The Morrison Government unveiled its first national Future Fuels and Vehicles Strategy yesterday, backed by an expanded $250 million investment to “enhance consumer choice, create jobs, and reduce emissions in Australia’s transport sector.”

In its plan to achieve net zero emissions by 2050, Morrison said the strategy includes $178 million in new funding and more than $500 million of combined private and public co-investment directed into the uptake of future fuels in Australia.

Rather than “forcing Australians out of the car they want to drive or penalising those who can least afford it through bans or taxes”, he added that the strategy will accelerate the deployment of charging and hydrogen refuelling stations to support 1.7 million electric vehicles nationwide.

 

‘Taking the lead on reforms through Energy Ministers’ PM says

“Like we saw with our world-leading rooftop solar uptake, we know that when new technologies reach price parity, Australians rapidly adopt them,” Morrison said.

“We will take these lessons from solar integration into our reform work to ensure our grid is ‘EV ready’ to keep the lights on and bills affordable for everyone.

“Voluntary adoption of electric vehicles is the right pathway for reducing transport emissions over the long term – stringent standards, bans or regressive taxes will limit choice and increase the upfront costs of cars for Australians.”

He said the government will also “take the lead on reforms through Energy Ministers to ensure the electricity grid is ready for an increase in electric vehicles.”

These reforms, he said will help to keep the grid reliable and affordable, along with avoiding the estimated $224 million in electricity network upgrades needed by 2030.

“Without this action, these costs would be passed on to all electricity consumers, even those who do not choose to buy an electric vehicle.”

 

Australians are already making the switch

Morrison highlighted many Australians are “already making the choice to switch to new technology vehicles, with the EV Council reporting that battery electric and plug-in hybrid vehicles hit a record of 8,688 sales in the first half of 2021.”

This is compared to 6,900 in 2020.

He said the government will continue to work closely with the states and territories to address barriers to low emission vehicle uptake in their jurisdictions.

“We will also ensure consumers have access to reliable, easy-to-understand information on low emission vehicles to enable informed choices.”
 

What do the critics say about the Future Fuels Strategy?

But critics have already come to the fore saying the proposed plan ignores the most important and effective measures to improve electric vehicle uptake.

The strategy will support and accelerate the rollout of some charging infrastructure; however it does not include subsidies, tax incentives, or sales targets.

It also fails to deliver minimum fuel efficiency standards, which have been used in the US and Europe for decades.

Fuel efficiency standards require car manufacturers to sell vehicles with a combined level of emissions below a defined benchmark, encouraging the sale of zero-emission vehicles.

University of New South Wales PHD candidate in the School of Biological, Earth, and Environmental Sciences Gail Broadbent says subsiding electric cars and rolling out more chargers could help Australia achieve half of its new car sales to be electric by 2030.

She said the government’s strategy will fall short of what is required to make the transition to EVs quickly enough, adding that Australia could not reach net-zero emissions for passenger cars by 2050.

“Without a mandatory vehicle emissions standard there is no disincentive for vehicle manufacturers to import increased numbers and models of EVs to Australia – decreasing potential choice for consumers,” she said.

“More attention needs to be made immediately to cover the recharger black spots to allay consumers’ perceptions about being able to get around our vast continent.”

People want to be assured they could go for a long trip if they want to, she said.

“Perceptions are very important for consumers, and we shouldn’t disadvantage people living in remote regions of the opportunity to save money on transport.

“By transitioning to EVs more quickly the costs of importing petroleum goes down more quickly and the money saved is spent in Australia – not sent as profits for oil companies overseas.”

 

EV manufacturers could bypass Australia altogether

Compared to other Organisation for Economic Co-operation and Development (OECD) countries, Broadbent said Australia’s adoption continues to sit “stubbornly near the bottom of the leage” with 0.75 per cent of new car sales being EVs.

On the other hand, countries such as Norway represents the best case EV roll-out globally, she said, where 75 per cent of new car sales this year have been electric.

This is then followed by Iceland with half of new sales being electric and Sweden at a third of new sales.

If Australia continues to be one of the only developed nations without fuel efficiency standards, Broadbent said EV manufacturers will bypass Australia and they will send most EVs to markets where there are standards.

“In Europe financial penalties apply if the manufacturers don’t sell enough EVs to meet the standard,” she said.

“Australia would continue to spend billions of dollars on imported fuels and suffer the health consequences of the air pollution from fossil fuelled vehicles.”
 

The trajectory has been set at a global level

Doug McNamee, CEO of Australian start-up Jolt Charge – a provider of EV charging solutions, said setting a national emissions standard for vehicles, as suggested by the Grattan Institute in its Towards Net Zero report, would help create timelines for the industry and further spur investment in EV charging infrastructure.

“This will be absolutely critical to gain momentum in the transition to zero-emission vehicles in Australia,” he said.

Signalling to the market the effective end-date of internal combustion engine (ICE) vehicles, which use petrol and diesel “will align Australia with other major markets globally and create fertile environment for ancillary services such as charging infrastructure and battery technologies.”

But regardless of the policy setting in Australia, McNamee said Jolt Charge only represents about 1.8 per cent of the right-hand drive market.

“We are a technology taker in essence and so we are going to see a transition, very quickly, to whatever the large car markets are doing.

“For us, a large right-hand drive market is the UK who have banned the sale of petrol vehicles from 2030. Others are Japan and India and these markets are moving very quickly in that direction.

“It doesn’t really matter at the end of the day what Australia does because that trajectory has already been set at the global level.”

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