(CNN)Australian Prime Minister Malcolm Turnbull has bowed to pressure from within his own party to drop plans to include carbon emission reduction targets in the government's new energy policy.
Australian PM Malcolm Turnbull makes U-turn on carbon emissions legislation
The decision to renege on a key part of the government's National Energy Guarantee (NEG) has created a political furor and raised questions about Turnbull's future as leader of the Liberal Party -- and the country.
Turnbull had proposed reducing carbon emissions by 26%, from 2005 levels, by 2030 as part of the NEG, in line with the Paris climate agreement.
However, facing backlash from his Coalition government and the threat of a leadership challenge, Turnbull tried to appease critics Friday by proposing setting emissions reduction targets by regulation instead of legislation.
He took it a step further on Monday, announcing at a press conference that the targets would be scrapped entirely from the the NEG.
"Now in politics you have to focus on what you can deliver and that's what we've done and will continue to do," Turnbull said, pointing to strong bipartisan opposition that likely would have prevented the bill from passing.
"We are not going to propose legislation purely for the purpose of it being defeated."
Despite the policy change, Australia remains committed to the Paris Agreement, and may revisit an emission reduction target when there is more support in the House of Representatives, Turnbull added.
The NEG had been met with resistance by a group of conservative MPs led by former prime minister Tony Abbott. Abbott had signed Australia into the Paris Agreement while in office, but later withdrew his support after losing a leadership challenge to Turnbull.
"When the big emitters are not meeting Paris, why should we?" said Abbott in a statement last week.
Abbott and other MPs, including George Christensen and Andrew Gee, had previously indicated that they might cross the floor to vote against the bill.
"There are members of Parliament... who want power prices down, who want to end Labor's emissions obsession, who are not worshipping at the altar of the climate change gods, and who are prepared to stand up for traditional Liberal conservative values," Abbott said earlier in August on Sky News Australia.
On top of the opposition to his energy plan, Turnbull faced a separate threat to his role as prime minister as speculation spread that Home Affairs Minister Peter Dutton might run for the party leadership.
Dutton rejected the rumors on Friday, tweeting that "the Prime Minster has my support and I support the policies of the Government."
At the press conference Monday, Turnbull dismissed the rumors as well, saying he had just spoken to Dutton.
"He's a member of our team, he's given me his absolute support," Turnbull said.
Still, the controversy and rumors may have weakened Turnbull's standing, and exposed deep divisions between the country's two major political parties.
Turnbull acknowledged the latter on Monday, saying the Labor and Liberal parties were "poles apart."
Treasurer Scott Morrison was less subtle.
"Let's not kid ourselves here; Labor are simply playing politics with people's electricity prices," he said at the press conference. "They are looking to cause trouble for the government. That's what has motivated them, not lower electricity prices."
Turnbull's reversal and the political hullabaloo come amid a growing debate about climate change in Australia.
A statewide blackout across South Australia in 2016 raised questions about energy security and renewable energy, and New South Wales is currently battling a crippling drought, which experts say is evidence of the effects of climate change.
Meanwhile, warming oceans and marine heat waves have killed off almost half the corals on the world-famous Great Barrier Reef, with scientists urging immediate climate policy change to help the surviving coral.