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Dumping ground no more? Australian Government’s affordable EV push

The newly-elected ALP Federal Government says it wants Australians to have a greater choice of affordable electric vehicles (EV) after years of inaction out of Canberra.

The Government today got the ball rolling on its National Electric Vehicle Strategy, with a discussion paper soon to start taking submissions from the car industry and other stakeholders.

According to most industry stakeholders this is long overdue.

The core policy to be addressed is the belated introduction of fuel efficiency standards and the application of a binding tailpipe CO2 reduction scheme, which the car industry and other stakeholders have long said is essential to unlock greater EV supply.

Apart from Russia, Australia is the only OECD country to not have, or be in the process of developing, fuel efficiency standards of this type.

“The lack of such standards in Australia is cited as one of the factors impacting the
supply and cost of EVs,” contends Climate Change and Energy Minister Chris Bowen.

“Why? Because while Australia doesn’t show leadership, manufacturers prioritise
markets which do.”

The timing lines up with today’s Canberra EV Summit organised by the Electric Vehicle Council, Smart Energy Council and the Australia Institute.

The Summit did not include the car brands’ peak lobby group, the FCAI, which has been pilloried for pitching a fuel efficiency and CO2 emissions-reduction scheme that’s less demanding on its members than similar policies in Europe or the United States.

MORE: Australia’s car lobby accused of white-anting plans to cut CO2

The imminent paper’s pitch said Australia was “significantly behind the pack” when it comes to electric vehicles, pointing out that people in the United Kingdom could choose 26 low-emissions vehicles under the equivalent of $60,000 – more than triple the choice available here, where EV penetration sits at around 2.0 per cent.

That being said, there are more than 50 EVs coming to Australia in the foreseeable future – albeit more often than not in limited supply.

MORE: All the EVs coming to Australia: Launch calendar, what’s here already?
MORE: Australia’s best-selling EVs in the first half of 2022

“We believe that now is the time to have an orderly and sensible discussion about whether vehicle fuel efficiency standards could help improve the supply of electric vehicles into the Australian market, to address the cost-of-living impacts of inefficient cars, and to reduce emissions from the transport sector,” the abstract said.

This certainly lines up with the view of Volkswagen Group Australia boss Paul Sansom, who told us that this sort of plan, actioned elsewhere, “changes the game completely, it really does, and it will almost change the game overnight [here] if we can get those”.

The Minister for Climate Change and Energy and Minister for Transport have both written to State and Territory ministers inviting participation in the development of the Strategy.

So far, EV rebates and tax relief have largely been delivered by the various state governments instead.

MORE: What electric car buyer incentives are offered across Australia?

“The Albanese Government will provide the leadership that’s been lacking at the federal level, to work collaboratively with the states and territories, industry, unions and consumer groups to deliver Australia’s first National Electric Vehicle Strategy – that is fit for the 21st century,” said Minister Bowen.

“Up until now, Australian households and businesses have had very little choice regarding low-emissions and fuel-efficient vehicles, and they have been paying for it.

“Today’s announcement forms part of our upcoming consultation on Australia’s first National Electric Vehicle Strategy to make EVs cheaper, increase their uptake and roll out more charging infrastructure – ensuring more Australians can access these vehicles and reap the benefits.”

Infrastructure, Transport, Regional Development and Local Government Minister Catherine King added:

“We’re committed to ensuring an Australian vehicle market provides consumers with easier access to affordable and popular cars, including EVs that are better for the back pocket and the environment.

“We want to hear your views on how best to design fuel efficiency standards in Australia to meet industry and consumer needs now and for generations to come, so I encourage people to have their say.”

In late July the Federal Government placed an earlier and already detailed electric vehicle (EVs) incentives bill before the Australian Parliament, at it progresses to implementation stage in some form.

Rather than focusing on direct rebates like many of Australia’s states, the Albanese Government’s initial plan centred around tax breaks to cut prices and drive take-up.

The legislation (called a Treasury Laws Amendment) exempts low-emissions cars from fringe benefits tax (FBT), potentially saving employers and private vehicle operators thousands.

The Albanese Labor Government also recently introduced legislation to bring forward the introduction of lower-sulfur petrol sold in Australia from 2027 to 2024.

By December 15, 2024, all petrol at Australian service stations will have a maximum sulfur level of 10 parts per million. This applies to 91 RON, 95 RON, 98 RON and E85 unleaded fuel.

MORE: Australian Government EV discount bill enters parliament
MORE: Q&A with Paul Sansom, Volkswagen Group Australia managing director

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