This study examines the impact of renewable energy rebates, specifically premium feed-in tariffs (FiTs) and renewable energy target (RET) policies, on environmental sustainability in Australia. Using econometric modeling, the research finds that FiTs have a long-term effect on reducing carbon emissions, though short-term effects are less pronounced. In contrast, RET policies are effective in both the short and long term. External factors such as the China-Australia trade dispute and the COVID-19 pandemic influence the effectiveness of these policies by affecting supply chains and international collaborations. The study highlights the importance of well-designed policies that balance short-term benefits with long-term environmental goals. It also emphasizes the role of renewable energy rebates in promoting ecological integrity and ensuring long-term sustainability. The findings suggest that while FiTs contribute to long-term emission reductions, their short-term impact is limited. RET policies, on the other hand, consistently reduce carbon emissions over both short and long periods. The study also reveals that trade openness has a negative long-term effect on carbon emissions, while economic growth and population density have positive effects. The results indicate that renewable energy rebates, when properly structured, can significantly contribute to Australia's environmental sustainability goals. The study provides insights for policymakers to develop effective strategies that align with environmental and economic objectives.This study examines the impact of renewable energy rebates, specifically premium feed-in tariffs (FiTs) and renewable energy target (RET) policies, on environmental sustainability in Australia. Using econometric modeling, the research finds that FiTs have a long-term effect on reducing carbon emissions, though short-term effects are less pronounced. In contrast, RET policies are effective in both the short and long term. External factors such as the China-Australia trade dispute and the COVID-19 pandemic influence the effectiveness of these policies by affecting supply chains and international collaborations. The study highlights the importance of well-designed policies that balance short-term benefits with long-term environmental goals. It also emphasizes the role of renewable energy rebates in promoting ecological integrity and ensuring long-term sustainability. The findings suggest that while FiTs contribute to long-term emission reductions, their short-term impact is limited. RET policies, on the other hand, consistently reduce carbon emissions over both short and long periods. The study also reveals that trade openness has a negative long-term effect on carbon emissions, while economic growth and population density have positive effects. The results indicate that renewable energy rebates, when properly structured, can significantly contribute to Australia's environmental sustainability goals. The study provides insights for policymakers to develop effective strategies that align with environmental and economic objectives.