All new car sales must be electric by 2027 for Sydney to meet climate targets, think tank says

All new car sales in Sydney will have to be electric vehicles by as early as 2027 if the New South Wales capital is to have any chance of meeting its 2030 and 2050 emissions reduction targets, a new report has found.

The report, published on Monday by policy think tank Committee for Sydney, finds that despite NSW’s “nation-leading” climate and renewables policies, including announced coal plant closures, Sydney is not on track to meet its net-zero obligations.

The current suite of state policies and incentives, modelled in the report as the Steady Transition scenario, is forecast to cut Sydney’s emissions by around 43% by 2030, and around 80% by 2050.

To cover the shortfall, the report recommends setting Sydney on an “Accelerated Net Zero Transition” pathway that relies heavily on the fast-tracked electrification of homes and businesses and – most crucially – of cars.

This rapid shift to electric vehicles – which the report concedes looks “highly unlikely” in the context of current market conditions – would require 100% of passenger car sales to be EVs in 2027, leading to approximately 850,000 passenger EVs on the road by 2030.

“From now until 2030, faster adoption of electric vehicles is needed for Sydney to be on track to meet emissions reduction targets,” the report says.

“Our Accelerated Net Zero Transition model shows we need a much faster ramping up: all new cars need to be electric by 2027, so EVs make up ~30% of the passenger fleet by 2030 – twice as much as in the Steady Transition approach.

“Instead of ~470,000 EVs on Sydney’s roads, by 2030, there need to be ~850,000 to achieve the modelled passenger vehicle emissions reductions.

“If EVs don’t reach ~30% of Sydney’s total passenger vehicles by 2030, which would require an unlikely 100% of new car sales to be electric by 2027, reducing the use of coal in the generation mix is the only lever large enough to close the gap,” the report concludes.

To achieve this “unlikely” fast-track to EVs in Sydney, the report – which was contributed to by Ausgrid, Dexus, Endeavour Energy, NSW Department of Planning and Environment, and the Greater Cities Commission, with research from McKinsey and Company – offers a number of recommendations.

Chief among them are fuel efficiency standards – which had been notably absent from all state and federal policy agendas in Australia until just two weeks ago when they were opened to “discussion” by the Albanese government.

“Enabling faster adoption requires an integrated range of policies, subsidies and awareness campaigns, and regulations that favour EVs – along the lines of the fuel efficiency standards in California, and phasing out petrol and diesel vehicles like the UK and Europe,” the paper says.

Other recommendations include the introduction of a national incentive scheme – on top of existing state incentives – that would bring down the upfront cost of buying an EV by around $11,000; a move the report suggests could entice another 200,000 EV purchases.

“Our analysis demonstrates there is no real alternative to EVs replacing petrol/diesel cars on our roads. A shift to alternate forms of transport, and associated reduction in vehicle travel, is offset by population growth so does not avoid as many emissions as switching to EVs.”

As well as policies, subsidies and awareness campaigns, there will also need to be a rapid roll-out of supporting infrastructure – namely, extensive public and private charging networks – and some fast work by utilites to accommodate for huge amounts of EV charging on their networks, and to make it smart.

In comments on the report, Endeavour Energy – which runs the electrical distribution network for Greater Western Sydney – says it’s current forecasts are to have more than 65,000 electric vehicles on its network by 2027, with 1.3 million by 2040.

“Our customers are telling us that they want to take control of their energy to suit their individual circumstances and want us to ensure the grid is ready for this transformational change,” said Endeavour CEO Guy Chalkley on Monday.

“We must take stock of the short-term volatility in the economy and cost of living pressures whilst now taking the opportunity to reposition the electricity system to achieve balanced long term customer outcomes.

“Through leadership, collaboration and regulation we can make sure all customers reap the benefits of renewable energy and electrification in an empowered and least cost way as we work towards net zero,” Chalkley said.