Clean transport is the way of the future. Imagine our streets and neighbourhoods with electric vehicles in every driveway, super-quiet engines, no fumes and no nasty shocks at the bowser.
Transport makes up 17.6 per cent of total greenhouse gas emissions. It is one of the leading sources of emissions for Australia, and if we are to get to net zero by 2050 the current pace of change is simply not fast enough. We need EVs to account for 76 per cent of new vehicles by 2030. However, cost, availability and infrastructure are significant challenges for everyday Australians, so we need policy intervention to succeed.
The longer it takes the government to firm up a strong EV policy, the longer we will be stuck with dirty combustion engines that other countries don’t want. This is unfortunate because not only are EVs greener, but they are also great to drive, cost-effective to run and better for our health.
We know that EVs are the future of transport, but Australia’s fledgling policy settings make that future feel far off. Australia imports 92 per cent of our fuel, and we have only about a month’s supply in reserve. It’s increasingly clear that pandemics, geopolitical conflicts and climate events can have a serious impact on our supply lines. Plus, the cost of imported fuel has become an enormous burden on both household and federal budgets.
On an international scorecard, Australia is ranked second-worst for transport energy efficiency. Our transport emissions have grown more than any other sector. The average lifespan of an internal combustion engine (ICE) car bought today is about 12 years. We need to avoid locking in those lifetime emissions in our journey to net zero.
So how do we reach critical mass? Cost is a huge barrier to uptake. Currently, the car I drive, a Hyundai Kona EV, costs more than $25,000 more than the same car in an ICE model. That’s a huge difference, and even when you consider the total cost of ownership savings in fuel and servicing costs, it takes a long time to break even.
Recently the government introduced legislation to exempt less expensive EVs (below $78,000) from fringe benefits tax and import tariffs. That narrows the gap to about $20,000.
Research from industry-led collaborative research centre Race for 2030 focuses on incentivising fleet sales of EVs. Fleet managers buy about 600,000 cars a year in Australia and say the price difference between EVs and ICE models is still too high.
To make RVs appealing for fleet managers, we need tax incentives to go further. If fleet companies were able to get a full, instant asset write-off for EVs, they would save about $11,000 over three years. Combining that with the total cost of ownership savings and the various state government incentives would make EVs competitive.
If EVs are price competitive for fleet managers, that’s good for all of us because it is the quickest way to grow the second-hand EV market. Government has a direct role here too and should lead by example. The federal government, along with state and territory counterparts, should commit to buying only EVs for their fleets from 2023 onwards.
The next problem is getting increased supply of EVs into Australia as soon as possible. Already more than half of the population say they want an EV as their next car but are struggling to get a timely delivery. Manufacturers are not prioritising the Australian market for their EVs and one reason is emissions standards. As long as other countries have stronger emissions standards for vehicles, they will command a greater share of the EV market.
Australia is still the only country in the OECD (in the absence of Russia), that doesn’t have or isn’t developing fuel efficiency standards for CO2, and we haven’t adopted the Euro 6 noxious emissions standards on fuel quality that apply to all new cars sold in the European Union. As a result, we have become a dumping ground for cars that can’t be sold elsewhere. This has consequences, not just for the supply of EVs but also for the health of Australians – vehicle air pollution in Australia is estimated to cause about 1780 deaths per year.
The most significant obstacle to uptake, however, is the availability of fast and reliable charging. I have encountered broken charging stations, incompatible chargers, slow chargers and even queues for charging stations. EVs are reaching the tipping point on everything but charging. Just like roads and energy grid infrastructure, EV-charging infrastructure should be led by appropriate government policy and regulation.
Our delayed uptake of EVs has provided us with the opportunity to learn from the countries that were early adopters.
First, we need to encourage universal chargers in Australia, and a charging plug standard, to assure all motorists that there is a charger for them. That way we can avoid an Apple/Android-style compatibility problem. The EU passed laws to standardise phone charging, and now has a similar directive for EV charging, urging manufacturers to adopt the preferred CCS2 standard. As a result, Tesla has retrofitted its supercharging stations with this type of port and installed them on new Model 3s sold in the region.
A network of charging stations should come next. Taking Germany as an example, I’d welcome a government commitment to partnering with the private sector to deliver charging stations through investment matching, with a goal of installing a charger every 150 kilometres.
The Australian Renewable Energy Agency is piloting projects to build chargers on power poles, and private companies are already leveraging electrical substations to provide charging infrastructure. This will make charging much simpler for the estimated 1.9 million homes that don’t have access to off-street parking where an EV can be charged.
Installing charging stations at home is a sizeable investment and having to retrofit buildings adds to the expense. The government should consider a scheme to accelerate the installation of chargers in private homes, strata and rental accommodation, and in car parks in business and industry precincts with incentives such as exemptions from fringe benefits tax.
More than half the homes that Australians will live in in 2050 will be built between now and then, so if we update the building standards for new dwellings to include EV charging, we can set ourselves up for the inevitable future and avoid the more expensive outcome of retrofitting our buildings. Because it takes longer to charge your car than it does to fill it up at the bowser, queue anxiety is another stress. There is already a company in Finland that is creating charging technology that can service several vehicles at a time – the concept blends “first come, first served” with load-sharing distribution so more vehicles can be plugged in, charged to a useful level and on their way. The charge time gets longer the fuller the battery becomes, so what we need is not necessarily just faster chargers but more people able to charge at a time.
Other innovations are coming that will help to address the range of free charging. For example, solar EVs are becoming more common, with the solar car Lightyear claiming to add 70 kilometres of charge per day just being parked outside.
When we see EVs as household batteries on wheels, we begin to see the grid potential. To fully benefit from our EV fleet, governments should incentivise bidirectional charging – or vehicle-to-grid chargers – and encourage car manufacturers to enable this feature in the vehicles that come to Australia. This would turn our fleet into Australia’s biggest deployable battery – potentially bigger than Snowy Hydro. The United Kingdom’s government has created a grant scheme for bidirectional “smart” chargers, and Australia should do the same, reprising the policies that made us a world leader in uptake of rooftop solar. Taking this a step further and factoring in the massive potential of our bus network is an area where state and territory governments can play a key role in increasing the storage capacity of the grid.
As the choice of EVs increases, so does the breadth of appeal. We could see the first electric ute arrive in Australia this year, bringing more green power to worksites where tradies can plug their circular saw and other tools into the bonnet.
EVs are our future and must be a priority of government. Policies that encourage EV uptake will provide environmental, financial and health benefits to households and practical inputs to the grid. It’s a win-win.
This article was first published in the print edition of The Saturday Paper on October 22, 2022 as "Greening the wheels".
For almost a decade, The Saturday Paper has published Australia’s leading writers and thinkers. We have pursued stories that are ignored elsewhere, covering them with sensitivity and depth. We have done this on refugee policy, on government integrity, on robo-debt, on aged care, on climate change, on the pandemic.
All our journalism is fiercely independent. It relies on the support of readers. By subscribing to The Saturday Paper, you are ensuring that we can continue to produce essential, issue-defining coverage, to dig out stories that take time, to doggedly hold to account politicians and the political class.
There are very few titles that have the freedom and the space to produce journalism like this. In a country with a concentration of media ownership unlike anything else in the world, it is vitally important. Your subscription helps make it possible.
Select your digital subscription