As Australia continues to lag behind the rest of the world in the uptake of electric vehicles – and snub the environmental benefits and economic opportunities that could go with it – the call is growing for the federal government to finally do something, and setting a target for its own fleet seems an obvious first step.
The issue came briefly into public debate just before Xmas, when the federal government announced it was looking at renewing the chauffeur-driven “Comcars” that are used to ferry around ministers and MPs.
Currently, they are driving Australian-made Holden Caprices, but as there is no significant local car manufacturing industry any more, only fossil fuel cars costing $100,000 plus from major European brands like BMW, Mercedes and Audi seem to be on the agenda.
Senator Tim Storer, the independent from South Australia who chaired the recent Senate committee into EVs, wants the federal government to set a target of 50 per cent of new purchases for its 5,000-strong car fleet by 2025.
He got the Parliamentary Budget Office to do some modelling, based around current prices for EVs and ICE (internal combustion engine) cars, and the cost over forward estimates (the next four years out to 2022) was just $5 million.
That’s not much for the government to send a strong signal to the community, and more importantly to the EV manufacturing industry and charging network providers, that it is serious about this transition to EVs, which even the die-hards in the major parties appear to accept is both inevitable and beneficial.
Having a large component of EVs in the government target has an added benefit to consumers – apart from encouraging more manufacturers to make models available in Australia, and for others to install the necessary infrastructure, it will also create a strong second-hand market.
This will be critical for those interested in getting EVs but unable to contemplate the high ticketing price for new models. Even when EV prices gain parity with ICE cars around 2025, many consumers will rely on a second-hand market to gain access.
The PBO analysis was based on the fact that around 1,500 new vehicles are acquired by the Australian government fleet per year, and reaching the 50 per cent target by either 2025, or 2030 (the other option that is being considered), would be gradual.
The $5 million cost for a 50 per cent EV share in the forward estimates is minimal. And the eye-watering estimates of the long-term cost of the plan ($39.5 million by 2025 and $80 million by 2030) are likely inflated, as the PBO says it assumes that EV prices will continue to rise along with ICE vehicles over the next decade.
This is a bizarre and clearly wrong assumption – and quite where the PBO got that idea is not clear, given that just about all the evidence given to the EV inquiry was that EV prices will fall quickly, and by 2025 will be on parity with ICE vehicles.
An argument could be made that for luxury vehicles deemed suitable for our MPs, judges and other dignitaries, they already are.
Jake Whitehead, from the School of Civil Engineering at the University of Queensland, says specific electric vehicle targets for government fleets should be a priority step for all governments in Australia, which between them purchase about 50,000 cars a year.
So far, only the ACT has gone far down that track – vowing to eliminate ICE purchases from 2021, although Queensland has a modest target (of doubling sales each year from a low base), and NSW has proposed a 10 per cent target by 2021.
In the federal fleet, only 10 of the 5,735 passenger vehicles are electric or plug-in hybrid, and none of the 4,816 light commercial vehicles, 1467 heavy commercial vehicles, 626 “other vehicles,” or 47 motorcycles.
Almost everyone agreed that it would be a good idea, for environmental and economic reasons, including a boost to local manufacturing, and for the second-hand market so critical to consumers.
“Government fleet purchases …. are very important because they fuel the second-hand market, and it also means that fleet providers and companies that manage private fleets change their processes,” Tesla’s Sam McLean told the inquiry.
“They look at the total cost calculations, they update their way of rolling out vehicles to include charging stations et cetera. So government fleet targets are a very effective way of driving change not only in government fleets but beyond.”
Storer recognised this, and the proposed mandate was the lowest cost item of his range of incentives for encouraging the uptake of EVs in Australia. All these incentives ended up being “revenue neutral” because of proposed changes to the luxury car tax.
But the major parties wouldn’t budge. The Liberals and Labor agreed that such a target might be a good idea, but like all the other recommendations put forward by Storer, making any decision was put in the too hard basket.
Instead, after listening to six months of testimony from nearly every EV expert and stakeholder in the country, the best the major parties could do was to announce – let’s look into it.
Hopefully, the forthcoming election campaign might bring out some vision and ambition. Don’t count on it though.