/7 baseload power, helping to reduce power prices, enhance energy security, and achieve net-zero emissions by 2050.
The proposal also includes the creation of new regulatory bodies, such as an expanded Australian Radiation Protection and Nuclear Safety Agency and a new government entity, Affordable Energy Australia. Labor opposes nuclear energy.[20]
Fossil fuel continuation
The Coalition has made the continuation and expansion of Australia’s fossil fuel industries, particularly gas, a key focus of its economic and energy strategy.[21]
Its National Gas Plan aims to prioritise domestic supply through an East Coast Gas Reservation Scheme, decouple domestic prices from international markets, and invest in critical pipeline and storage infrastructure.[22]
The plan also seeks to reduce regulatory barriers by halving approval timelines, streamlining offshore gas project approvals, defunding activist groups such as the Environmental Defenders Office, and enforcing ‘use it or lose it’ conditions on gas licences.[23]
Additionally, the Coalition proposes reinstating the $300 million Strategic Basin Plan and establishing a $1 billion Critical Gas Infrastructure Fund to accelerate fossil fuel investment.[24] Frontier Economics modelling, cited by the Coalition, estimates that these measures would reduce wholesale gas prices by about 23%, with further reductions for manufacturing and households.[25]
In contrast, Labor’s approach focuses on strengthening regulatory frameworks without expanding supply.[26] The Coalition frames its approach as critical for lowering energy costs, strengthening Australia’s industrial base, and securing national sovereignty.[27]
RETs and transmission infrastructure
Coalition policy documents estimate Labor’s plan would require 58 million solar panels, 3,500 wind turbines, and 28,000 km of new transmission lines.[28] Frontier Economics modelling estimates the total cost of Labor’s energy plan could range from $1.2 trillion to $1.5 trillion.[29]
The Coalition’s approach focuses on nuclear energy at existing coal plant sites, minimising the need for new transmission infrastructure. [30] They argue this will lower system costs, protect regional landscapes, and reduce electricity prices. [31]
The Coalition plans to scrap Labor’s Rewiring the Nation Fund and prioritise investment in a balanced mix of renewables, gas, and nuclear energy. [32] However, implementing this would require overcoming significant legislative barriers, as nuclear power is currently prohibited under both federal and state laws. [33]
Repealing the Environment Protection and Biodiversity Conservation Act 1999 and state bans would be essential to establish a civil nuclear program. Until nuclear facilities can be developed, Australia would continue relying on existing coal and gas generation.
If successful, the Coalition’s plan could shift Australia’s generation mix to include more renewables, gas, and zero-emissions nuclear, with a reduced need for large-scale transmission projects.
Comparison of agendas
| Labor policies | Coalition policies |
| Continued funding for current policies
Supporting the CIS, NRF, RNF and emissions reduction commitments. |
Civil Nuclear Programme
Lifting the ban on nuclear technologies and developing Government-owned reactors. |
| Household batteries fund
A $2.3 billion investment to support residential uptake of batteries. |
Fossil fuel continuation
Plans to expand gas projects and reduce regulatory hurdles for fossil fuel developments. |
| Financing the CEFC
A $2 billion recapitalisation of the CEFC. |
RETs and transmission infrastructure
Shifting the priority to a 2050 goal. |
| Areas of bi-partisan support | |
| Shoring of domestic gas capacity
Both parties have advocated, and announced policy platforms, for the expansion of the domestic gas industry as a mechanism of either bridging the gap for renewables, in case of Labor, or providing the transitionary capacity needed for nuclear adoption under the Coalition. |
|
| Energy rebates
The Coalition has claimed they will not stand in the way of Labor should they maintain their majority; however, it is unclear if they will continue the extension if they form Government in their own right. |
|
| Net zero by 2050
Both parties have affirmed broad support for the Paris Agreement and its imposition of net zero emissions by 2050. However, it is unknown how the Coalition, who intend to abandon Labor’s commitment to a 43% reduction in emissions by 2030, will practically achieve this goal. |
|
What next?
The 2025 federal election presents voters with a stark choice on energy policy.
Labor’s approach centres on enabling the energy transition by supporting market-led investment in renewables, infrastructure, and affordability measures, while maintaining a regulatory framework to guide emissions reduction.
In contrast, the Coalition proposes a more interventionist strategy, marked by direct government involvement in nuclear energy development, fossil fuel expansion, and regulatory overhaul.
Where Labor aims to accelerate change by facilitating private-sector momentum, the Coalition seeks to reshape the energy landscape through state-led projects and policy disruption. The outcome of the election will help determine whether Australia’s energy future is steered by market dynamics or by a reassertion of government control.
