Australia has been urged to follow the Tory government in the UK and impose a ban on sales of new fossil fuel cars by 2035, just as the local electric vehicle market starts to show signs of life amid a sharp slump in the sales of petrol and diesel cars.
The Electric Vehicle Council on Thursday issued new data that confirms The Driven estimates, published last month, that showed sales of plug in electrics have tripled from just 2,216 in 2018 to 6,718 in 2019 (including plug in hybrids).
The jump was driven mostly by Tesla which accounted for 70 per cent of electric sales, mostly through the Model 3.
But according to the EVC, if Australia had a similar rate of uptake to other countries there should be about 50,000 new EVs on Australian roads.
And although Australia is ripe for the transition, and increasing numbers of customers are saying their next purchase will be electric, there is a policy vacuum – and a shortage of available models – that is holding Australia back
EVC chief executive Behyad Jafari and the principal clean energy transition advisor for Ernst and Young, Matt Rennie, have called on Australia to follow the UK, which announced this week that it would bring forward its ban on new petrol and diesel car sales from 2040 to 2035, and add hybrids to the black list.
They say that if the policy vacuum is not addressed soon, Australia will fall even further behind the global transition to clean transport, because car makers will be discourage from bringing more affordable electric cars to market, says Jafari.
“The bad news is that even with this strong growth, EVs still one represent 0.6 per cent of sales. That compares poorly to 3.8 per cent of sales in Europe and 4.7 per cent of sales in China,” he told The Driven.
“If the Australian EV market had the same incentives and support as the EU and China, we would be talking about some 50,000 new EVs on our roads.
“That would actually start delivering significant benefit in terms of cleaning our air, lowering our carbon emissions, and lowering our dependence on foreign oil.”
The Morrison government, which attacked Labor’s proposed target of 50 per cent share of new car sales for EVs by 2030 in the lead up to the last election, is due to unveil its EV strategy later this year.
So far, it has resisted calls for EV incentives. The main auto industry body, the Federal Chamber of Automotive Industries, said any such initiates should include support for efficient petrol and diesel cars.
“The automotive industry has achieved significant gains in the increased efficiency of internal combustion petrol and diesel engines and they will continue to play a significant role for many years to come,” the FCAI said in a statement.
However, Jafari and Rennie talked of the additional societal benefits of electric vehicles, such as improved air quality and associated health benefits, as well as reduced carbon emissions.
“But what we keep seeing is car companies saying, ‘We’re not going to bring the products here because there isn’t the appetite’,” Jafari said, citing the example of South Korean car maker Kia.
“It’s something that has happened to Australia several times over these past few years….for a car maker to bring an EV here is an investment decision.
“They make that decision, but then policy tightens overseas and then car companies say no, now we have to take that allocation over there.”
The policy vacuum could also cause an increasing gap between uptake in the capital cities and in regional areas, says Rennie.
Once price parity with internal combustion engine (ICE) vehicles is reached, it will only be a matter of time before people start buying EVs instead – but they need confidence that there is adequate charging infrastructure.
“The interesting thing about customers is they make rational choices all the time,” says Rennie. “Prior to the iPhone none of us could have imagined we could have all that in one device.”
“Once we reach cost parity, people will make the decision to buy electric vehicles on two things – one, will they have enough range to drive around as we do now. All of the evidence suggest those things are being solved.”
“The second variable is availability of infrastructure. I have no doubt in my mind we will have infrastructure in urban areas ahead of a boom of electric vehicle uptake.
“What worries me is will we have that in regional areas.”
Labor campaigned for a 50% electric vehicle target by 2030 in the lead up to 2019’s federal election but bore the brunt of a deliberately misleading counter-campaign from the Coalition incumbents that turned much public opinion against electric cars with suggestions that they would “ruin the weekend”.
While an electric vehicle strategy is expected from the Coalition in mid-2020, Jafari says that if it only focusses on how to support electric vehicles when they arrive, it won’t address getting them here to begin with.
“What would be impressive would be seeing the government doing what other countries are doing. Saying, we are going to do something about it to get those benefits,” he says.
In addition to introducing policy to encourage car makers to bring more electric vehicles to market, there also needs to be more funding to ensure regional areas have adequate electric car chargers.
Although many people will often charge overnight like a mobile phone, enough DC “fast chargers” are needed to help alleviate the range anxiety often cited as a barrier to uptake of EVs.
“Certainly with charging infrastructure there is some movement, thanks to ARENA which has been able to fund some of those programs,” says Jafari.
“But for that level of funding, is there going to be a level of charger availability that people feel comfortable with? Certainly not.”
Already at the forefront of other clean technologies such as solar and batteries, Australia is in a perfect position for increased electric car uptake, says Rennie.
“One in four homes have solar,” Rennie tells The Driven. “We are seen on the world stage as testbed for new technologies – we think Australia should be first cab off the rank for the energy transition.”
Rennie outlines three tipping points that he thinks will ensure electric cars become as mainstream as smartphones and laptops.
“First, in 2021 we think using solar and batteries will reach the same price as getting electricity off the grid,” Rennie says.
“We are the first to reach that tipping point as we have a high penetration of solar. That’s why Tesla is starting to focus on Australia, because we’ll be the first to reach this tipping point.
“In 2025 we think electric vehicles will reach cost parity with combustion engine vehicles, and in 2042 we think it will be cheaper to generate electricity from solar and batteries on your house than the cost of just getting electric to your house through poles and wires.
“What those three tipping points mean, is we are justifiably at the forefront,” says Rennie.
Jafari says that the accelerated ban in the UK will enable car makers to be confident in bringing more EVs, and it will stimulate the British economy.
“UK consumers will have access to the latest and most affordable EV models, and charging infrastructure will proliferate. If we embarked on similar policies the same thing would happen here,” he said in a note.
“We have to decide what this means for Australia, which is to start at the beginning,” Jafari tells The Driven.
“If we look at what Australia should do, it sounds completely wild to do same thing.
“If the UK is at 10, moving the dial up to 1 would be a good start.”
Rennie agrees. “The government making the decision to intervene carefully in the market is probably a good idea,” he says.
“A decision like the UK one is the only way to offer uniform opportunity across cities and regions,” says Rennie.