In the first of what will be annual climate change statements, Mr Bowen said emissions reduction projections had increased in the six months since the Albanese government came into office.

Emissions are projected to drop by 40 per cent by 2030.

While the government has adopted an emissions reduction target of 43 per cent by the end of the decade, Mr Bowen said the current estimate was already well above that of the former coalition government.

"The previous government left their projected emissions reductions by 2030 at only 30 per cent," he told parliament on Thursday.

"We've lifted the outlook by a third in just our first six moths. Policies we received a mandate for, and are working on implementing, will lift our result to at least 43 per cent."

The statement on climate change delivered each year to parliament was part of the government's recent legislation on emissions reduction, which locked in the 43 per cent target and net-zero emissions by 2050.

Advice from the Climate Change Authority said the country would need a decarbonisation rate of at least 17 million tonnes per year, or an increase of 40 per cent, to meet climate targets.

Mr Bowen said it was imperative to act on reducing emission levels even further, given the levels of natural disasters experienced.

"Australia is highly vulnerable to the impacts of climate change, including bushfires and floods, so the stakes are extremely high," he said.

"Not acting would be an unforgivable act of intergenerational negligence."

The statement follows federal budget predictions electricity prices would rise by more than 50 per cent in the next two years, while gas would rise by more than 40 per cent.

Mr Bowen said he would discuss a capacity investment mechanism with state and territory counterparts in coming weeks in a bid to reduce power prices.

"Renewable energy alone won't meet our emission reduction targets. We need a whole of economy response," he said.

"Industrial emitters are projected to overtake electricity generators as Australia's leading source of emissions."

Mr Bowen also used the speech to urge a greater take up from the business sector in meeting the challenge of emissions reduction.

"While the technology exists to meet our 2030 targets, there are significant labour market and supply chain challenges, as every country around the world strives to meet their targets," he said.

"Business as usual can't be the usual business anymore. Businesses must step up and deliver on their commitments during this critical decade for climate action."

The statement comes a day after Mr Bowen introduced to parliament laws to reward industrial facilities that stay below their emissions baselines and give other facilities a new way of reducing net emissions.

The Safeguard Mechanism (Crediting) Amendment Bill 2022 will enable large industrial facilities to earn credits when they reduce their emissions below their baselines.

About 215 facilities that produce more than 100,000 tonnes of greenhouse gases a year are included in the safeguard mechanism and accounted for 28 per cent of Australia's total emissions in 2020/21.

Australian Associated Press