[1] AEC, ‘2022 federal election’, 17 August 2022, <https://www.aec.gov.au/Elections/Federal_Elections/2022/index.htm>.
[2] Australian Government, ‘Net Zero’, January 2025, <https://www.dcceew.gov.au/climate-change/emissions-reduction/net-zero>.
[3] Ibid.
[4] Australian Government, ‘Rewiring the Nation’, February 2025, <https://www.dcceew.gov.au/energy/renewable/rewiring-the-nation>
[5] Snowy Hydro, ‘Our Company-Snowy Hydro’, January 2025, <https://www.snowyhydro.com.au/about/our-company/#:~:text=The%20Commonwealth%20Government%20is%20the,it%20receives%20an%20annual%20dividend.>.
[6] Australian Government, ‘Future Gas Strategy’, June 2024, <https://www.industry.gov.au/publications/future-gas-strategy>.
[7] The Conversation, ‘The Coalition prepares to soften Australia’s 2030 climate target, while reaffirming its commitment to the Paris Agreement’, April 2025, <https://theconversation.com/the-coalition-prepares-to-soften-australias-2030-climate-target-while-reaffirming-its-commitment-to-the-paris-agreement-249945>.
[8] Australian Government, ‘Australia Hits Rooftop Solar Milestone’, November 2024, <https://www.energy.gov.au/news/australia-hits-rooftop-solar-milestone>.
[9] Ibid.
[10] Australian Government, ‘Clean Energy Finance Corporation’, March 2024, <https://www.finance.gov.au/government/specialist-investment-vehicles/clean-energy-finance-corporation#:~:text=The%20CEFC%20was%20established%20to,indirectly%2C%20in%20clean%20energy%20technologies.>.
[11] Prime Minister’s Office, ‘Albanese Government builds Australia’s future with new investment in Clean Energy Finance Corporation’, January 2025, <https://www.pm.gov.au/media/albanese-government-builds-australias-future-new-investment-clean-energy-finance-corporation>.
[12] Ibid.
[13] Nine News, ‘Every household to get $300 off energy bills in bumper $3.5 billion budget package’, May 2024, <https://www.9news.com.au/national/federal-budget-2024-energy-bill-relief-3-5-billion-package-300-dollars-every-household/84ec2343-ab65-498a-b5a6-da0326a96005>.
[14] Australian Labor Party, ‘More energy bill relief for every Australian household and for small business’, March 2025, <https://alp.org.au/news/more-energy-bill-relief-for-every-australian-household-and-for-small-business/>.
[15] ABC News, ‘Labor promises to shave $150 off energy bills in fresh election pledge’, March 2025, <https://www.abc.net.au/news/2025-03-22/labor-promises-to-shave-150-off-energy-bills/105084994>.
[16] Peter Dutton, The Priorities of a Dutton Coalition Government (Policy Document, April 2025) 14-15.
[17] Liberal Party of Australia, Our Plan for Zero-Emissions Nuclear as part of a cheaper, cleaner and consistent energy future (Policy Document, 2025) 2–6.
[18] Ibid.
[19] Ibid.
[20] Adam Morton, ‘“Bordering on Incredible”: Coalition Under Fire for Planning to Scrap Labor Climate Policies and Offering None of Its Own’, The Guardian (online, 20 April 2025) https://www.theguardian.com/australia-news/2025/apr/20/bordering-on-incredible-coalition-under-fire-for-planning-to-scrap-labor-climate-policies-and-offering-none-of-its-own.
[21] Liberal Party of Australia, Our Plan to Deliver Australian Gas for Australians (Policy Document, 2025) 2–7.
[22] Ibid.
[23] Peter Dutton, Budget in Reply Speech (Speech, 27 March 2025).
[24] Ibid.
[25] Frontier Economics, Assessment of Coalition Gas Policy Proposals (Report, April 2025) 12.
[26] Australian Labor Party, Protecting Our Climate (Web Page, 2025) https://alp.org.au/protecting-our-climate/.
[27] Liberal Party of Australia, Our Plan to Deliver Australian Gas for Australians (Policy Document, 2025) 2–7.
[28] Liberal Party of Australia, A Cheaper, Cleaner, and More Consistent Energy Plan for Australia (Media Release, 13 December 2024) 2–4.
[29] Assessment of Coalition Gas Policy Proposals (n 25).
[30] A Cheaper, Cleaner, and More Consistent Energy Plan for Australia (n 28).
[31] Ibid).
[32] Protecting Our Climate (n 26).
[33] Environment Protection and Biodiversity Conservation Act 1999 (Cth) s 140A.
