The path forward for electric vehicles in Australia

Stakeholder recommendations

APRIL 2016

Founding partners Monash University and The Myer Foundation

PARTNER PROJECT

ClimateWorksA U S T R A L I A

Project partners

About us

The Path Forward for Electric Vehicles in Australia has been prepared by an informal initiative aimed at driving the uptake of Electric Vehicles (EVs) in Australia. The collaboration is convened by ClimateWorks Australia, and draws on input from a range of expert member organisations including Transgrid, NRMA, AGL, the Australasian Convenience and Petroleum Marketers Association, Jet Charge and others, and is working closely with the Electric Vehicle Council.

The following organisations are co-signatories to this submission and support the requested measures outlined to help drive uptake of EVs within Australia to meet our climate, energy productivity and air quality goals:

ClimateWorks Australia: ClimateWorks Australia - an independent, research-based, non-profit organisation committed to catalysing reductions in greenhouse gas emissions in Australia.

Transgrid: TransGrid is the operator and manager of the NSW high voltage transmission network.

AGL: AGL Energy is one of Australia’s leading integrated energy companies providing electricity, gas, solar and renewable energy services to homes and businesses.

Australasian Convenience and Petroleum Marketers Association (ACAPMA): ACAPMA is the leading association and national peak body responsible for the development and growth of the petroleum distribution and petrol convenience retail industries.

JET Charge: JET Charge is a leading supplier, installer and manager of Electric Vehicle Charging Infrastructure.

Electric Vehicle Council: The Electric Vehicle Council is comprised of representatives from academic, industry and corporate sectors, who act as advocates for the adoption of electric vehicles. The Electric Vehicle Council provides a voice to the electric mobility industry transitioning to a progressive, sustainable and secure transport network.

Ergon: Ergon supply electricity to homes and business, and maintain and expand the electricity network in regional Queensland.

City of Sydney: The City of Sydney is the local government authority for central Sydney and surrounds.

Swinburne: Swinburne is a large and culturally diverse organisation with a vision to be Australia’s leading university of science, technology and innovation.

Future Climate Australia (FCA): FCA is a not-for-profit environmental organisation that provides strategies for individuals, business and government to address climate change, particularly in the area of transport and mobility.

Moreland City Council: Moreland City Council’s vision is for a sustainable Moreland that supports a resilient community who live in an attractive, accessible and safe environment, with a strong local economy and services that meet their diverse and growing needs.

Wingmate: WINGMATE provides data logging and analysis solutions in particular for hybrid and electric vehicles.

TR Fleet Australia: TR Fleet Australia provides Modern Fleet Management solutions focussed on Electric Vehicles and Grey Fleet Management

Tritium: Tritium is a Brisbane-based designer, manufacturer and exporter of world-leading charging stations for electric vehicles.

Tesla: Tesla Motors’ goal is to accelerate the world’s transition to sustainable transport with a full range of increasingly affordable electric cars. California-based Tesla designs and manufactures electric vehicles as well as renewable energy storage. Tesla has delivered more than 90,000 electric vehicles to customers worldwide.

Renault Australia: One of Europe’s leading car manufacturers and part of the global Renault-Nissan Alliance.

Adelaide City Council: Adelaide City Council is the capital city council of South Australia with a population of 23,169, founded in 1840 and covering 15.57km².

ChargePoint: ChargePoint holds the exclusive Australian and New Zealand license for electric vehicle charging technology developed by Silicon Valley based company ChargePoint, Inc.

Australian Electric Vehicle Association (AEVA): AEVA is a non-profit organisation founded in 1973, with the purpose to create greater awareness of EVs in Australia.

ClimateWorks acknowledges the contributions of the co-signatories to this report, as well as input from a range of contributors including RACV, Queensland University of Technology, Tom Garrish and Origin Energy.

© ClimateWorks Australia 2016. This work is subject to copyright. Apart from any use permitted under the Copyright Act 1968, no part may be reproduced by any process without written permission from the publisher. Requests and inquiries should be directed to:

ClimateWorks Australia: Level 16, 41 Exhibition Street, Melbourne Victoria 3000 P +61 3 9902 0741 E info@climateworksaustralia.org

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Executive Summary ThePathForwardforElectricVehiclesinAustraliahasbeenpreparedbyacollaborationofindustryrepresentativesfromtheElectricVehicle(EV)ecosystem,toexploretheroleofEVsinreducinggreenhousegasemissions,improvingairqualityandachievingimprovementsinenergyproductivity. ThissubmissionaimstoprovideasummaryofviewsfromacrosstheAustralianEVecosystem,resultingfromindustryandconsumerrepresentativefeedback,anddrawingonresearchandevidencethatsupportsopportunitiestoreduceemissionsatnationalandregionallevels.Researchshowsthatuptakeofelectricvehicles,whenlinkedtoacleanersupplyofelectricity,canprovideemissionreductionsof16and47percentinthePassengerandLightCommercialVehiclesegmentsby2050.ThisimpactsoneofAustralia’sfastestgrowingsourcesofemissions,growingby47.5percentsince1990,representing17percentofAustralia’semissionsandprojectedtorisebyafurthersixpercentto2020,reaching97megatonnesCO2. Inanincreasingrangeofapplications,EVscanprovidecosteffectiveemissionreductions,plusabroaderrangeofeconomicandairqualitybenefits..TheuptakeofEVsalsoaddressesissuesoffuelsecurity,whereAustraliaisuniquelyvulnerabletodisruptionduetothehighfuelimportdependency. InordertosupporttheuptakeofEVadoptioninAustralia,thissubmissionrecommendsaseriesofmeasures,throughthefollowingcategories:

1.TreatmentofElectricVehiclesunderCO2andnoxiousemissionstandards •ProvidingallowancesforloworzeroemissionvehiclesintheshorttermunderCO2emissionstandardstoencouragemanufacturerstoincreasemodelavailabilityacrossmarketsegments •ConsiderationofthebroaderbenefitsofEVstohealth,airquality,fuelsecurity,energyproductivityandelectricitysupplyinanyRegulatoryImpactStatementsundertaken

2.Increasingdemand,awarenessandvalue •Co-ordinatingandincentivisinginfrastructuredeployment,fuelconsumptionlabelling,fleetpurchasingpolicies,aNationalElectricVehicleRoadmap,andLuxuryCarandFringeBenefitTaxexemptions

ThesemeasuresareaimedatsupportingthegreateruptakeofEVsinAustralia,inparticularatearlystagesinordertoincreasemodelchoiceandsupportinginfrastructure.Internationalevidencesuggestsastrongcorrelationbetweensalesandthenumberofvehiclemodelsoffered.ThelackofvehiclechoiceinAustraliasitsalongsidetherelativelyhighpriceofelectricvehiclesinAustralia,whereinternationallyarangeoffinancialandnon-financialconsumerincentivesboostbothsupplyanddemand. ThelackofanationalpolicyframeworkinAustraliahasledtolimitedoverallsupportandincentivesincomparisontoourglobalpeers,whichhascontributedtoourpoorrankingamongmajorOECDcountriesfortheenergyefficiencyofourtransportsector.Whilethereisrecognitionoftheshorttermnatureofsomerecommendations,theyarederivedfromglobal‘bestpractice’vehicleelectrificationstrategiesaimedatneartermuptakeandsupport,toensureAustraliaisreadyforenhanceduptakeofEVsinordertomeetourclimate,energyproductivityandairqualitygoals.

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Summary of requested measures

1. TreatmentofEVsunderCO2emissionstandards

1.1ThatforanylightvehicleCO2standardintroduced,manufacturersareincentivisedtoincreasemodeldiversityacrossmarketsegments.

1.2ThatanyRegulatoryImpactStatementundertakenadequatelyconsiderthebroaderbenefitsofEVsincludinghealth,fuelsecurity,energyproductivity,Australia’sbalanceofpayments,jobsandbroaderbenefitstotheelectricitysupplychain.

2. RoleofEVsinaddressingnoxiousemissions

2.1ThatanyRegulatoryImpactStatementundertakenforEuro5/6considersthepotentialbenefitsEVscanprovidetoreducenoxiousemissions,andconsequentreductionsinexternalities.

3. Complementarymeasurestosupportuptakeofelectricvehicles

Measurestoincreasedemandandtostrengthencurrentunderstandingofthevaluepropositionofloweremissionvehiclesandfuels

3.1ToenhanceshorttermuptakeandincreaseEVmodelavailability,upfrontpurchaseincentives,inlinewiththoseseeninleadingmarkets,shouldbeprovidedacrosstheAustralianmarket.

