Australia should follow the lead of the United Kingdom and eventually ban petrol and diesel cars to encourage the uptake of electric vehicles to help reduce the nation’s carbon emissions, according to the peak industry body.
Critics have long accused the federal government of doing nothing to incentivise the uptake of electric vehicles or improve fuel standards in Australia.
However, Electric Vehicle Council chief executive Behyad Jafari said he hoped the UK decision to ban the sale of petrol and diesel cars, including hybrids, by 2035 would encourage some action by the Morrison government.
Electric vehicles make up only 0.6 per cent of new car purchases in Australia, compared to the global average of 3.5 per cent, but Mr Jafari said the uptake of electric vehicles would reach a “tipping point” within five years as they became better value than petrol or diesel cars.
He said Australia should set a target of 50 per cent electric cars by 2030 and provide financial incentives to encourage motorists to buy battery-operated cars, such as rebates on charging stations at homes.
“You put a target in place to allow companies to provide the investment to keep building lower-cost cars,” Mr Jafari told The Australian Financial Review.
“And when that economic tipping point is reached and electric vehicles are cheaper, you can pull away those incentives because the groundwork has been laid.”
Automotive groups in the United Kingdom have described the ban on purchasing traditional cars as unworkable, as they account for 98 per cent of the current fleet.
But other countries have also adopted aggressive targets, with Norway banning all petrol cars by 2025, with France and Germany committing to 2040. China has also made a conditional commitment to the 2040 goal.
‘Nothing in place’
Mr Jafari said Australia lagged the rest of the world when it came to lifting fuel efficiency standards and encouraging the uptake of electric vehicles.
“Australia has nothing in place. Not only are other countries doing more but they are constantly increasing what they are doing which is pushing us further behind,” he said.
“It’s not a guessing game any more. We know what’s going to happen with the price of batteries. As these companies are building these cars we want to make sure they come to Australia and we don’t miss out because other countries have more generous incentives and policies.”
While Australia’s carbon emission reduction policies have mostly focused on the electricity sector, transport account for 19 per cent of emissions.
Australia has baulked at increasing fuel standards to help lower carbon emissions, while federal Energy Minister Angus Taylor has yet to release the government’s national electric vehicle strategy.
Mr Taylor said the strategy to ensure a “planned and managed transition” to EVs would focus on practical action to address barriers to EV uptake. It will be released by mid-year.
“Through the Australian Renewable Energy Agency, the government has already made a number of targeted investments in charging infrastructure, including along interstate highways connecting our major capital cities,” he said.
EY energy leader Matt Rennie said the federal government should consider a UK-style direct intervention strategy to send a strong signal to the industry to start building the necessary green transport infrastructure, such as EV charging stations, which is expected to cost more than $5 billion over the next 20 years.
“Australia doesn’t make cars. We need to stay aware and in step with decisions made by other developed countries to both prepare as a society and as a government,” Mr Rennie said.
“The energy transition is not a small issue and governments need to think early and hard about the signals they are sending to unlock these types of investments.”
Infrastructure Partnerships Australia Adrian Dwyer said Australia didn’t need to set a target to ban petrol cars, but needed to prepare for their impact on taxation revenue (with a declining fuel excise) and the power grid (as drivers charge up at night).
“They need to answer the challenging questions like how we pay for roads without fuel excise, what tens of thousands of car plugging into the grid at 6pm does to our energy system, and how we maximise the benefits of a potentially transformational technology,” he said.
The IPA has previously called for road-user charging to ensure electric vehicle drivers are taxed in the same way petrol drivers are slugged with the fuel excise.
Extracted from AFR