Policy environment

Government policy and incentives have supported adoption of electric vehicles (EVs) in countries where the transition from internal combustion is more progressed. Australia has lagged, though some positive signs are emerging.

HELLERUD In Australia, the missing piece of the puzzle is government policy and regulation. There is certainly demand from Australian consumers but ultimately it comes down to supply. Australia has the highest per-capita uptake of rooftop solar in the world but the lowest rate of EV ownership among developed countries.

The EU and the Nordic countries have mandatory carbon targets for car makers that are enforced with hefty fines. OEMs [original equipment manufacturers] can gain carbon credits and offset emissions associated with internal-combustion engine vehicles by selling EVs. It is a carrot-and-stick approach within the regulatory framework, supplemented by consumer incentives that assist with affordability.

The virtual absence of this type of regulatory framework and policy incentives in Australia means OEMs are not incentivised to supply in Australia. I think this is the biggest problem we face.

DAVISON How likely is it that the policy environment will change – including at state level? What initiatives are already in place?

TAM Eventually, there will be very few ICE [internal-combustion engine] vehicles available and the whole world will have switched to EVs. The day is coming, but it is a question of how fast we will get there.

Governments around Australia are starting to prioritise charging infrastructure. This makes sense because there is a natural role for governments to finance and build this. Governments are also considering various forms of subsidies. New South Wales (NSW) and Victoria have announced a A$3,000 (US$2,194) upfront rebate on EV purchases, for example.

There is also a range of incentives, particularly from the NSW government, that will address fleets. Fleet purchases make up 50 per cent of new car sales.

Large uptake of EVs in the fleet space would eventually trickle down to the second-hand market, where people who can’t afford the price of a new EV would be more readily able to access one of these vehicles.

DI GORI The NSW government recently announced that its own fleet will be entirely made up of EVs by 2030. I don’t think we should underestimate the importance of this: it is the sort of leadership that will also lead to a set of used cars on the road. Having a reasonably priced used vehicle in the market will help consumers transition to electric.

The other benefit of fleet vehicles is that they are well maintained throughout the term of the lease due to the safety standards we need to comply with.