Slow electric vehicle uptake costing Australian economy millions

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Utilities warn Australia’s ‘do nothing’ approach to electric vehicles could cost economy more than $350m over 20 years.

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Australia’s “do-nothing” approach to the uptake of electric vehicles could cost the economy more than $350 million over the next 20 years, a new report has found, at an environmental cost of one million tonnes in added carbon emissions.

Electric vehicle uptake in Australia has been painfully slow, with recent reports suggesting just over 1000 EVs were currently driving Australian roads, representing just 0.01 per cent of the market.

electric vehicle

But research commissioned by the Energy Supply Association of Australia found that the introduction of some basic, low-cost incentives to drive the uptake of alternative fuel vehicles – that is electric vehicles (EVs) and natural gas vehicles (NGVs) – could boost their uptake to almost one million in just 10 years, and lead to more than $1 billion in gross value added over a 20-year period.

It’s encouraging to see that the ESAA is promoting an early-adopter approach to alternative fuels, something it has been less keen to embrace with small scale solar and large scale renewables. But utilities and generators feel they have more to gain from a big uptake in EVs, given that it is likely to add to electricity demand rather than subtract.

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Some of the incentives proposed by the ESAA included such measures as giving the cars access to priority lanes in peak times, access to dedicated parking spaces and requiring vehicle manufacturers to increase the range of vehicles sold into Australia to accelerate and increase the number of models available.

Interestingly, the report said that to achieve optimal economic efficiency, Australia should aim to have 4 million EVs over the next 20 years, with interim targets of 900,000 EVs by 2025 and 2.3 million EVs by 2030.

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The economically efficient target for NGVs was 2 million, or just more than 11 per cent of Australia’s light passenger vehicle fleet by 2035; with interim targets of 85,000 by 2025 and 525,000 by 2030.

But this was unlikely, the report noted, without a comprehensive AFV policy framework federally – an area where Australia is lagging behind many international peers.

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Further failure to take action, the report warned, would have a net cost of $368 million (EVs) and $113 million (natural gas vehicles, or NGVs) to the Australian economy, and require the import of another 30,000 terrjoules of fossil fuels.

“There’s a lot to like about AFVs and what they offer,” said ESAA CEO Matthew Warren in a statement on Monday.

“Apart from the broader economic benefits of the cars of the 21st century, they are cleaner, safer, better performing and cheaper to drive. And they can reduce our dependence on oil imports.”

“We expect this technology to be like solar PV, which, after a slow start, has accelerated significantly over the past decade to a point where we now have the highest penetration rates in the world with 1.4 million homes with solar panels on the roof.

“In the same way once there is a critical mass in the domestic market for alternative fuel vehicles it will bring down costs, support widespread development of charging stations, increase the level of after-sales support and create a re-sale market that will encourage more drivers to buy one.

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12 Comments
  1. john 4 years ago

    EV from a Vehicle sales point are poison.
    Selling a vehicle with no service requirements is not in anyway of interest.
    Perhaps if the batteries were leased this may be a business plan other than that the present situation where service is the cream sales only the side dressing; is the main reason that EV has bugger all interest.

    • Barri Mundee 4 years ago

      Surely there is some service requirement John? The vehicle would still need regular lubrication of some parts, checks of the batteries, tyre and wheel alignment, brakes , power steering, to name a few. I say that without any personal experience of EV’s however.

  2. john 4 years ago

    Because it appears Australia has no minimum consumption guidelines there will be no action in this area.
    The EU and some states in USA have strong guidelines.
    Rather a joke situation considering that AU is considered a perfect country to test new models in due it its varied terrain.

  3. Peter Campbell 4 years ago

    Looks like my wife and I own 0.2% of the Australian fleet! With kind permission, we charge our two electric cars from a neighbour’s unit since our parking area is next to his unit in our set of townhouses. On the weekend we checked the little subsidiary meter I installed and I gave my neighbour $500 to cover the cost of my wife and I commuting in opposite directions for 12 months. If we could park at my unit, which has a time of use meter, we might have only needed to pay $300 for mostly off-peak charging of the two vehicles.

  4. Mark Roest 4 years ago

    The key questions are, can Australia mount a strong education campaign on climate disruption once Abbott is out of the way, and how much does it cost to fill up at the pump? I.E., what are the moral and pragmatic pressures that EVs plus solar can meet? I’m sure EVs are economical now, and the good ones will be highly economical by 2017.

    • Dag Johansen 4 years ago

      EV plus PV is the way to go. Start with PV, it is pretty cheap nowadays. EVs are still dropping in price.

  5. Malcolm Scott 4 years ago

    The premise of 1000 EVs is wrong. 0.01 per cent is correct though. About 2500 EVs are roaming the roads by owners with big smiles on their faces. Surprisingly our growth rate is quite good.