3.2Aframeworkforoperatingincentivesshouldbedevelopedacrossalllevelsofgovernmentofferingannualregistrationrebates,prioritylanes,reducedparkingetc

Measurestoencouragethesupplyofsupportinginfrastructure

3.3CoordinationofnationalstrategyonEVinfrastructuredeployment: ● UndertakestocktakeofexistingandplannedEVcharginginfrastructuredeployment● Investigateincentivesforcharginginfrastructuredeployment● Considerfuturechargingrequirementsintermsoflikelyfleetmixes● HarmonisechargingstandardsbeforethemassrolloutofEVcharginginfrastructure● EnsuringplanningandinfrastructuredevelopmentisEVready

3.4Workwithotherlevelsofgovernmenttoincentiviseinfrastructuredeployment(e.g.stimulatecharginginfrastructuredeploymentthroughreducingparkinglevyforCBDbasedparkingfacilitieswithEVcharginginfrastructureorreducedparkingratesforcommuterparkingstations,worktoremovelegislativebarrierstokerbsidechargingdeploymentetc.)

3.5Supportlocalbusinessesprovidinginnovationincharginginfrastructuredevelopmentandinnovativedeploymentbusinessmodels

3.6Ensurethatgovernmentfleetcharginginfrastructureisplacedinareas,wherepossible,thatcanalsobeaccessedbythepublic.

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Awarenessraisingandfuelconsumptionlabelling

3.7Supportindustryeffortstofacilitatethedevelopmentofasecondhandmarketforelectricvehiclestoensurethatconsumersnotpurchasinganewvehiclehaveaccesstothistechnology

3.8Supportearlystagedemonstrationanddeploymentofelectricvehicleswithbothgovernmentandbusinessfleetowners

3.9Supportlocalgovernment,consumergroupsandindustryinitiativestoincreaseconsumerexposuretoelectricvehicles

Fleetpurchasingpolicy

3.10TheFederalgovernmentmandatethatnewfleetpurchasesincludeelectricvehicles,andsettargetsforelectricvehicleuptakewithinfleets

3.11Alllevelsofgovernmentworkwithmanufacturerstohelpaggregatedemandforelectricvehicles,encouraginglowerpricesanddeploymentofnewmodelswithintheAustralianmarket

3.12AschemesimilartotheUSDOEsWorkplaceChargingschemebedevelopedtoprovidethetoolsforfleetmanagerstoassesssuitabilityofelectricvehiclesfortheirfleet,benchmarkperformance,sharebestpracticeandpromotethosefleetsactivelydeployingelectricvehicles,raisingawareness

3.13Governmentfleets(alllevels)shouldberequiredtodevelopaplantoreducefleetemissions(CO2,NOxandPM),andproduceanannualpublicreportonprogress

LuxuryCarTax

3.14ProvidefullexemptiontoBEVsfromtheLuxuryCarTaxfrom2016-17,andaddafurtherthresholdexemptionforlowemissionsvehicles(suchasPHEVs),orreplacetheLCTwithanEmissionsTaxforLuxuryVehicles

FringeBenefitsTax/NovatedLeasing

3.15CreateaFringeBenefitsTax(FBT)exemptionforelectricvehiclestoaccountfortheirhighercapitalcostsintheperiodthroughtotheirexpectedpricingparitywithinternalcombustionenginevehiclesin2020-22

3.16EnsurethattheFBTexemptionextendstonovatedleasingarrangements,andextendthisexemptionbeyondthesunsetperiodforthebusinessfleetvehicleexemption

OtherMeasures

3.17FederalGovernmentsupportforthedevelopmentofaNationalEVRoadmapto: ● Establishanationalelectricvehicleuptaketarget● Identifykeyprioritiesandactionsrequiredtodriveuptake● Facilitateconsultationandengagementacrossindustry,consumerandgovernmentstakeholders

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Part One: An overview of EVs in Australia Role of EVs in reducing vehicle emissions in Australia and other benefits

AsasignatorytotheParisAgreement,Australiahasnowcommittedtotheglobaltransitiontonetzeroemissions,requiringthedevelopmentoflong-term2050decarbonisationstrategies. ThePathwaystoDeepDecarbonisationin2050researchbyClimateWorksandANUdemonstratesthatAustraliacouldachievenetzeroemissionsby2050withcontinuedeconomicgrowth,andwithtechnologiesthatarecurrentlyavailable1.ClimateWorksandANUworkedwithCSIROtoidentifydecarbonisationpathwaysforAustraliawhichfocusonmeetingAustralia’scarbonbudgetoptimisedforthelowestcostacrossfourpillars;ambitiousenergyefficiency,lowcarbonelectricity,electrificationandfuelswitchingintransport,industryandbuildingsandsequesteringoffsettingnon-energyandremainingemissions2. ThetransportsectorisoneofthefastestgrowingsourcesofemissionswithinAustralia,increasingby47.5%since19903,howeveritalsorepresentsthemostfinanciallyattractiveemissionreductionopportunityacrosstheAustralianeconomy4.Thetransportsectoraccountsfor17%or92MtCO2eofAustralia’semissionsin2013-14,withPassengerandLightCommercialvehiclescontributing62%ofthesector’stotalemissions5.Thesector’semissionshavebeenprojectedtorisebyafurther6%to2020,toreach97MtCO2e,drivenprimarilybypopulationandincomegrowthforpassengertravelandeconomicgrowthforfreighttransport6. Theimplementationofstandardsaimedtoimprovethefuelefficiencyofconventionalinternalcombustionengines(ICE)willonlygosofarinachievingtheAustralianGovernment'sgreenhousegasemissionsreductiontargets,airqualityobjectives,andimprovementsinenergyproductivity.Demandforhybridelectricvehicles(HEVs)continuestoincreaseandthepathwayleadingtoelectricvehiclesasapredominantvehicle-typeinAustraliawillcontinuetoincludeavastarrayofdifferentdrive-traintechnologiesandfuels.Itishowever,thedevelopmentofpoliciestosupportthebroad-scaleadoptionofnewandemergingtechnologies,inparticularelectricvehicletechnology,thatcouldbringsignificantchangesintermsofnotonlythetechnologiesutilisedforpersonaltransportationbutalsoinmovingeconomiesawayfrompetroleumandlesseningtheenvironmentalfootprintoftransportation. ResearchbyClimateWorksfortheUNFCCCTaskforceinvestigatingAustralia’spost2020emissionreductiontargetidentifiedthatuptakeofelectricvehicles,intandemwithdecarbonisationoftheelectricitygridorsourcingelectricityfromlowcarbonsources,

1ClimateWorksAustralia(2014)2ClimateWorksAustralia(2014)3DIICCSRTE(2013)4ClimateWorksAustralia(2010)5DIICCSRTE(2013)6DCCEE(2010)

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couldprovideemissionreductionsof9MtCO2eby2030,and27MtCO2eby20507.ForthecriticalPassengerandLightCommercialvehiclesegments,thisrepresentsreductionsof16%and47%comparedto2013-14. In2011AECOMcompletedmodellingofelectricvehicleuptakeandimpactswithaspecificfocusontheVictorianmarket.Underascenariosupportiveofelectricvehicleadoption,greenhousegasemissionswerereducedbynearly1.5MtCO2ein2030aspartof$5.5billioninwidereconomicbenefitsfortheVictorianeconomy8.Furthermore,thebreakevenyearfortheeconomicbenefitsarisingfromelectricvehicleadoptionwasbroughtforwardbygovernmentpoliciesdesignedtoencourageelectricvehicleuptake.Thesebenefitsmostlygotoconsumersintheformoflowertransportcosts. TheAECOMmodellingalsohighlightstheairqualitybenefitsarisingfromelectricvehicleadoption.Underthesupportivescenarioalludedtoabove,electricvehicleadoptionin2030wasforecasttodeliverairpollutantreductionsofalmost10,000tonnesofNOxand2,000tonnesofPM10.AccordingtoEPAVictoria,thesefiguresrepresentaround10%ofthe2006inventoriesforthesepollutantsinthePortPhillipregion9.CSIROmodellingfrom2012foundthatelectricvehicleadoptionwillbeconcentratedinmetropolitanareasofVictoria10,wherepopulationdensitiesareattheirhighest.Whenitisconsideredthattheimpactofairpollutiononhumanhealthdependsonwherethepollutionisinrelationtowherepeoplearelocated,electricvehicleuptakehasthepotentialtodelivermeaningfulbenefitstocommunityhealth.

