Australia's dirtiest industries can transition to net zero and create more than one million jobs if polluters, government and investors work together.
But it's going to cost roughly $20.8 billion per year and require action that goes beyond current policy if Australia is to help limit global warming to 1.5 degrees, according to a report released on Monday.
Industry and government need to spend around two thirds of this investment on Australia's energy system and one third on electrification of the most heavily polluting operations, energy efficiency and new technology.
The crucial supply chains are iron and steel, aluminium, other critical metals and minerals, chemicals and liquefied natural gas - representing around 25 per cent of industrial emissions and employing nearly half a million people.
But over 1.3 million jobs could be created between 2025 and 2050 with co-ordinated investment by government, industry and investors, according to the industry decarbonisation pathways report.
The report prepared by independent organisation Climateworks and CSIRO follows three years of work with some of the nation's biggest companies as part of the Australian Industry Energy Transitions Initiative.
The Initiative's chair, Monash University Chancellor Simon McKeon, said industry greenhouse gas emissions could be reduced up to 92 per cent by 2050, with high-quality offsets for the last slice of hard-to-abate emissions.
"Action is needed now to lay the foundations, capitalise on the opportunities and avoid more costly emissions reduction measures in the future," he said.
Climate Change and Energy Minister Chris Bowen launched the industry report with Lord Adair Turner, who has been an advisor to the project.
"Australia's economic future in a net-zero world is hugely positive and prosperous," Lord Turner said.
"Blessed with abundant natural wind and solar resources it can both decarbonise its own economy rapidly and become a major exporter of green hydrogen to countries across the world."
Among the report's recommendations are clean industrial regions, supply chains and new energy networks.
Australian Renewable Energy Agency CEO Darren Miller said electricity generation would need to double by 2050 and the industry blueprint shows how it can be done.
Meanwhile, key crossbencher David Pocock is considering proposed changes to a safeguard mechanism designed to cut industrial emissions.
With the coalition vowing to oppose deeper cuts, the Albanese government needs the support of the Greens and two other crossbenchers to pass the linchpin of federal climate plans.
The Greens have made their support conditional on a ban on new coal and gas projects.
According to Greenpeace Australia Pacific, the energy transition report backed by Woodside Energy, Rio Tinto, BHP and other industry heavy-hitters makes the case for no new gas as its use will decline.
Woodside climate spokesman Tony Cudmore said the recommendations for co-ordinated action from government, industry and finance deserve careful consideration.
Innes Willox, CEO of Ai Group, said the redesign of the safeguard mechanism would not be complete until there was a long-term measure to avert carbon leakage, where operations shift offshore under looser emissions regimes.
