The Nationals have set up a possible showdown with their political ally the Liberals after unanimously agreeing to scrap their commitment to net zero emissions by 2050.
The regional party argues Australia is doing more than its fair share to reduce carbon pollution, and emissions reductions should instead be tied to an average of similar countries within the OECD.
Leader David Littleproud said his party wasn't walking away from curbing greenhouse gas emissions or denying the existence of climate change.
"What we're saying is there's a better, cheaper, fairer way to address it," he told reporters in Canberra on Sunday.
The practical effect of the policy move would be to roughly halve Australia's annual emissions reductions.
MPs were briefed on a report from the Page Research Centre which makes dozens of recommendations, including allowing government subsidies for coal power stations and repealing Australia's Climate Change Act.
Littleproud said not all of the policy suggestions had been adopted and his colleagues had more work to do.
On Saturday, Nationals members attending the party's federal council voted to ditch net zero by 2050 from their official platform.
The move could leave Littleproud at odds with his colleagues in the Liberal party, who are still reviewing their climate and energy policies in the wake of their election defeat.
Asked what would happen if the Liberals kept their commitment to net zero, Littleproud said there were still a number of steps to play out.
"We're always keeping our door open but I'm respecting the sovereignty of the Liberal Party as they have respected ours," Littleproud told reporters.
Opposition environment spokeswoman Angie Bell said the Liberals had their own policy processes and wouldn't be beholden to the Nationals.
The regional party's decision to walk away from formal emissions targets is likely to anger some moderate Liberals who want to remain committed to net zero by 2050.
Asked if the decision to ditch the climate goal could cost the coalition votes in inner-city seats, Littleproud said the move would appeal to all voters because it would reduce energy bills.
"Much of those values and principles of regional Australians are the same as those that live in the leafy suburbs of Sydney and Melbourne, it's just that we don't have as much money in our wallet," he said.
Labor has criticised the move, saying any delay in reaching net zero would impose additional costs on the economy.
Speaking before the Nationals announced their final policy, Environment Minister Murray Watt said the issue was a test for the Liberal party.
"The idea that you would hand over climate and energy policy to the likes of Matt Canavan and the ghost of Barnaby Joyce is like handing Dracula the keys to the blood bank," he told the ABC's Insiders program.
Under the Paris Agreement, signed a decade ago, Australia and other member states must increase their emissions reduction targets every five years and cannot water them down.
The Labor government is committed to net zero by 2050 and is chasing an interim target of 62 per cent to 70 per cent emissions cuts by 2035.