Electricvehicleadoptionalsoaddressesbroaderissuesoffuelsecurity.Australiaisuniquelyvulnerabletoadisruptiontotransportfuelsupplies11duetothecurrentandincreasinglyhighoilandfuelimportdependency,whereAustralia’scombineddependencyoncrudeandfuelimportsfortransporthasgrownfromaround60%in2000toover90%today12.Inadditionthereiszerogovernmentownedormandatedstocksandtransportfueluseisprojectedtoincrease,growingsteadilyatanaveragerateof1.3%ayeardrivenlargelybyeconomicgrowth13. AustraliaisamemberoftheInternationalEnergyAgency(IEA)asasignatorytotheInternationalEnergyProgram(IEP)Treaty,whichhasarequirementtoholdtheequivalentof90daysofthepreviousyear’snetimports14.IncreasingdemandforoilandpetroleumproductsalongwithdecliningindigenousoilproductionhascreatedashortfallagainstAustralia’sIEPTreatystockholdingcommitment.Amulti-agencytaskforcehasbeenestablishedtodevelopoptionstoinformadecisiontoresolveIEPTreatynon-compliance15. Analysisisbasedonthe2050PathwaysCalculatordevelopedbyClimateWorks,inpartnershipwithNRMAandwithfundingfromARENA,presentsanoverviewofthepotentialoptionstoreducedemandforimportedoilandfuelinAustralia,andthebenefitsthisprovidestonationalfuelsecurityandcarbonreductiontargets.WiththeincreaseofelectricvehiclesintotheAustralianfleetbroadlyconsistentwiththeDeepDecarbonisationPathwaysProject,stocksoffuelwouldincreasefrom18to21daysin2030andfrom16to20daysin2050.Oil/fuelimportswoulddecrease16percentagepointsin2030and28percentagepointsin2050.

7ClimateWorksAustralia(2015)8AECOM(2011)9EPAVictoria(2011)10CSIRO(2012)11Blackburn(2015)12Blackburn(2014)13BureauofResourcesandEnergyEconomics(2014)14InternationalEnergyAgency(2012)15DepartmentofIndustry,InnovationandScience(2016)

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Figure1:Australia’sfuelsecurityintermsofoilstocksandratioofimportedoil,underbusinessasusual(left)andunderdeepdecarbonisationEVuptakeassumptions(right)

Source:ClimateWorksanalysis(2016) IncreaseduptakeofEVswithinAustraliaalsopresentsapotentialopportunitytoincreaselocalemploymentopportunities.Employmentwillbecreatedpotentiallythroughsales,charginginfrastructuredeployment,andpotentialopportunitiestocreatenewmanufacturingjobsspecialisinginbatteries,EVcomponentsorcharginginfrastructuretechnologies.Therewillalsobepotentialincreasedemploymentandeconomicbenefitsfromtheincreaseddemandforlocallyproducedelectricity,replacingthepredominantlyimportedpetroleumbasedfuels. By2050,electricvehiclesandbiofuelscouldreverseincreasingtransportfuelimports,aswellasreducingcosts,improvingairquality,reduceIEPcompliancegapandreducinggreenhousegasemissions16. Current state of play – EVs in Australia and our global peers Globalelectricvehiclestockiscontinuingtoincrease,risingfromabout180,000electriccarsontheroadinlate2012toover665,000ontheroadattheendof201417.Approximatelytwo-thirdsofofglobalelectricvehiclestockislocatedinjustthreecountries,theUnitedStates(39%),Japan(16%)andChina(12%).Early-adoptermarketssuchasCaliforniaandNorwayaremovingtowardsmainstreamadoption,whilefast-followermarketssuchastheUnitedKingdomarebuildingonthelessonslearnt18. Figure2:Annualglobalelectricvehiclesales

Source:InternationalCouncilonCleanTransportation(2015)

16CSIRO(2015)17CleanEnergyMInisterial(2015)18InternationalEnergyAgency(2014)

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Thenumberofelectricvehiclessoldeachyearisgrowingrapidly,increasingfrom45,000electricvehiclessoldin2011tomorethan300,000in2014.In2014intheNetherlands,Norway,SwedenandtheUnitedStates,electricvehiclesrepresentedmorethan1%oftotalnewcarsales19. Inaddition,vehicleelectrificationhasalsogonemulti-modal,with46,000electricbusesand235millionelectrictwo-wheelersdeployedbytheendof201420.Chinaiscurrentlyleadingthemulti-modaldeployment,with230millione-bikes,83,000electriccars,and36,500e-busesontheroadin201421. Comparatively,electricvehiclesalesinAustraliain2014totalled94822representingapproximately0.32%ofglobalelectricvehiclemarketshare.Oftheapproximately1.08millionnewvehiclessoldin2014,thisrepresentslessthan0.09%oftheAustralianmarket. Numerousstudieshavebeenconductedthatmodelandforecastthedeploymentofelectricvehiclesalesundervariousmarketandpolicyconditions,howeverprojectionsofpotentialincreasesinelectricvehiclesalesvarygreatly,dependingonregionaswellaspolicydrivers,technologyprogress,marketconditions,andotherfactors. Figure3belowsummarizesprojectionsfromnumerousstudiesthatanalysedfutureelectricvehicledeployment23.Generally,studiesthatassumedgreatertechnicaladvancementsuchasinbatterytechnologyandincreasedpolicysupportinareassuchasR&D,infrastructure,andregulation,foundthat20%tomorethan50%electricvehicleshareswerepossibleinleadingelectricvehiclemarketsinthe2025-2030timeframe24.Alternatively,studiesthatfactoredinlesserpolicysupportandlessertechnicaladvancementgenerallyfoundthattheelectricvehiclemarket,invariouscountriesandglobally,couldremainaslowas5%-10%inthe2025-2030timeframe25. Figure3:Electricvehicle2010-2014salesshareforselectedregionsand2020-2030salesshareprojectionsforU.S.,EU,China,Japan,andtheworldfromvariousstudies

Source:InternationalCouncilonCleanTransportation(2015)

19InternationalEnergyAgency(2015)20InternationalEnergyAgency(2015)21InternationalEnergyAgency(2015)22NationalTransportCommission(2015)23InternationalCouncilonCleanTransportation(2015)24InternationalCouncilonCleanTransportation(2015)25InternationalCouncilonCleanTransportation(2015)

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AsummaryofelectricvehicleadoptionprojectionsispresentedbelowinFigure4.Thetophalfoftheprojections,downtoandincludingHigginsetal,areallbasedontheCSIROEnergySectorModel.ThisincludesamodeloftheAustralianroadfleetandassumesinvestmentchoicesarebasedprimarilyoneconomicmeritbutalsoincludessomeadditionalconstraintssuchaslimitsontheshareofshortrangevehicles26.NotingalsothattheEnergySectorModelincludestheuseofelectrictrucksintherigidtruckfleetwhiletheremainingreferencesgenerallydealwiththepassengervehiclemarketonly. Ifelectricvehiclesbecomeeconomicallyviablethereisnorealupperlimitontheiradoptionexcepttherateofturnoverofthevehiclestock.ThroughtheCSIRO’sFutureGridForum,itwasclearthatthereisalotofuncertaintyintermsofforecastuptakeratesofelectricvehicles,andthatthehigherendprojectionsarefeasiblegiventhepotentialappealofthetechnology,andthesignificantadvancesinbatterytechnology.Thescenariopresentedbelowwithhigheruptakerates,modelledbyCSIROforClimateWorks’DeepDecarbonisationPathwaysProject,isreflectiveofaworldthatiscommittedtomeetingtheemissionreductioncommitmentsoftheParisagreement,andhighlightstheimportantrolethatelectricvehiclesplayinhelpingAustraliameetitscarbonbudgetto205027.Figure4:ProjectionsofelectricvehiclefleetsharesinAustralia

Source:EnergyNetworkAssociationandCSIRO(2015) 26EnergyNetworkAssociationandCSIRO(2015)27ClimateWorksAustralia(2014)

