A Review of Australia's Renewable Energy Target is used to contribute to the concept of negative externalities in consultation processes, including wasted investment by stakeholders and reduced investor confidence. The findings indicate that there is a need to establish clear consultation objectives. The paper concludes with a model for consultation agents to consider when initiating a consultation process. The model stresses the need to make objectives of the consultation process transparent to stakeholders, including the extent to which the outcomes of consultation are likely to result in changes to policy. Consultation agents and policy developers should seek to identify potential negative externalities at the outset of any consultation process, and address these within the consultation framework where possible. © 2014 National Council of the Institute of Public Administration Australia.