    For those wanting to get on the subsidy bandwagon, in markets that are achieving 1% market share (and perhaps accelerating through that level) the interim incentives total about 1/3 of the vehicle value. For Australia a different approach probably needs to be pursued as we don’t have industry capabilities to support (like US, Canadian provinces, France, Japan, Germany and UK whom we might normally compare ourselves with) nor strategic energy independence (like Norway, Netherlands), or clean air objectives (China, California). We also seem keen on fighting wars and don’t seem to be afraid of the corruption of politics when it comes to fossil fuels, thus there is little motivation to change these things as we waste so much money in Iraq and our concentration camps on Manus and Nauru.

    EV sales are however stimulated by market choice. Australia has little choice. The UK and California have by comparison almost 30 models to choose from. New brands and models have a step change in sales outcomes. As yet no manufacture offers an electric Highlux type competitor in that very dominant portion of the market in many countries. You would have thought that PHEV or Voltec type architectures would be very suitable, but no early movers yet.

    Target EV sales by population is ridiculous – after walking, cycling and public transport are first explored, then this is where EVs fit the task. EVs by population is just continuing with the wrong paradigm. EVs by market share is a better measure – for every vehicle needed, what percentage is zero/ultra low emissions.

    NGV is unacceptable as a fuel source, except perhaps as a short term interim for heavy transport in hybrid and plug-in formats. NGV is not really very low emissions, and moreover it’s just an excuse to justify more pollution at the processing plant – probably another 1M tonnes CO2e in Victoria, which is something we must stop happening. As soon as you go NGV, you are then inviting hydrogen as an energy carrier, which is not free from pollution if you use gas as a source even though the ESAA likes the prospect of more electricity consumption in the gas to hydrogen conversion – it’s just added pollution.

    NG as an alternative fuel is simply not acceptable.

  6. RobSays 4 years ago

    I’m a Leaf driver in the U.S. and I’d like to offer some friendly advice. We’ve made a mess of EV adoption here in the states and you have an opportunity to learn from our mistakes. First, car dealers: quit trying to sell/lease “green” cars. Nobody cares and nobody wants one. EVs are low maintenance, fun to drive and cheap to operate. Second, drivers: LEASE, don’t buy. The technology is changing too fast. If you must buy, buy used. Used & off lease EVs are almost always low mileage and generally less than half the price of new ones. An at home charger is nice, but expensive and you don’t need it. A good electrician can hook you up with Level-2 power for about 1/3 the cost of installing a charger. Finally, government: paying people to drive EVs ultimately doesn’t work. If the infrastructure isn’t right, they will go back ICE the first chance they get and you’re out a bunch of money. The reason people don’t drive EVs is range anxiety. If you want to invest in getting more people drive EVs put your money in upgrading petrol stations and subsidizing other businesses that want to install chargers. We here in America are trying to create a whole separate infrastructure for EVs and for drivers it’s maddening. Put chargers where people are used to filling up so they see they have an alternative choice. Put chargers where they are convenient and visible. Location! Location! Location! Most of the chargers here are hidden or hard to get to. Don’t put chargers where they aren’t accessible 24/7. When people see chargers are commonly available and easy to use, they will start driving more electric cars because they won’t worry about getting stuck with a dead battery. Thanks for reading this far and please learn from our mistakes.

    • JeffJL 4 years ago

      Good to get a response from somewhere that EVs are more accepted than here in Aus.

      I take it that when you say “nobody wants one” you are referring to a “green” car as opposed to EVs in general.

      In Aus the leasing thing is not as mature as in the US. I don’t believe that you can get anywhere near the same level of deals.

      • RobSays 4 years ago

        You’re right. I was trying to type all that out on my phone and I guess my thoughts got ahead of my fingers. To clarify, no one wants a “green” car. Nobody wants to be seen as some whacko tree hugging hippie and that’s what people assume when they hear “green”. Apologies to all my tree hugging hippie friends, but the association in the public’s mind is unfortunate. Everybody I know whose ever driven an EV wants one. Most are just afraid they can’t make it fit their lifestyle.

  7. Dag Johansen 4 years ago

    Get rid of Tony Abbott ASAP.

  8. Ray Murrell 4 years ago

    For your information: Sad as it is,…….
    total passenger car registration figures ( 2,750,000 approx.) from RMA website in NSW show the following
    as at March 31st 2015
    Electric 517
    Hybrid 16269
    as at Dec 31st 2014
    Electric 456
    Hybrid 15927
    In the period DEC to MAR 61 electric vehicles were registered
    54 were new Tesla cars were sold leaving 7 for all the other makes !!!
    EVs are going nowhere!

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