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Internationalevidencesuggestsastrongcorrelationbetweencumulativeelectricvehiclesalesandthenumberofvehiclemodelsbeingoffered,withthegreaternumberofmodelsavailableincreasedconsumerchoicecanleadtofurtherincreasesinsales28.In2012,therewere6to8electricvehiclemodelswidelyavailabletothegeneralpublicinseveralcountries.Thishasincreasedtoover30in2015,dependingongeographicallocation29.Whilemostleadingcarmanufacturershaveoneormoremodelsinproductionordevelopment,theavailabilityofmodelsisdependentongeographiclocationandmarketdemand. InAustraliathereiscurrentlyalimitednumberofmodelsavailable,outlinedinTable1below30.Notableomissionsincludethehighestsellingelectricvehiclesfrominternationalmarkets,includingtheNissanLEAFGen2,ChevroletVoltandBolt(notbeingbuiltinrighthanddrive),andRenaultZOE.NissanintroducedtheGen1LeaftotheAustralianmarket,butisnotplanningonbringingtheGen2versionwhichisnowavailableinothermarkets.NissanAustraliaCEO,RichardEmery,haspreviouslystatedthatmanufacturersneed“governmenthelp,thesamekindofassistancethatgovernmentsinEurope,theUSAandJapanprovide”toovercomebarrierstoEVuptakeinAustraliaandincreasemodelavailability31.Inanintensely-competitivemarketcontainingover400passengerandlightcommercialvehicleoptions,thereareamere14plug-inmakes/models.Furthermoreacrossthe30vehiclesegmentsandover1.1millionnewvehiclesales,plug-inoptionswereavailableinjust12segmentsaccountingforlessthan20%ofthemarket32.ThismeansthatfortheoverwhelmingmajorityofAustralianbuyers,plug-invehiclesarenotevenavailable.Table1:AustralianEVmarketoutlookfor2016

Source:ClimateWorksAustraliaanalysisTable1illustratestheavailabilityofmodelsinAustraliain2016.Thelackofchoice(lowmodeldiversity)isclearinallcolumnsandthelackofchoice-especiallyinlowercostvehicles–isclearinallrows.AddressingthesetwoweaknessesisfundamentaltoincreasingadoptionoftheseclassesofvehiclesinAustralia. EuropeisdrivingchangeinthisareabyrequiringtotalfleetCO2emissionsforanOEMtodropeveryfewyears.OEMsachievedtheirCO2-by-vehicle-masstargetsfor2015,inmostcasesseveralyearsinadvance.Thenexttargetsarein2020and2025andOEMsareexpectedtoachievethesetargetsthroughplanningandroll-out(sale)ofasuitablemixofvehicles.Aspetrol/dieselwillnotachievesuchtargetsinfutureontheirown,anincreasingmixofPHEVsandBEVswillhavetobesoldbyOEMstoachievethetargetsinordertoavoidthesignificantfinancialpenaltieswhichwouldaccompanysuchfailure.Thisisillustratedbythediagrambelow,whichshowsthatanincreasingproportionofBEVsandPHEVs(aswellasHEVs)willberequiredtoachievefuturetargets.

28InternationalEnergyAgency(2015)29EVObsession(2016)30ElectricVehicleCouncil(2016)31Motoring.com.au(2015)32FederalChamberofAutomotiveIndustries(2015)

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Figure5:CO2emissionsofselectedcommerciallyavailablepassengercarmodelsintheEUin2013

Source:ICCT2014 OEMswilleachhavetodevelopasuitablemixofvehiclestoachievetheseEuropeantargets.AustraliacanbenefitfromthisdevelopmentbysimplyfollowingthetrajectoryoftheEuropeanexperience.EventheEuropeantargetdatescanbefollowedasAustralianOEMswillsoonnotmanufacturelocallyanymoreandthenexttargetdate–in2021–maybesufficientlyfaraheadtogivelocalOEMstimetoadjust.ThislackofvehiclechoicesitsalongsidetherelativelyhighpriceofelectricvehiclesinAustralia.Keyinfluencesincludetheshippingcostsfromdistantproductionfacilities,andthefixedcostsassociatedwithlocalmarketintroduction(e.g.ADRcompliance/homologation;sales,distributionandserviceinfrastructure)thatmustbeamortisedacrosslowsalesvolumes.TheoutcomeisanegativefeedbackloopforAustralianvehiclesellersandbuyerswhoareexposedtohigherinvestmentrisksthantheirinternationalcounterpartsandrespondaccordingly. Internationally,arangeoffinancialandnon-financialconsumerincentivestoboostbothsupplyanddemandforEVshavebeenutilised;includingsupportforEVcharginginfrastructure,upfrontrebatesortaxcredits,discountedtollsandparkingfares,aswellaspreferentialparkingspaces,accesstorestrictedhighwaylanes,andexpeditedpermittingandinstallationofchargingunits. Anumberofinternationalelectricvehiclesupportpoliciesdeliversignificantdirectincentivesforconsumers,orsignificantindirectincentivesthroughfueleconomystandards33.Countriesthathavealeadingmarketshareofelectricvehiclesaleshaveintroducedupfrontfinancialincentives;intheformoftaxbreaks,stampdutydiscountsanddirectsubsidiestoassistconsumersinovercomingthehigherpurchaseprice34. DirectvehiclesubsidiestotheequivalenttoUS$12,000pervehicleforbatteryelectricandplug-inhybridelectricvehiclesareofferedinChina.TheNetherlandscurrentlyoffersthehighest

33Energeia(2016)34Energeia(2016)

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levelofelectricvehicleincentivethroughstampdutyexemptions,andNorwaygrantsafullexemptiontothe25%ValueAddedTax(VAT)forthepurchaseofbatteryelectricvehicles.WhiletheseincentiveshaveallowedelectricvehiclespurchasedintheNetherlandsandNorwaytoachieveorexceedpurchasepriceparitywithequivalentICEvehicles35,ithasbeenreportedthattheresomeoftheseincentivesmaybewoundback36. Whilethereisrecognitionthatincentivesareatemporarysolution,intheshorttermtheyareaidingelectricvehiclemarketdevelopmentandarea‘bestpractice’strategyinsupportingglobalvehicleelectrificationefforts.Inconsideringbestpracticeincentives,thereisaneedtocontextualisepotentialincentivestoensurethebestfittomeettheneedsofagivencountryorcity37.Table2:Summaryofgovernmentelectricvehiclepromotionactionsinselectedareas

Source:InternationalCouncilonCleanTransportation(2015)

35Energeia(2016)36TheNorwegianGovernmentintroducedincentiveswiththeaimofputting50,000electriccarsontheroadsby2017;howeverthistargetwasmetinApril2015,twoyearsaheadofschedule.Norwaynowintendstograduallyrampdownincentivescompletelyby2020(Gordon-Bloomfield(2015)).37InternationalEnergyAgency(2015)

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Australiadoesnotcurrentlyhaveanationalelectricvehiclepolicyframeworkandthereislimitedoverallsupportandincentivesincomparisontoourglobalpeers.Therehasbeenpolicyactivityatastateandlocalgovernmentlevel,howeveroverallpolicyhasbeenlimitedtomodestregistrationdiscountsandpartialsupportforpubliccharging38.ThetablebelowoutlinescurrentelectricvehiclepolicysupportmeasuresinAustralianstatesandlocalgovernments. Table3:CurrentelectricvehiclepolicysupportmeasuresinAustralianstatesandlocalgovernments

Source:Energeia(2016)

Despitetheadvancesthatvehicleelectrificationhasmadeinrecentyears,therearestillsignificantbarriersthatstandinthewayofwidespreadadoption;technological,financial,market,andpolicychallengescouldhindermarkettransformationifnotaddressedthroughfurtherRD&Dinvestments,public-privatecollaboration,andinnovativepolicyandbusinesssolutions39. Economicviabilityremainsthemostseriousbarrierandsourceofuncertaintyinprojections.Thedifficultyforforecastinguptakeliesinthechickenandeggparadox;electricvehicleswillbecostcompetitivewhenscaleinmanufacturingisreached,howeverlargescaleconsumeruptakewillonlyoccurwhenelectricvehiclesarecostcompetitive40.Incentiveshavebeenusedtoovercomethischickenandeggproblem,andhasworkedtoachieveanincreaseinglobalelectricvehicleproductionby50percentto300,000perannumin201441.

38Energeia(2016)39InternationalEnergyAgency(2015)40EnergyNetworkAssociationandCSIRO(2015)41EnergyNetworkAssociationandCSIRO(2015)

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Table4:Electricvehicleadoptionbarriersandpolicyactions

Source:InternationalCouncilonCleanTransportation(2015) WiththeconsiderationofissuesassociatedwiththeimplementationofCO2emissionstandardsandmorestringentstandardsfornoxiousairpollutantemissions,anopportunityexiststoestablishbestpracticepoliciestosupportuptakeofelectricvehiclestoreduceoilconsumption,climate-relatedemissions,localairpollutionandtotakealeadershippositioninnewadvancedtechnology42.

