Address to the National EV Summit
I know you join me in celebrating that this Summit occurs on the lands of the Ngunnawal and Ngambri people and in acknowledging their elders past, present and emerging.
As we acknowledge our First Peoples, I’d like to acknowledge two truths:
- Firstly, that there is no inequality that climate change doesn’t make worse. This includes Indigenous disadvantage, whether it be people in sub-standard remote housing or the people of the Torres Strait dealing with the impacts of climate change on their beautiful island homes that I visited recently.
- And secondly, First Nations people must be partners in charting the way forward. I was pleased that my state and territory Energy Minister colleagues agreed with me last week to the development of a First Nations Clean Energy Strategy that will be co-designed with First Nations people.
I’d also like to acknowledge my fellow parliamentary colleagues who are participating today –
- I’m heartened to see so many state and territory ministers on the agenda, because of course they are so critical to electric vehicle uptake.
- Members of the Federal Parliament, both from the Government and the crossbench.
And thank you to the Electric Vehicle Council, Smart Energy Council and the Australia Institute for organising this Summit, but more broadly for your advocacy and policy work to consistently put electric vehicles on the agenda at every opportunity.
Thanks for your advocacy of the need for better policies on electric vehicles against the tide, when the Government of the day didn’t welcome sensible policies. We now have a different dynamic: when we come together and discuss what more we can do together to give Australians access to the best modern transport technology.
Australia now has a Government that gets it. But this is the beginning, not the end. We need collaboration not only across governments but across our country on the challenges and opportunities of climate change. And on behalf of the new Government, I welcome your ideas, engagement and passion on electric vehicles and so much more.
This Summit comes at good time.
A time of hope, that after a decade of denial and delay, after an era of demonisation of innovations like zero emissions cars, after years of frustration, we now have a chance to give Australians access to the world’s best transport technology.
Friends, that hope is well founded.
There is, of course, a strong case for action.
Passenger cars make up almost 10 per cent of Australia’s CO2 emissions. Serious action on climate involves serious action on transport emissions.
We are experiencing significant cost of living challenges. And giving Australians better access to options which allow them to never lift the nozzle on a petrol pump again is a good cost of living measure.
In 2019 the Australian Electric Vehicle Association estimated there would be average annual savings of $500 in fuel and $100 in maintenance costs for every electric car in the national fleet.
And UBS estimates point to projected consumer savings of $1700 per annum by 2030 on the total cost of ownership of an electric vehicle versus internal combustion engine vehicles.
Naysayers point to the expense of electric vehicles – out of the reach of ordinary families – as a reason not to drive further uptake.
And to an extent, they have a point. There are many consumers who would be interested in buying an EV – but even if they could access the limited stock available, price sends them to petrol or diesel models.
What the commentators and naysayers who bag electric vehicles as unaffordable and unavailable in Australia deliberately ignore –
Is that this unaffordability and unavailability is a direct result of policy decisions. In fact, Australian policy failures.
If the intent of electric car policy in Australia has been to limit their availability and make them more expensive than they need to be, then the policy has been successful.
If the intent was to give Australians genuine freedom of choice and access to some of the world’s best, most affordable cars, then it has been a failure.
To me, this is ultimately about choice. Freedom of choice. And policy settings are denying Australians real choice of good, affordable, no emissions cars.
In fact, when asked, more than one in two people said they would consider buying electric for their next vehicle– but the actual number of cars sold shows there are serious barriers which need to be addressed.
At last count, consumers in the United Kingdom could take their pick of 26 low-emissions vehicles under $60,000. In Australia that number is only 8.
This lack of availability has led, unsurprisingly, to a lack of sales.
Just two per cent of cars sold here are electric and plug-in hybrid – compared to 15 per cent in the United Kingdom, and 17 per cent in Europe as a whole.
In fact, Australia’s sales of electric vehicles are at a rate nearly five times lower than the global average.
As the Electric Vehicle Council’s State of the Nation report said - “We need to see more electric vehicle models in Australia, particularly at lower price points. To get more models, we need the right policy settings so we can compete with other countries to attract the globally limited electric vehicle supply to Australia.”
While we are behind the pack Australians are missing out, and without federal leadership we will continue to miss out.
In fact, without action, the situation could get a lot worse.
With other jurisdictions – such as the UK – signalling the banning of sales of internal combustion energy cars, we run a real risk of becoming a dumping ground for cars that are expensive to run and at the back of the global pack.
But on the other hand, there is also cause to be optimistic. Against the odds, with a very unfriendly federal policy setting, Australians have managed to edge up EV and plug in car sales to 2% of total sales, off the appalling base of 0.7% in 2019.
And as I said, Australians are making it clear that they would buy a lot more EVs if there was access to more affordable models.
We know from overseas experience, that with the right policy settings, EV penetration can increase quickly – Sweden, for example, increased its proportion of EV sales from 18% to 62% in two years.
We know from overseas that once you get to 5% sales, EV penetration can increase rapidly, as a critical mass is reached.
So we have a lot of work to do, but I’m very confident the work won’t be wasted.
Now we went to the election with a clear agenda across the board – including on electric vehicles.
Our Driving the Nation plan will –
- Establish a truly national EV charging network - with charging stations at an average interval of 150km on major roads.
- Create a national Hydrogen Highways refuelling network.
- And set a Low Emissions Vehicle target for the Commonwealth fleet of 75% of new leases and purchases by 2025. With thousands of vehicles in the Commonwealth fleet, it is big enough to encourage more EV model introductions to Australia, and to expand a resale market.
