As with the Government's energy policy and its NBN rollout, its plans for electric vehicles – or rather the lack thereof – is another disaster, writes Paul Budde.
WE HAVE HAD former Prime Minister Tony Abbott’s "kill the NBN" policy, Scott Morrison bringing a lump of coal into the Parliament and then-Small Business Minister Michaelia Cash tried to scare Australian ute drivers by proclaiming they would be obliterated by electric vehicles (EVs).
In all these examples, the Coalition Government has put its partisan interests ahead of the country's.
As with all lies, the Government must eventually come clean on these issues. They've now begrudgingly have admitted that EVs can be used for utes and that these utes can even tow caravans.
EV trucks are already next on the program of the manufacturers.
However, because of all this politicking, we are again trailing the world. Of the 36 OECD countries, 32 of them have higher sales rates for electric vehicles than Australia. The only countries with lower electric vehicles sales rates were Mexico, Chile and Turkey, which are classified as emerging economies.
Norway, Iceland and Sweden are leading the charge, with plug-in electric vehicles accounting for 74.8%, 45% and 32.2% vehicles respectively in 2020. Electric vehicles make up only 0.2% of the total vehicle fleet in Australia. Even the "Popemobile" is now an EV.
The International Energy Agency (IEA) suggest that new petrol cars should no longer be sold by 2035. However, several countries are already ahead of this. Madrid's city centre was largely closed for petrol and diesel cars. Amsterdam will ban all petrol and diesel cars from 2030. Diesel cars are banned in many German cities.
In many European countries, public transport and delivery vans must be EVs by 2025.
It is again clear that Australia is the odd one out. In all other western economies, EV incentives are offered during this period of transition. As the uptake takes place, some of those benefits have already been reduced, as the market can start to look after itself.
It is mindboggling that in Australia, even before EVs are making any impact, the South Australian and Victorian Governments are implementing a tax on EVs.
This has been touted by car manufacturers and environmentalists as:
'The worst electric vehicle policy in the world.'
On the other hand, NSW is proposing incentives to buy EVs. The ACT will start a free rego trial for zero-emission vehicles and Victoria will buy EVs for its government fleet.
While the rest of the world is creating new jobs and businesses around the EV innovation, Australia's inconsistent and haphazard approach means we are on track to miss out, further undermining the "greening" of the country.
Once EVs have reached a 50% penetration mark in the market, then we can bring them within the tax regimes we use for cars.
In countries where the market is growing you see more competition, creating lower prices. With no incentives and very little infrastructure investment, there is basically no market for EVs in Australia.
One can't expect car manufacturers to start expensive business setups and marketing campaigns here.
They're currently targeting for the premium side of the market, with many EVs in Australia costing over $100,000. Some other jurisdictions have electric cars, such as Teslas, BMWs, Kias and Hyundais, hovering around the $35,000 to $50,000 mark.
This year, EVs will start to be priced from $15,000 in Europe.
There is also the argument that EVs still rely on the electric grid and as such, they depend on fossil fuels. However, on the issue of carbon emissions, we need to look at this in parallel what is happening in the energy market.
Here, we are seeing a gradual change over from fossil energy to renewables, so over the longer-term energy will largely come from renewables. Therefore carbon emissions will be reduced by using EVs.
Another interesting finding is that electric cars in Europe emit, on average, almost three times less CO2 than equivalent petrol and diesel cars.
One of the major issues in Australia is that we do not have a national energy plan. Further than that, the Government should have a holistic policy and, of course, EVs should be part of that.
I have been involved in the development of smart energy since the mid-2000s. The energy distribution companies were, at that time, all in favour of a transition policy. However, for them to make the transition, laws, policies and regulations needed to be changed so that renewables would become part of their business.
15 years later, this issue has still not been resolved and many companies are moving at a very slow rate.
In fact, the NSW transmission company TransGrid has been arguing for better interconnect regulations with renewable energy sources for over a decade. Based on federal regulations, they were not allowed to do this within their regulated business model.
They finally have bitten the bullet and have started a spin-off company, Lumea, focusing on grid services for renewable energy projects. If there would have been a positive national energy policy, the company would have done this a considerable amount of time ago.
All these issues are linked and need to be solved holistically, not on a project-by-project basis. The lack of government vision creates a process of ad hoc decision-making which is hampering industry certainty, innovation, job growth and the modernisation of the economy and society.
Paul Budde is an Independent Australia columnist and managing director of Paul Budde Consulting, an independent telecommunications research and consultancy organisation. You can follow Paul on Twitter @PaulBudde.
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