42InternationalCouncilonCleanTransportation(2015)

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Part Two: Response to issues raised in the Discussion Paper Treatment of EVs under CO2 emission standards AustraliaisoneofthefewremainingdevelopedcountrieswithoutlightvehicleCO2emissionstandardsinplace,withstandardscoveringover80percentoftheglobalautomotivemarket43includingmanydevelopingnationssuchasChina,Brazil,IndiaandMexico.Thishasmeantthatincomparisontoourglobalpeers,Australiahasscoredpoorlyintheenergyefficiencyofitslandtransportsector.TherecentAmericanCouncilforanEnergy-EfficientEconomy(ACEEE)InternationalScorecardrankedAustralialastoutof16majorOECDcountriesfortheenergyefficiencyofourtransportsector44. Whilstfuelefficiencystandardsvaryintheirambitionanddesignbycountry,ingeneraltheysetaverageCO2emissionlevelswhichamanufacturermustmeetacrossitsannualfleetofnewvehiclesales.Emissionsarecalculatedusingarangeofvehicletestcycles,andpolicydesignmayincludeexemptionsformanufacturerswhosellsmallvolumesorcreditsforcertainverylowemissionsvehicletechnologies,suchaselectricvehicles. Whenconsideringthestructureofbestpracticestandardsfromourglobalpeers,theEUandUnitedStatesstandardspresentopportunitiesforlearning. IntheEU,legislationsetsmandatoryemissionreductiontargetsfornewvehicleswiththetighteningoftargetseveryfiveyears.Emissionlimitsaresetaccordingtothemassofvehicle,usingalimitvaluecurvewhichallowsheaviervehiclestohavehigheremissionsthanlightercars.Onlythefleetaverageisregulated,somanufacturersarestillabletomakevehicleswithemissionsabovethecurveprovidedthesearebalancedbyvehiclesbelowthecurve45.IftheaverageCO2emissionsofamanufacturer'sfleetexceedsthelimitvalueinanyyearfrom2012,themanufacturerisrequiredtopayanexcessemissionspremiumforeachadditionalvehicleregistered. Thestructureofthelegislationalsoallowsadditionalincentives,knownas‘supercredits’,formanufacturerstoproducevehicleswithextremelylowemissions,below50gCO2/km.Lowemissionvehiclesarecountedas3.5vehiclesin2012and2013,2.5in2014,1.5in2015and1vehiclefrom2016to201946.Super-creditswillalsoapplyinthesecondstageofemissionreductions,from2020to2023.Duringthisstage,eachlow-emittingvehiclewillbecountedas2vehiclesin2020,1.67in2021,1.33in2022and1vehiclefrom2023.

43InternationalCouncilonCleanTransportation(2015)44AmericanCouncilforanEnergy-EfficientEconomy(ACEEE)(2014)45EuropeanCommission(2016)46EuropeanCommission(2016)

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AlternativelyintheUnitedStates,incentivesforelectricvehicles,plug-inhybrids,fuelcellvehiclesandcompressednaturalgasvehicleshavebeenputinplacetofacilitatemarketpenetrationofthemostadvancedvehicletechnologiesasrapidlyaspossible. TheUSEnvironmentalProtectionAgencyhasdevelopedanincentivemultiplierforcompliancepurposesforallvehicleswithadvancedtechnologiessoldfrom2017throughto2021.Thismultiplierapproachmeansthatforapprovedvehicles,eachonesoldwouldcountasmorethanonevehicleinrelationtothemanufacturer’scompliancecalculation.Electricvehiclesandfuelcellvehicleswillcommencewithamultipliervalueof2in2017,phasingdowntoavalueof1.5by202147.Plug-inhybridsandcompressednaturalgasvehicleswillstartatamultipliervalueof1.6in2017whichwillphasedowntoavalueof1.3in2021.Therearenomultipliersfrom2022to202548. Forelectricvehiclesandplug-inhybridvehicles,theEnvironmentalProtectionAgencyissettinga0gCO2/miasthetailpipecompliancevaluefrom2017to2021,withnolimitonthequantityofvehicleseligiblefor0gCO2/mitailpipeemissionsaccounting.From2022to2025,0gCO2/miwillonlybealloweduptoaper-companycumulativesalescapof600,000vehiclesforcompaniesthatsell300,000electricvehiclesorplug-inhybridvehiclesin2019to2021,or200,000vehiclesforallothermanufacturers.Forsalesabovethesethresholds,manufacturerswillberequiredtoaccountforthenetupstreamGHGemissionsfortheelectricportionofoperation49. TheGovernmenthastheopportunitytointroducebestpracticestandards,whichifdesignedwellincollaborationwithindustryandconsumerstakeholders,andsupportedwithsuitablecomplementarymeasures,presentasignificantopportunitytoreduceemissionsfromthetransportsectorwhilstprovidingbroaderbenefitsforvehicleownersandtheeconomy. IfAustraliaweretotargetthesamelevelsoffueleconomyimprovementinleadingmarkets,a50percentimprovementover10years,andasa‘technologytaker’withanincreasinglylargeproportionofourfleetsourcedfrommarketswithstandardsalreadyinplace,AustraliacanexpecttoreplicatetherateofimprovementinashortertimeframethanpreviouslyseeninmarketssuchastheUnitedStatesandEurope.Conversely,inthecontinuedabsenceofCO2emissionstandards,Australiarunstheriskofbecomingthedumpinggroundforlow-specificationmodelsandfallingfurtherbehindinternationalpeers,resultinginrelativelyhigherfuelcostsformotoristsandbusinesses. Figure6:GlobalcomparisonofCO2emissionandfuelconsumptionstandards

Source:GlobalFuelEconomyInitiative(2015)

47UnitedStatesEnvironmentalProtectionAgency(2012)48UnitedStatesEnvironmentalProtectionAgency(2012)49UnitedStatesEnvironmentalProtectionAgency(2012)

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IfAustraliawereabletoachievea50percentimprovementonfueleconomyfornewlightvehiclesover10yearsequatingto130gCO2/kmin2020,and95gCO2/kmin2025,therewouldbefinancialbenefittoconsumersthroughreducedfuelbills.ClimateWorks’analysisshowsthatnetannualsavingsofapproximately$350foraveragedriversofconventionalinternalcombustionenginevehiclesoverafiveyearownershipperiodcouldbeachieved,andeconomywidethesefuelssavingswouldtotalalmost$8billionperyearby202550. Forelectricvehicleshowever,highercostsavingscanbeachievedoverthelifeofthevehicleduetoincreasedfuelsavings. Figure7:Incrementaltechnologycostofelectricandconventionalvehiclesthrough2025

Source:InternationalCouncilonCleanTransportation(2015) Theintroductionofstandardswithsupportivemeasuresforloworzeroemissionvehiclesasseeninothermarkets,wouldalsoincentivisemanufacturerstointroducenewmodelsofelectricvehiclesintotheAustralianmarket,asameanstohelpmeetaveragefleetemissionstargetswiththeflowonbenefitofincreasingconsumerchoice. Althoughelectricvehicleshavezerocarbondioxidetailpipeemissions,theremaybecarbondioxideemissionscontributedfromelsewheredependingonthenatureofthesourcepower51.InSouthAustraliaandWesternAustralia,EVsusinggridenergywilldeliveremissionsreductionsrightnow.InTasmania,whichusespredominantlyhydro-electricity,EVsmayactuallybe‘zeroemissions’driving.ConverselyinVictoria,evenwithexpectedimprovementsingridemissionsintensity,EVsmaybeworsethanICEVequivalentsforsometimetocome52. Inordertodemonstratetheimpactonemissionsofelectricvehiclesunderdifferentemissionintensitiesoftheelectricityusedtochargethem,ClimateWorkshaspreparedtheanalysispresentedinFigure7.ThispresentstheequivalentCO2emissionsforatypicalEV,theGen1NissanLeaf,undertwodifferentgridemissionintensityscenarios.ThefirstscenarioisaBAUscenarioforAustralia’sNEM,basedonrecentanalysisundertakenforthe2014RenewableEnergyTargetReview53,whichfactorsincurrentpolicysettings.ThesecondscenarioisbasedonCSIROmodellingundertakenfortheDeepDecarbonisationPathwaysProject,whichgraduallydecarbonisingthegridtomeetAustralia’scarbonbudgetoutlinedbytheClimateChangeAuthority. 50ClimateWorksAustralia(2015)51NTC(2015)52VictorianGovernmentDepartmentofTransport(2012)53ClimateChangeAuthority(2014a)

