Like many industries, the Australian petrol-convenience industry has been considering how best to accommodate a forecast expansion in electric vehicles – almost entirely passenger vehicles – between now and 2030. While this issue has been given periodic consideration of Australian governments and industry for much of the past decade, the recent release of the Federal Government’s Future Fuels and Vehicles Strategy (see Future Fuels and Vehicles Strategy | Department of Industry, Science, Energy and Resources) has energised this agenda

The Federal Government’s Strategy has been designed around the goal of EVs accounting for at least 30% of all new car sales being electric vehicles by 2030 – leading to 1.7 million electric cars operating on Australian roads by that time.

While some have criticised this target for being too conservative against the background of an estimated 15M passenger cars being in operation by 2030, the target looks particularly optimistic when compared with the fact a bit over 20,000 EVs were sold in Australia over the last decade (Source: Motor Vehicle Census, Australia, 31 Jan 2021 | Australian Bureau of Statistics (

What has changed, however, is that the number of new EV cars on the market in Australia has increased dramatically over the last 10 years, with more than 50 different models being offered for sale in the Australian passenger car market during 2022. In addition, most Australian State/Territory Governments have implemented policies that provide grants to EV buyers and government grants to subsidise the establishment of EV charging infrastructure.

“It is fair to say that the next decade will undoubtedly see an increase in the number of EVs operating on Australian roads and our industry needs to consider how best to future-proof our businesses in the face of this change” said ACAPMA CEO Mark McKenzie.

“But with a national fuel retail network asset valued at more than $30B in aggregate, and individual site assets with an average value of just over $4M, deciding how and when to diversify into EV charging alongside fuel on a service station forecourt is very challenging”, added Mark.

In one case, for example, a forward-looking fuel retailer has estimated that the installation of ten EV fast chargers at just one site on a major national highway route will cost around $20M – much of this cost being the cost of grid augmentation works required to support the high electricity draw of these chargers.

“Such an investment is simply impractical at this current point in time”, said Mark.

The fuel retail industry cannot afford to be left behind in terms of EV charging. Equally, given the current the high cost of fast charging EV infrastructure (and the very low number of EVs as a proportion of all cars in operation in the Australian passenger car fleet), service station owners must take care not to invest too far ahead of real-world demand.

“While our industry seriously looks at the forecourt energy diversification challenge, there are some commentators advancing arguments for EV adoption with such zeal as to make their commentary simply implausible, added Mark.

Two such arguments have appeared in the national media in recent weeks. The first is the suggestion that the current high average retail petrol prices is driving motorists towards EVs (See Petrol price growth rate at 31-year high, prompting many to pursue electric vehicles – ACAPMAg).

At the moment, the average passenger car (old and new) consumes 11 litres of fuel per 100 km in a combined cycle and travels an average of 11,000kms per year (Source: Survey of Motor Vehicle Use, Australia, 12 Months ended 30 June 2020 | Australian Bureau of Statistics ( Within this context it should be noted that new conventionally fuelled vehicles – the ones being sold in competition to new EVs – have an average fuel consumption that is significantly lower at around 8 litres per 100km.

The above figures reveal that the average Australian passenger car consumes 1210 litres of fuel per year. At the current ‘record high’ average petrol price – rounded up to $2 per litre for argument’s sake – the total annual fuel cost is $2420 per year. If you were to assume that the electricity cost of an EV was zero – once again to be conservative – then it would take a new EV owner 8 years to recover the average $20K price premium paid for their EV when compared with an equivalent petrol-powered vehicle.

Noting that the first life of a passenger car – that is the period that the vehicle is owned by the original purchaser before being sold – is about 5 years (albeit lower for 50% of vehicles sold to commercial fleet buyers) – then the owner would effectively lose around $8,000 over the life of the vehicle.

“In order for the first owner of an EV to break even, the average petrol price would need to be at least $3.50 per litre, which makes a complete mockery of current claims that the high price of petrol is driving people to consider EVs”, said Mark.

That said, those buying EVs today generally recognise that it is costing them more but they are making the choice for environmental reasons – and because they can afford to pay the high price premium of an EV compared to an equivalent conventionally powered car (see Electric vehicles and the daily reality of owning one – ACAPMAg

The second claim that has emerged is that EVs will achieve price parity with conventionally powered vehicles in the next 2-3 years. This claim is built on some very dubious arguments about both the effect of economy of scale benefits derived from dramatic increases in annual sales of EVs in Australia (and being passed on to EV buyers in the form of cheaper vehicles) and/or technological breakthroughs that will deliver substantial cost savings in terms of on-board battery technology.

The argument about economy of scale benefits has emerged against a background of recent new car sales figures that revealed sales of EVs had increased 6-fold to 17,243 in 2021 (with the Tesla Model Series 3 accounting for 12094 of these sales). But, at just 17,243 vehicles in total, EV sales accounted for just 1.61% of the more than 1,050,000 million passenger cars sold in Australia during 2021. Such numbers, even despite the impressive growth, are hardly sufficient to deliver economy of scale benefits anytime soon.

On the price parity front, it is fair to say that progress is being made – but it is painfully slow. The first priority of most manufacturers appears to be getting range parity ( Electric vehicles set for range parity with petrol cars by 2024 – ACAPMAg) – that is the same distance travelled per vehicle charge as conventional vehicles get from a tank of fuel – and this work is actually increasing the unit price of EVs at present.

It is for this reason, that price parity for EVs is still likely to be some time away given the challenges of building EVs that deliver the same utility as conventional vehicles (An interesting perspective on this issue is provided in Cheaper electric vehicles have been hyped for 2022, but industry commentators say don’t get your hopes up yet – ACAPMAg).

There is always a danger in trying to bring reality to a debate that is characterised by enthusiastic new technology advocates, such as EVs, as such commentary is often characterised as being ‘out of step’ with modern thinking. Interestingly, those making outlandish claims about such technologies in clear contrast with the realities of market adoption are rarely called to account.

“But the reality is that for EVs to truly take hold, the investment landscape must align with the policy landscape – and we still have some way to go before that happens for EVs in Australia”, concluded Mark.

In the meantime, our industry will continue to engage in the market as we strive to work out the optimal time to ramp up the rate of investment beyond the current level of ‘experimental investment’ already occurring in the Australian fuel retail industry.

For its part, ACAPMA will continue to work with all Australian Governments, the electricity industry, Australian energy market regulators and EV charging providers to develop solutions that reduce the investment risk for fuel retailers in the future.