In its new report, the spending watchdog said public bodies in all sectors recognise decarbonisation is important.
But it said: “Since 2022, financial and political pressures have caused decarbonisation to fall down the priority list.
“Public bodies told us their overall financial pressures mean they are struggling to invest in decarbonisation.”
It criticised the Welsh government for not defining the “collective ambition” for net zero by 2030 as a “target”.
“There are also no penalties or incentives to drive compliance. Some public bodies told us this had added to uncertainty around the level of priority to attach to carbon reduction.”
On spending, it added that public bodies had made “limited progress” overall in understanding how much it will cost to decarbonise in the near or longer term.
“Where public bodies have estimated the longer-term cost, some described it as unaffordable.”
Ann-Marie Harkin from Audit Wales said: “We can list positive examples, but not enough progress has been made overall, and we owe it to future generations to do better.”
In 2017, the-then Labour Welsh government called for a net zero public sector by 2030, saying that public bodies were “uniquely placed” to influence emissions in areas such as buildings and transport.
The thinking was that if government-backed bodies made the switch and invested in infrastructure like electric vehicles and charge points, renewable power and heating systems, it would make it easier and cheaper for the public to follow suit.
The “collective ambition” does not require every public body to reach net zero individually by 2030 but it is meant to provide a shared direction of travel and an expectation that all public bodies contribute towards reducing emissions.
Responding to the report, a spokesperson for the Welsh government said: “A net zero public sector is a priority for Welsh government.
“We want to continue to support the decarbonisation of the public sector to lower emissions, energy bills and strengthen energy security.
“The 2030 ambition has driven action and leadership, but it’s clear that there is more work to do on decarbonisation across and beyond the public sector in Wales.
The current Plaid Cymru government’s ambition is for Wales, as a whole, to reach net zero by 2040 – which is ten years sooner than the current legally binding target for Wales and UK.