17

WhatthisshowsisthatbasedoncurrentNEMaverageemissionintensity,aNissanLeafhasloweremissionintensitythantheaveragenewcarsoldinAustralia,andalsolowerthantheMazda3,Australia’stopsellingvehicle.Italsoshowsthatoutto2025,aNissanLeafusingNEMaverageelectricity,willperformbetterthantheprojectedBAUaverageforanewpassengerandlightcommercialvehicle.ThisisimportantintermsoftiminggivenprojectionsformainstreamuptakeofEVspost2020.Underadecarbonisationscenario,aNissanLeafwilloutperformaToyotaPriusHybridfrom2020,andachieveemissionintensityofbelow30gCO2/kmby2030.Figure8:EmissionsintensityofelectricvehiclesbasedonAustraliangridemissionsforecasts

Source:ClimateWorksAustraliaanalysis Whatthisalsoshowsisthatwhenpoweredbyrenewableelectricity,EVscanachieve‘zeroemissions’,whichisavailabletoday.ManyoptionsexisttolinkEVstorenewableenergysources,suchascarbonoffsets,includingcertificationagainsttheNationalCarbonOffsetStandard,andGreenPoweraremarket-mechanismsthatallowEVchargingdemandtobereconciledagainstrenewablegenerationsources.InexpensivesoftwaresolutionsallowEVchargingloadstobecoordinatedinlinewithrenewableenergygeneration.Businessmodelinnovationcombinedwithgrowingconsumerawareness,understandingandacceptanceofthetechnologywillallowEVstobefullyutilisedthroughcompleteintegrationintotheNationalElectricityMarket. Overseasexperienceshowsthat,whilemandatoryfuelefficiencystandardsarekeytoachievingemissionsreductionsinpassengerandlightcommercialvehicles,thesereductionscanbeenhancedwitharangeofcomplementarymeasureswhicharedetailedinasubsequentsection.

Requested measures: ● ThatforanylightvehicleCO2standardintroduced,manufacturersareincentivisedto

increasemodeldiversityacrossmarketsegments.● ThatanyRegulatoryImpactStatementundertakenadequatelyconsidersthebroader

benefitsofEVsincludinghealth,fuelsecurity,energyproductivity,Australia’sbalanceofpayments,jobsandbroaderbenefitstotheelectricitysupplychain.

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Role of EVs in addressing noxious emissions Vehiclessignificantlycontributetolevelsofhydrocarbons,oxidesofnitrogen,carbonmonoxideandparticulatematterintheair,whichcanadverselyaffectacuteandchronichealthconditions54. InEurope,noxiousemissionstandardsvarydependingonwhetherthevehicleusespetrolordiesel,aswellastheclassofthevehicle.TheEuro5standardimplementedinEuropeappliedtothesaleofallnewvehiclesfromJanuary2011untilSeptember2015.FromSeptember2015,allnewvehiclessoldinEuropemustbeEuro6compliant.TheimplementationoftheEuro6standardwillreduceNOxemissionsbyafurther55%55,andwilllimitoverallemissionsofdieselandpetrolvehiclesclosetoparity,providedthatvehiclesofbothfueltypesconformtostandardsinreal-worlddrivingconditions56. IntheUnitedStates,thestandardsappliedwhicharereferredtoastheTier2program,aremorestringentthanEuro6.TheTier2programsetsoutthestandardsfortailpipeemissionsforallpassengervehiclesandstipulatesafleetaverageNOxcloseto40mg/kmforbothdieselandpetrolengines57.TheTier2programwillbereplacedatthebeginningof2017withthestricterTier3standards. Australia,likemanyothercountries,hashadvehiclestandardstoreduceairpollutantsinplacesincetheearly1970s,andexistingvehicleemissionsstandardsaresetbyAustralianDesignRules(ADRs)whicharelegislativeinstrumentsundertheMotorVehicleStandardsAct198958.In2011,theadoptionofstrongeremissionsstandardswasannounced,withthefirststagebeingtheEuro5standardsbeingfullyimplementedin2016.ThesestandardsmirrorthoseadoptedbytheEuropeanUnion,butonastaggeredtimeframe59. WiththeimplementationoftheEuro5standardinAustralia,theamountofparticulatematterfordieselvehiclesfromthepreviousstandardsshouldbereducedby80%orfrom25mg/kmto5mg/km,andby28%forNOxemissionsorfrom250mg/kmto180mg/km60.TheadoptionofEuro5standardshasforcedtheuseofdieselparticulatefiltersforlight–dutydieselvehicles. ApreviousRegulatoryImpactStatementconductedbytheDepartmentofInfrastructureandTransportreviewedtheimplementationofEuro5and6lightvehicleemissionstandards.Thebenefit-costanalysisdemonstratedanoverallnetbenefitinadoptingtheEuro5/6emissionsstandardsforthenewlightvehiclefleet.TherearecostsassociatedwithshiftingfromEuro5toEuro6relatingtocompliance,howeverestimatingactualcostscanbedifficult.Asaguide,theEuropeanCommissionestimatedanaveragecostincreaseof$980foradieselvehicletocomplywithEuro6standardsrelativetoEuro4.Ifthesecostwerefullypassedontotheconsumer,thiswouldrepresentapriceincreaseofaround4.5%fora$22,000vehicleand2.5%fora$40,000vehicle61.Inaddition,themagnitudeofthebenefitwasalsoinfluencedbykeyassumptionsincludingavoidedhealthcosts,thevalueofastatisticallife,thelengthoftheanalysisperiod,thestartdateforthestandardsandthediscountrate.

54ClimateChangeAuthority(2014)55AirClim(2012)56InternationalCouncilonCleanTransportation(2015)57UnitedStatesEnvironmentalProtectionAgency(2016)58DepartmentofInfrastructureandRegionalDevelopment(2014)59ClimateChangeAuthority(2014)60Mortimore(2015)61DepartmentofInfrastructureandTransport(2011)

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Inconsideringthepotentialcostsassociatedwiththepurchaseofmoreefficientvehicles,theupfrontcapitalcostsandlifetimecostbenefitsofanelectricvehiclecouldbecomemoreattractive.Inadditionandinconsideringthepurposeofnoxiousemissionstandards,electricvehiclesprovideazeroemissionsolution.Table5belowprovidesacomparisonofEuro5andEuro6emissionlimitsbyvehiclefuelsource. Table5:ComparisonofEuro5andEuro6emissionlimitsbyvehiclefuelsource

Source:DepartmentofInfrastructureandRegionalDevelopment(2015)andClimateWorksAustralia(2015)

Complementary measures to support uptake of electric vehicles Basedontheresultsofvariousgovernmentactionspromotingelectricvehiclesandrecentresearchoneffectivepolicies,somebasicprinciplesareemergingregardingelectricvehiclepolicy.Complementarymeasuresandelectricvehiclepoliciesareideallytargetedathelpingovercomeknownpotentialbarrierstoprospectiveelectricvehicleusers;includingincrementalvehiclecost,vehiclerange,lowerresidualvalues,vehiclerechargetime,andconsumerawarenessregardingelectricvehicleownershipbenefits.Manycountriesareseekingtoovercomethesebarriersandpromoteelectricvehicletechnology,mobility,andsales62. Thissectionprovidesanoverviewofelectricvehiclespecificincentivesthatarecurrentlyinplaceintheinternationalmarket,considerationfortheeffectivenessoftheseincentivesandhowthesecouldbebestappliedintheAustraliancontext.

62InternationalCouncilonCleanTransportation(2015)

Level Euro5 Euro6

Emission Petrol/ LPG

Diesel Electric Petrol/ LPG

Diesel Electric

OxidesofNitrogen

60 180 0 60 80 0

Particulates 4.5(fordirectinjectionpetrolengines)

4.5 0 4.5(fordirectinjectionpetrolengines)

4.5 0

Requested measures: ThatanyRegulatoryImpactStatementundertakenforEuro5/6considersthepotential

benefitsEVscanprovidetoreducenoxiousemissions,andconsequentreductionsinexternalities.

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Well-designedfinancialincentivesforconsumersatthenationalandlocallevelsareloweringupfrontcostsforelectricvehicles,increasingsalesandinfrastructuredeploymentinanumberofglobalmarkets.Thesetypesofincentivesarenotonlyofbenefittoearlyadopters,butalsogivecarmanufacturersandotherconsumersconfidenceinmarketdevelopment. Non-financialincentiveshavealsobenefitedincreaseddeployment;priorityroadandparkingusehasimpacteduptakeofelectricvehicles,utilitiesaredemonstratingsupportthroughoff-peakratesandgovernmentsarepursuingfleetacquisitionsandpartneringwiththeprivatesectoronmobilityinitiatives.Carsharinghasalsoprovedtobeagooduseofelectricvehicles,allowingdriverstoaccessthebenefitsofelectrifiedtransportwithoutthehigherupfrontcost.

