Josh Frydenberg has defended the Coalition’s record on climate change and says he will work hard to earn the trust of his constituents in the face of a challenge from long-time Liberal and now independent Oliver Yates.

Yates, a former Macquarie banker and head of the Clean Energy Finance Corporation, confirmed on Wednesday he would run in Kooyong at the coming federal election, declaring Frydenberg deserved to be challenged because of a lack of action on the environment.

Yates told Guardian Australia that Frydenberg, now treasurer, “had plenty of opportunity to stand up in relation to the environment when he was minister, or even now, as a more influential person, but he’s failed to discharge his duty in relation to environmental responsibility”.

Frydenberg told reporters climate change was “real” and he defended the government’s policy record.

“The Coalition takes very seriously our international and domestic responsibilities and obligations to reduce emissions,” he said.

In rebutting Yates’ arguments, Frydenberg did not mention the policy he tried to implement as environment and energy minister, the national energy guarantee, which was scuttled when party conservatives moved against Malcolm Turnbull’s leadership last year.

But he said he was “proud of the work we’ve done to support the renewable energy target” – a mechanism Tony Abbott as prime minister attempted to wind back, and conservatives within the government still oppose.

Frydenberg said the government continued to fund abatement through the emissions reduction fund, which the Coalition declined to top up in last year’s budget, although the government has signalled more recently that the fund, a vestige of the Direct Action policy, will get a cash injection ahead of the federal election, and its remit could be broadened to look after threatened species and their habitats.

He also referenced ongoing work on energy efficiency and said the government would deliver “the world’s biggest pumped hydro scheme” in an expansion of Snowy Hydro. The government is yet to confirm whether it will back an expansion adding 2,000MW of new generation capacity, which was approved by the Snowy Hydro board in mid-December.

Frydenberg says the Coalition has presided over a reduction in per capita emissions, but emissions have been rising since the Abbott government repealed the carbon price legislated by the Gillard government.

The latest government projections show that Australia will miss its 2030 emissions reduction targets, despite Scott Morrison’s regular assertion that the country is on track to meet its obligations “in a canter”.

The report, released in late December, says emissions in 2030 are projected to climb 4% above 2020 levels, driven by higher levels of liquefied natural gas production, growth in agriculture, increased transport activity and a drop in the amount of carbon reduction from activities such as reforestation in the land use sector.

It projects emissions from all sectors, except for electricity, waste and land use, will grow by 2030.

A new report from the Organisation for Economic Cooperation and Development has found that Australia is not on track to meet its 2030 emissions targets under the Paris agreement and needs to bring its environment policies into line with the “scale of the challenge” the country is facing.

Yates joins other high-profile independents facing off against Liberals in the coming contest, with a number, including barrister and former Olympic skier Zali Steggall, who will take on Abbott in Warringah, citing inaction on climate change as a central motivation.

There is also continuing speculation that Julia Banks, a Liberal who quit the government for the crossbench late last year, will run against the health minister, Greg Hunt, in the Victorian seat of Flinders.

Yates will face an uphill battle to unseat Frydenberg in Kooyong, a prized Liberal seat held by party leaders including Robert Menzies. The treasurer and deputy Liberal leader tends his local turf assiduously, and won the seat in 2016 with a primary vote of 58%, which was a positive swing of 2% on the previous federal contest.