And we’ve already acted to make electric cars cheaper through the removal of fringe benefits tax and the five per cent import tariff for eligible electric vehicles.
This is not nothing. In particular, the fringe benefits tax changes mean a model with a sticker price of about $50,000 will be up to $4700 a year cheaper for someone using a salary sacrifice arrangement.
An employer paying for the same model could save up to $9000 a year.
These incentives are critical for fleet buyers and in turn the second-hand market.
We also believe we can and should not only have the ability to drive electric vehicles, but also the capacity to produce them.
My fellow Cabinet Minister, the Minister for Industry Ed Husic is extremely passionate about Australian industry, including us seizing the opportunities involved in the electric vehicle supply chain.
Value adding to our abundant supply of critical minerals and rare earths is a key element of the industry policy that Ed leads. Up to $3 billion of the $15 billion National Reconstruction Fund will be put towards activities including clean energy component manufacturing, and Ed and I fully expect participants in the EV industry to be actively pursuing opportunities for co-investment from that fund.
Our work on battery manufacturing in Australia provides a complementary platform.
Right now, we dig up all the minerals needed to make batteries – but we send most of it offshore for the work to be done elsewhere. It’s a lost opportunity for jobs and investment when there are an estimated 35,000 jobs and $7 billion in value to be made in Australia from battery technology and industries across all sectors.
That’s why Ed and the Government will implement a National Battery Strategy, and establish a Battery Manufacturing Precinct in Queensland.
So, there has been and will be, no shortage of activity in relation to electric cars under the Albanese Government.
But the key to linking all of this activity together is an overarching strategy – and that’s why we are committed to the development of Australia’s first National Electric Vehicle Strategy.
And we are getting ready to – pardon the pun – put the wheels in motion on the development of the Strategy.
Today, I can confirm that we will be releasing a discussion paper during September to inform the development of the strategy. I know I don’t need to encourage this group to put in a submission. But encourage you, I do, nonetheless.
Yesterday, the Minister for Transport, Catherine King, and I wrote to our state and territory counterparts confirming the next steps in the development of a National Strategy and inviting them to be part of the development process. Many of the states have implemented their own agenda, in absence of federal policy, so now is a chance to work together to implement the national settings that have been otherwise missing.
Just as we have partnered co-operatively with my state and territory Energy Ministers to engineer a faster and more orderly transformation to renewable energy, so we will partner with the states and territories as key collaborators on our EV strategy.
Our goals are clear:
- To make EVs more affordable
- To drive more choice in the market
- To drive EV uptake
- To reduce emissions
- To save us money on fuel
- To ensure we are taking advantage of local manufacturing opportunities.
And the EV Strategy will be our roadmap to get there.
I can also announce here today that importantly, the consultation paper will include exploring options for the introduction of fuel efficiency standards.
We believe that now is the time to have a sensible discussion about whether fuel efficiency standards could help improve the supply of electric vehicles into our market, to address the cost-of-living impacts of inefficient cars, and to reduce emissions from the transport sector.
Apart from Russia, Australia is the only OECD country to not have, or be in the process of developing, fuel efficiency standards.
The lack of such standards in Australia is cited as one of the factors impacting the supply and cost of EVs.
Why? Because while Australia doesn’t show leadership, manufacturers prioritise markets which do.
It means consumers aren’t getting the choice available internationally and as the world moves towards more efficient and cleaner vehicles, we risk becoming a dumping ground for older technology which can’t be sold in other markets.
As an example, publicly available analysis published by the Department of Infrastructure under the previous Government indicated a fuel efficiency standard, phased in from 2020, could have already saved motorists up to $1.65 billion in fuel costs.
Had that happened, emissions would have reduced by up to 5.1 million tonnes, and we would be on track to save much more in the lead up to 2030.
This will be a genuine consultation process, and a whole-of-government effort. If the Government does decide to adopt fuel efficiency standards as part of our National EV Strategy, detailed design work will be led by the Department of Transport under the leadership of Catherine King.
But from the outset I will say that while standards must be designed specifically for Australia, standards that lack ambition will still leave us at the back of the global queue for cheaper, cleaner vehicles. We need to aim for as close to best practice as is achievable.
But I think now is the time to have that open and constructive conversation on how we increase the uptake of electric and low emissions vehicles. And once we have had that open and genuine discussion and consultation, once we have worked the details of implementation through carefully, we should proceed with alacrity to begin to turn around the impacts of ten years of denial and delay.
Friends, we know many of the problems.
Lack of charging infrastructure, range anxiety. High costs, long waiting times, lack of availability.
While these are big challenges, and while the solutions to each challenge are different, they all ultimately come back to one thing: policy leadership.
Leadership the Albanese Government will provide.
And, just as we have in the broader climate debate, we will endeavour to provide that leadership in a way which brings Australians together and with us on the journey.
Our “Driving the Nation” policy to have a fast charger every 150km, for example, is designed to ensure Australians in rural and remote areas have real choice when it comes to their next car purchases.
While some in the past have chosen the politics of demonisation and division, the better approach is collaboration and consultation.
Electric vehicles are not and cannot be the preserve of the well off and urban.
We want policy settings that make them available, affordable and attractive to all.
We know we can provide Australians with that choice whilst preserving their ability to enjoy a good weekend away.
We have much to do, together. I look forward to being on this journey with you.