Macquarie Group’s leasing arm and the Clean Energy Finance Corporation will offer $100 million in cheap finance to kickstart puny sales of electric vehicles such as Tesla and Nissan Leaf in Australia.
The program will offer electric vehicle leases at a 0.7 percentage point discount to Macquarie Leasing’s standard rate to rein in carbon dioxide emissions from petrol and diesel vehicles.
The program will include plug-in hybrid electric vehicles such as Toyota’s Prius, electric vehicle chargers, emissions reducing equipment such as rooftop solar and battery systems, and energy efficient appliances such as air conditioners and building management systems.
CEFC’s Bobby Vidakovic said the program would finance about 1200 vehicles and accelerating the takeup of electric vehicles would help drive the rollout of charging stations and other infrastructure to make people more likely to consider electric vehicles.
CEFC has $700 million of programs with other financiers for energy efficient equipment. Mr Vidakovic said Macquarie’s market clout “has enabled us to target electric vehicles to get scale.”
Upfront costs a deterrent
Interest in concessional loans for clean energy vehicles and rooftop solar and battery systems is growing because the upfront cost can deter many households. Atlassian founder Mike Cannon-Brookes has invested in home energy funding platform Brighte to boost rooftop solar and battery uptake.
AGL Energy is aiming for 10 per cent of its fleet to be electric vehicles and offers concessional loans to staff. Energy companies offer solar and battery systems to households and businesses on easy upfront terms.
Transport is Australia’s fastest growing source of CO2 emissions, accounting for 93 million tonnes or 18 per cent of the national total, and the sector enjoys easier fuel efficiency and emissions standards than in the US and Europe.
The Macquarie-CEFC partnership will take just 200,000 tonnes out of that total, but the government hopes the initiative will kickstart the electric vehicle market in Australia, which was in reverse gear last year with only 1300 vehicles sold in a market of nearly 1.2 million vehicles.
“Electric vehicles will play a big role in terms of creating more sustainable cities with less pollution and improved health outcomes for our community,” energy minister Josh Frydenberg said.
“By providing discounted finance through the CEFC, it is hoped we can encourage a greater up take of electric vehicles and reduce emissions.”
Mr Frydenberg said this was one of the ways in which Australia will meet its Paris commitment to reduce CO2 emissions by 28 per cent from 2005 levels by 2030. He announced $390,000 funding via the Australian Renewable Energy Agency in May to accelerate EV rollout.
Jon Moodie, Head of Macquarie Leasing, said the program would help people and firms seeking to reduce their carbon emissions through their choice of vehicles and other equipment.
Sales of electric vehicles stalled in 2016, sliding from 1700 a year earlier to 1300, and the total of just 5000 is a tiny fraction of the estimated 2 million electric vehicle fleet worldwide.
The slow takeup has stalled the rollout of charging stations that are needed in greater numbers for drivers to get over “range anxiety” – a big problem in a large, sparsely populated country like Australia.
Extracted from AFR.