New cars and other light vehicles throughout Australia will be subject to a new fuel efficiency standard as part of several measures contained in a plan to increase electric vehicle uptake.

The Commonwealth Government has unveiled a National Electric Vehicle Strategy, which is designed to facilitate greater uptake of electric vehicles throughout Australia and to expand the affordability, availability and choice for Australians in terms of purchasing an electric vehicle.

The strategy includes new actions that will complement existing Commonwealth and state measures (refer strategy document in link above).

As part of the plan, the government will work stakeholders to design a new fuel efficiency standard that will apply to passenger and light commercial vehicles.

In other new measures, the government will also:

  • Prepare for a recycling, reuse and stewardship initiative for EV and other large-format batteries.
  • Develop a national mapping tool to support optimal investment in and deployment of EV charging infrastructure.
  • Provide tools and guidance to enable EV uptake for residents of existing multi-residential buildings.
  • Provide funding to support guidance, demonstration and training with regard to electric vehicles for emergency service workers.
  • Work with states and territories on a range of matters. These include nationally consistent standards for signage, charging infrastructure, accessibility and safety; sharing of data to understand optimal charging locations; initiatives to improve EV affordability; supporting the rollout of remote and regional EV charging infrastructure; targets for government fleet vehicle purchasing; and promoting nationally consistent education and awareness about electric vehicles.

The strategy comes as Australia’s transport sector has emerged as a critical part of achieving the Commonwealth Government’s greenhouse gas emission reduction targets of 43 percent compared with 2005 levels by 2030 and net zero by 2050.

Overall, transport accounts for 19 percent of Australia’s carbon emissions – with passenger cars and light commercial vehicles accounting for around 60 percent of this.

Particularly if they are powered by renewables in terms of vehicle charging, electric vehicles are seen as part of the solution.

As it is, however, Australia lags other nations in EV take-up.

Whereas electric vehicles accounted for 9 percent of the overall car market in 2021, in Australia they accounted for just 3.8 percent of the market in 2022.

According to the strategy document, feedback received during public consultation indicates that Australian consumers are enthusiastic about EV uptake but are being hampered by issues such as cost, availability/lead times, choice, availability of charging infrastructure and accessibility.

Stakeholder feedback has revealed that a significant reason for the lack of EV choice and availability in Australia has been the lack of fuel efficiency standards which manufacturers have needed to meet in order to sell into the Australian market. (As things stand, all developed nations expect for Russia and Australia have such a standard.)

This has seen car makers prioritise other markets in terms of EV offering whilst using the Australian market to sell traditional cars running on petrol.

To overcome this, the government will work with stakeholders to design a new fuel efficiency standard that will apply to passenger and light commercial vehicles.

The standard – which will apply to new vehicles only – will set limits on overall average greenhouse gas emissions across the range of vehicles which a particular manufacture sells across the nation.

It will not exclude any individual make or model of vehicle.

Provided they achieve the standard on an overall average basis, vehicle manufacturers will have the flexibility to select the range of models which they sell to the market.

The standards will be broadly consistent with those in place in other advanced economies.

A six week consultation process enabling members of the public to have their say on the proposed standard is open until May 31.

Minister for Climate Change and Energy Chris Bowen said the importance of the strategy should not be underestimated.

“This strategy delivers on our commitment to provide greater choice for Australians to drive cars that are cleaner and cheaper to run,” Bowen said.

“This strategy provides the coordination and leadership to drive down costs and improve infrastructure so that we get more affordable and accessible electric vehicles on the market.”

Motoring associations welcomed the strategy’s release.

NRMA Group CEO Rohan Lund welcomed the move to create the new fuel efficiency standard.

“When it comes to Australians buying a new car the NRMA is all about choice – and right now those choices are being hindered,” Lund said.

“Most of the developed world has mandated fuel efficiency standards and the voluntary model that has existed in Australia no longer works.

“It is the NRMA’s view that if we adopt sensible standards we can give more choice to Australians looking to buy affordable fuel-efficient vehicles – while at the same reducing our reliance on imported fuel and delivering a meaningful reduction in carbon emissions.”

However, energy industry experts cautioned that much needs to be done to ensure that the nation’s infrastructure will be prepared to cope with greater EV uptake.

“The federal government’s electric vehicle strategy, which includes new fuel efficiency standards and battery recycling, is very welcome news,’ said Dr Roger Dargaville, Deputy Director at Monash Energy Institute.

“But we need to remember that our country’s electricity grid and charging infrastructure are currently not sufficiently equipped to handle a significant uptake of electric vehicles. We are lagging behind many other countries in terms of charging infrastructure, and so a lot of work is required to build the required charging networks.

“It is important to consider that as the number of EVs on the road increases, we will require more electricity generation to meet the additional demand caused by electric vehicles. However, if we rely solely on our traditional energy generation systems and fossil fuel energy, we will not reap the full benefits of increased EV adoption.

“We need investment in the required infrastructure to support EV uptake. This includes not only charging infrastructure but also the development of a smart grid that can handle the increased demand for electricity with high penetration of renewables and the creation of policies that incentivise private investment in EV charging stations.

“The government must prioritise the development of sustainable supply chains for EVs. This means ensuring that the production and disposal of EVs are environmentally friendly, with measures in place to reduce the carbon footprint and minimise the waste generated during the process.

“The government also needs to consider the potential benefits of supporting a local EV manufacturing capacity. If we rely too heavily on imports, it could affect the cost and availability of EVs in the country.

“Lastly, the government needs to create demand for EVs among drivers. This can be achieved through education campaigns, incentives such as tax breaks and subsidies, and regulations that promote the adoption of EVs.”


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