Information and education Measures to increase demand and to strengthen current understanding of the value proposition of lower emission vehicles and fuels Thereareanumberofpotentialgovernmentactionsthatcouldassistinincreasingmarketdemandandinovercomingthebarrierofprospectiveconsumers’knowledgeofthevaluepropositionofloweremissionvehiclesandfuels. Severalbasicdesignprinciplesappearimportantinpolicyimplementation.Consumerinterestcouldbemotivatedbysettingincentivesforthepurchaseoffuelefficientandloweremissionvehiclesincludingbothfinancialandnonfinancialmechanisms.Financialincentivescouldbeintheformofannualincentives(includingtaxrebates,annualregistrationandstampdutyreductions,parkingfeedeductionsandvehicleemissiontaxes)orpunctualincentives(includingdifferentialroadtollsandpricing,freeparking,higherfuelprices)63. ThesepolicyoptionscanbeillustratedthroughtheexampleoftheCaliforniaCleanVehicleRebateProject.Thisprojectoffersupto$5,000forthepurchaseorleaseofazeroemissionsplug-inhybridorlight-dutyvehicle,andhasputover100,000cleanvehiclesontheroads64.Non-financialincentivescouldincludebenefitssuchasprioritylanesandreservedparkingspaces.ThesetypesofinitiativeshavebeenutilisedbybothStateandLocalgovernmentsinAustraliaandinternationallywithvaryingdegreesofsuccess.Currently10U.S.Statesofferunrestrictedaccesstohigh-occupancyvehicle(HOV)orcarpoollanesforelectricvehicledrivers65,andtheBrisbaneCityCouncilandCityofSydneyofferreducedparkingfeesforhybridvehicleswhenparkingspecificallyinthecouncil-ownedcarparks.

63ClimateWorksAustralia(2015)64CenterforSustainableEnergy(2015)65Lutsey,N.(2015)

Requested measures: ToenhanceshorttermuptakeandincreaseEVmodelavailability,upfrontpurchaseincentives,inlinewiththoseseeninleadingmarkets,shouldbeprovidedacrosstheAustralianmarket.

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Measures to encourage the supply of supporting infrastructureAnotherkeyquestionbeingposedininternationalmarketsishowfasttoinstallEVcharginginfrastructure,includingbasicelectricalprovisioninginnewbuildingsandrefurbishments,commuterchargingfacilitiesinworkplaces,andpublicly-accessiblechargingfacilitiesofvaryingchargingspeedsandcapacities.Interviewswithgovernmentofficialsinavarietyofjurisdictionsgenerallyrevealedthatmostbelievethatthemajorityofcharging(90%ormore)willtakeplaceathome.EvidencefromTheEVProjectintheUnitedStatesfoundthatdespiteinstallationofextensivepubliccharginginfrastructure,thevastmajorityofchargingwasdoneathomeandwork66.GiventherelativelyhighercostofretrofittingEVcharginginfrastructure,thereshouldbeconsiderationgoingforwardtoensurethatallnewmultidwellingbuildings,apartmentsandofficebuildingshaveelectricvehiclechargingplannedandbuiltinfromconstruction. Furthermore,targetedprogramsaimedatencouragingworkplaceandhomechargingwouldbenefitelectricvehicledrivers.Forexample,theUKOfficeforLowEmissionsVehiclesadministeraHomechargeScheme,designedtooffsetapproximately75%ofthecapitalandinstallationcostsofinstallinganelectricvehiclechargingstation(upto£700)67. Nonetheless,ithasbeenconcludedthatwidespreadpublicinfrastructureisneededtomitigaterangeanxietyonthepartofprospectivepurchasers.Asaresult,manyjurisdictionshaveaggressiveplansunderwaytoinstallpublicinfrastructure68. Todeveloptherightinfrastructureincludingchargingstationsforplug-invehicles,federal,stateandlocalgovernmentscouldutiliseurbanplanningpowerscoupledwithgrantprogramstowardsbusinessestostimulatetheinstallationofinfrastructurededicatedtoloweremissionvehicles.AnexampleofthisistheEVInfrastructureRebatePrograminIllinois,whichcovers50%ofthecostofequipmentandinstallationofEVschargingstations,withacapbasedonthetypeofstation;morethan$350,000wasawardedin2013,fundingatotalof130stations69. TherearecurrentlymultipleplugstandardsforbothACandDCcharging.PickingastandardforAC,andastandardforDCcharging,wouldstreamlineinfrastructuredeployment,reducecosts,avoidlegacyandredundantchargingstations,andreduceconfusioninthemarket.Carmanufacturerscurrentlyincorporatedifferentplugstandardsfordifferentregions,sotheimplementationofasinglestandardwouldnotbeacommercialburden.AstandardshouldbesetbeforethemassrolloutofpublicEVcharginginfrastructure,asreplacementandretrofittingisexpensive.

Requested measures: ● CoordinationofnationalstrategyonEVinfrastructuredeployment:

○ UndertakestocktakeofexistingandplannedEVcharginginfrastructuredeployment○ Investigateincentivesforcharginginfrastructuredeployment○ Considerfuturechargingrequirementsintermsoflikelyfleetmixes○ HarmonisechargingstandardsbeforethemassrolloutofEVcharginginfrastructure○ EnsuringplanningandinfrastructuredevelopmentisEVready

66IdahoNationalLaboratory(2015)67OfficeforLowEmissionsVehicles(2015)68InternationalCouncilonCleanTransportation(2015)69Jinetal.(2014)

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● Workwithotherlevelsofgovernmenttoincentiviseinfrastructuredeployment(e.g.stimulatecharginginfrastructuredeploymentthroughreducingparkinglevyforCBDbasedparkingfacilitieswithEVcharginginfrastructureorreducedparkingratesforcommuterparkingstations,worktoremovelegislativebarrierstokerbsidechargingdeploymentetc.)● Supportlocalbusinessesprovidinginnovationincharginginfrastructuredevelopmentandinnovativedeploymentbusinessmodels● Ensurethatgovernmentfleetcharginginfrastructureisplacedinareas,wherepossible,thatcanalsobeaccessedbythepublic.

Awareness raising and fuel consumption labelling Internationalresearchsuggeststhatamajorityofprospectiveconsumersarenotwellinformedabouttheexistingpolicyincentivesorthepotentialfuelsavingsfromreplacingtheirconventionalvehicleswithelectricvehicles70.Educationandawarenessactivitieswouldideallyinvolvestateandlocalgovernments,consumergroupsandutilitiesprovidinginformationaboutrelevantpurchasingandchargingincentivesatdealerships,onwebsites,andthroughadvertisingcampaigns. Providinginformationtoprospectiveelectricvehicleconsumersontotalcostofownershipandvehiclefuel-savingbenefitsonwebsitesandconsumerlabelsisanimportantbasicstep.Consumergroupshaveindicatedthatthereisoftenfeedbackonreal-worldfuelconsumptionversusthemanufacturer'sspecifications,whichindicatesthatconsumersarerelyingonthelabellingsystem.TheGreenVehicleGuidewebsitehasbeenausefulresource,howeverwiththerecentupdateandremovalofthestarratingguidetheinformationbecomelessaccessibleforconsumers.Consumergroupshaveindicatedthatthepresentationofdataastheactualg/kmorL/100kmismoredifficultfortheaveragemotoristtounderstand. Publicevents,includingride-and-drivewithpublicofficialsandincreasedplacementofelectricvehiclesingovernmentfleets,increaseawarenessregardingthenewtechnology.Finally,theplacementofvehiclesincompany,rental,andcar-sharingfleetscanalsohelptoovercomethebasicfoundationallackofawarenessandcomfortregardingavailableelectricvehiclemodels. ThereareanumberofoptionsavailabletoraiseawarenessandeducateAustralianconsumersaboutfuelefficientandloweremissionvehiclesandtheirbenefits,andresolvemisinformation. 1. Simplifyingandmainstreamingfueleconomylabelling:

Labelscoveringbothnewandusedvehicles,combiningdirectdisclosureandcomparativeratings:● Type:ThecurrentAustralianfuelconsumptionlabellingsystemdisclosesdirectfuel

consumptionandCO2emissionvalues.AccordingtotheIEA,alabelcombiningdirectdisclosureandaneyecatchingcomparativeratingisthemostusefultovehiclepurchasers.ThiscombinedfueleconomylabellingsystemhasbeenappliedinNewZealand71.ThefueleconomylabelfornewvehiclesinNewZealanddisplaystheirfueleconomyvaluesinlitresper100kmalongsideastarrating.Thelabelsalsodisplaysfuturefinancialsavings.Inaddition,theUKprovidesaneasytoreadcomparativebargraphthatgivesanimmediateindicationofwherethevehicle’sfueleconomyfitswithinthemarket.

