Australia faces a grim future if climate action stalls. The nation’s inaugural National Climate Risk Assessment paints a sobering picture of the challenges ahead.
Released in September 2025, this comprehensive evaluation exposes the brutal reality confronting every Australian community. No region will escape the mounting dangers of extreme weather, rising seas, and escalating temperatures.
The assessment delivers a stark warning: property losses could reach $770 billion by 2090 without urgent intervention.
Economic Devastation on an Unprecedented Scale
The financial implications are staggering. Worker productivity alone faces a $203-642 billion hit by 2063 as extreme heat forces mass shutdowns across industries.
Exposure to heat would harm worker productivity, reducing overall economic output by $135-423 billion by 2063. This conservative estimate doesn’t capture the full scope of economic disruption ahead.
Australia’s mining sector, already grappling with decarbonisation challenges, faces additional pressure from climate-induced operational disruptions. These events, driven by climate change, have already cost over $1.8 billion, excluding uninsured losses.
The insurance crisis looms large. Over 750,000 properties could become uninsurable by 2050 – an increase of 170,000 from 1990 levels. At 3°C warming, nearly one in ten households would face complete insurance exclusion.
Three Scenarios, Three Futures
The National Climate Risk Assessment Report 2025 examines three temperature scenarios that will shape the continent’s destiny.
Projected change in winter cropping growing season (April to October) rainfall calculated from the baseline period (2001-2020).
- At 1.5°C warming, Australia already experiences significant disruption. Current extreme weather events represent what could become the new normal without decisive action.
- The 2°C scenario brings intensified devastation. Forests in the southeast of Australia – an area heavily impacted by Black Summer – would see a 47% increase in extreme fire weather. Heatwaves would multiply, fire seasons would extend, and rainfall patterns would shift dramatically.
- The 3°C pathway offers the bleakest outlook. At 3°C, the consequences are dire: twice as many catastrophic fire weather days and regular 50°C temperatures in cities like Sydney and Melbourne.
Coastal Communities Face Mounting Threats
Coastal Australia bears the brunt of rising seas and intensifying storms. If populations remained static, then that puts 597,000 people at direct risk of coastal hazards by 2030.
By 2090, three million Australians could face high or very high coastal flooding risks. A sea level rise of one-metre would put 160,000 to 250,000 properties at risk of coastal flooding
Queensland, New South Wales, and Tasmania emerge as the most vulnerable states. Remote communities face doubled freight costs as supply chains buckle under climate pressure.
Areas at risk under different warming scenarios.
Health Impacts Escalate Across the Nation
The human toll grows exponentially with each degree of warming. Sydney would face a 444% increase in heat-related deaths and Darwin a 423% increase.
Heat stress affects more than individual health. Dangerously hot weather would force farmers, miners and construction workers to down tools for 700,000 additional days every year by 2061.
Healthcare systems face overwhelming pressure as extreme weather events coincide with temperature-related illnesses. Regional medical supply chains could see transport costs double as infrastructure struggles with climate impacts.
Mining Industry Confronts Twin Challenges
Australia’s critical minerals sector faces competing pressures. The energy transition demands increased mineral extraction while climate risks threaten operational continuity.
Underground mining operations particularly struggle with extreme heat. Equipment failures, worker safety concerns, and supply chain disruptions compound traditional mining challenges.
The assessment highlights how climate change exacerbates existing sustainability issues across Australian mining operations. Water scarcity, extreme weather, and regulatory pressure create a complex operational environment.
Systems Under Stress
The National Climate Risk Assessment identifies eleven priority risks across seven critical systems:
- Health and social support – Overwhelmed during concurrent extreme events
- Infrastructure and built environment – Critical failures during heatwaves and floods
- Natural environment – Ecosystem collapse threatening 70% of native species
- Economy, trade and finance – Market volatility and reduced productivity
- Food and fibre – Agricultural disruption and supply chain breakdown
- Water – Scarcity and quality degradation
- Defence and national security – Resource conflicts and regional instability
Climate change will disrupt our very way of life. “Changes in Australia’s climate will not occur gradually or smoothly. Reaching potential climate and ecological tipping points is very likely to result in abrupt changes”
Regional Disparities Emerge
Northern Australia faces disproportionate risks from tropical cyclones, extreme heat, and flooding. Remote communities already struggle with limited telecommunications and weak supply chains.
Aboriginal and Torres Strait Islander communities experience the harshest impacts. Displacement from Country threatens cultural connections, family structures, and traditional land management practices.
Urban centres aren’t immune. Northern Australia, remote communities and outer suburbs are particularly susceptible, which it said will place a strain on health and wellbeing, emergency services, critical infrastructure and primary industries.
A Call for Urgent Action
The assessment arrives as Australia prepares its 2035 climate target. The timing isn’t coincidental – these projections should inform policy decisions that will shape the nation’s trajectory.
The only solution is to rapidly slash climate pollution from coal, oil and gas, and replace energy sources with clean alternatives. Half-measures won’t suffice given the scale of risks identified.
Investment priorities must shift dramatically. The cost of extreme climate events topped $30 billion annually in 2021. Prevention costs far less than emergency response and reconstruction.
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Building Resilience Now
The National Climate Risk Assessment Australia 2025 serves dual purposes. It quantifies risks while providing frameworks for adaptation planning.
Government responses include the National Adaptation Plan, which coordinates action across sectors. However, success depends on immediate implementation rather than continued delay.
Businesses face mounting pressure to climate-proof operations. ASX-listed resources companies increasingly factor climate risks into investment decisions and operational planning.
The path forward demands unprecedented cooperation between government, industry, and communities. Climate risks transcend traditional boundaries, requiring system-wide responses.
The assessment makes clear that every year of delay amplifies future costs. Australia stands at a crossroads where today’s choices determine tomorrow’s habitability.
Without rapid emissions reductions and comprehensive adaptation measures, the $770 billion price tag represents just the beginning of a much larger economic and social catastrophe.
The National Climate Risk Assessment Australia 2025 doesn’t just describe possible futures – it demands Australia choose which future it will accept.