70InternationalCouncilonCleanTransportation(2015)71InternationalEnergyAgency(2012)

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● Coverage:Severalcountries,includingNewZealandandtheUK,mandatethelabellingoffueleconomyonnewand/orusedvehicles.ThecurrentAustralianlabellingsystemonlymandatesitfornewvehicles.

2. Settingupinformationcampaignsandtools:

TheformerVictorianFleetwiseProgrampresentsausefulmodelforthestructureofaninformationprogram.Theprogramengagedwithorganisations’fleetmanagersthroughinformationseminarstoprovideguidanceonhowtoimprovefleetenergyefficiency.Theprogramresultedinareductionof149tonnesCO2e72.

3. Hostingexposureeventsandencouragingshorttermtestdrives:

ThesecouldpotentiallybeorganisedbyStateandLocalgovernmentsinpartnershipwithmotoringclubs,andcouldincludetestsdriveevents,orbroadereventssuchasanAustralianlegoftheFormulaE.

Fleet purchasing policy Theimportanceoffleetsalesisdifficulttooveremphasize.In201546%ofAustraliannewvehiclepurchaseswenttofleets73.Forvehiclesellers,fleetsalesareoftenkeytoachievingcorporatesalestargetsandtherebyensuringthattheirupstreaminvestmentsinnewproductdevelopmentandmanufacturecanberecouped.Furthermore,fleetstypicallyturnvehiclesoverat3-5years,andindoingsoprovidealargeproportionofthesecond-handvehiclemarket. ForEVstheroleoffleetsalesisevenmorecrucial.Fleetsprovidemanywould-bebuyerswiththeirfirstexperienceofEVs,andindoingsogreatlyimprovethelikelihoodofadoption74.Fleetoperatorsgenerallyhaveabetterunderstandingofthetotalcostofownership,dutycycleandaremoreunderstandingofissuesstemmingfromthedeploymentofnewtechnology. Governmentfleetsareperhapsthemostimportantofall.Inrecognitionofthebroadersocietalbenefitsandeconomicrationalebehindsupportforemergingtechnology,governmentsaroundtheworldaremakingsignificantcommitmentstoEVadoptionthatreduceinvestmentriskforprovidersandacceleratethemarketadoption:

72DepartmentofEconomicDevelopment,Jobs,TransportandResources(DEDJTR)(2015)73FCAI(2015)74Wikstrom(2014)

Requested measures: •Supportthedevelopmentofasecond-handmarketforelectricvehiclestoensurethatconsumersnotpurchasinganewvehiclehaveaccesstothistechnology•Supportearly-stagedemonstrationanddeploymentofelectricvehicleswithbothgovernmentandbusinessfleetowners•Supportlocalgovernment,consumergroupsandindustryinitiativestoincreaseconsumerexposuretoelectricvehicles

24

● InJuly2014theUKGovernmentprovidedfundingtoallitscarfleetstosupportintroductionofover150plug-invehiclesforthefirstwaveofdeployments75;

● InMarch2015U.S.PresidentBarackObamaorderedthatzeroemissionorplug-inhybridvehiclesaccountforatleast20%ofthefederalagenciesfleetof655,000vehiclesby202076;

● InMarch2016BloombergreportedthatChina’sfourfoldsurgeinEVsaleswasprobablybeingdrivenbygovernmentpurchases,havingaccountedforalmosthalfofthe185,900electricvehiclesoldin201577.

GovernmentsinsmallermarketssuchasSweden78andNewZealand79havebeenorareconsideringfleetprocurementasameanstoaggregatepurchasevolumesandincentivizeEVmodelintroductionstoaddresslocalsupplyconstraints. Incontrast,therearenoreportsofanyEVsbeingdeployedintotheAustralianGovernment’sfleetofover12,000vehicles.Withthedemiseoflocalmanufacturing,fleetpolicieshavemovedawayfrom“Australian-made”suchthatafleetofnineBMW7SeriesweredeployedinJanuary201680.ClearlytheopportunityisfortheAustralianGovernmenttostart“leadingbyexample”throughfleetpoliciesdesignedtopromoteadoptionofEVs.

Requested measures: ● TheFederalgovernmentmandatethatnewfleetpurchasesincludeelectricvehicles,andsettargetsforelectricvehicleuptakewithinfleets● Alllevelsofgovernmentworkwithmanufacturerstohelpaggregatedemandforelectricvehicles,encouraginglowerpricesanddeploymentofnewmodelswithintheAustralianmarket● Governmentfleets(alllevels)shouldberequiredtodevelopaplantoreducefleetemissions(CO2,NOxandPM),andproduceanannualpublicreportonprogress● AschemesimilartotheUSDOEsWorkplaceChargingschemebedevelopedtoprovidethetoolsforfleetmanagerstoassesssuitabilityofelectricvehiclesfortheirfleet,benchmarkperformance,sharebestpracticeandpromotethosefleetsactivelydeployingelectricvehicles,raisingawareness.

Tax and other policy measures Luxury Car Tax Atpresent,luxurycartax(LCT)inAustraliaimposesataxoncarswithaGST-inclusivevalueabovetheLCTthreshold.TheATOstipulatesthisthresholdin2015-16at$63,184.Thereisahigherthresholdforfuelefficientcars(thosewithfuelconsumptionof7L/100kmorless),forwhichelectricvehiclesareapplicable,of$75,37581.LCTisthenimposedontheamountabovethethresholdatarateof33%,andispaidbythosewhosellorimportluxurycars.

75UKGovernment(2014)76OfficeoftheWhitehouse(2015)77Ma(2016) 78Eltis(2015)79Smellie(2015)80Motoring.com(2016)81ATO(2016)

25

TherearearangeofelectricvehicleswithinAustraliawhichcurrentlyfacetheLCT.ByexemptingBEVsfromLCT,andcreatingafurtherthresholdexemptionforlowemissionvehicles(suchasPHEVs)itcanhelpdriveuptakeofthesevehicles. AnalternativetothisistoreplacetheLCTwithanEmissionsTaxforLuxuryVehicles(orequivalent).Thiswouldseezeroemissionvehiclespayingnotax,andthosewithhigherfuelconsumptionreceivinghighertaxonaslidingscale.ThisapproachwouldnotonlyencourageconsumerstoconsiderEVtechnology,butalsoencouragethesaleofmoreefficientvehiclesinmarketbymanufacturers. InHongKong,theGovernmenthasbeenactivelypromotingthewideruseofelectricvehiclesinordertomeetairquality,fuelsecurityandemissionreductionobjectives.Includedintheirsuiteofmeasuresisthefullwaiveroffirstregistrationtax(FRT)forEVssince1994.Throughthisandotherinitiatives,theuptakeofEVsinHongKonghasincreasedfrom74in2010to2,658inSeptember2015,withanincreaseinEVmodelavailabilityinHongKongmarketalsonoted82.

Requested measures: ProvidefullexemptiontoEVsfromtheLuxuryCarTaxfrom2016-17,andaddafurtherthresholdexemptionforlowemissionsvehicles(suchasPHEVs),orreplacetheLCTwithanEmissionsTaxforLuxuryVehicles

Fringe Benefits Tax (FBT) GiventhetraditionalpropensityforAustralianemployerstooffertheprivateuseofanorganisationally-ownedvehicletoalargenumberofemployees,FBTrepresentsamajorfleet-relatedoperationalcostformostorganisations.Inrecognitionofthedisadvantageposedbythemostcommonly-appliedFBTcalculationmethodto“highercapitalcost/loweroperatingcost”vehicles,weproposethatanFBTexemptionbeappliedtoelectricvehiclesfortheperiodleadinguptotheirexpectingpricingparitywithinternalcombustionenginevehiclesaround2020-22. UndertheATOrulesanelectricvehicledoesnotqualifyasbeingexemptforFBT–theemployer,oremployee,willthereforebearanyFBTliabilityshouldthevehiclebeavailablefor‘privateuse’andmustthereforecalculateandpaytheFBTliabilityinfullbasedonthevehicle’s‘TaxableValue’. Anemployercalculatesthetaxablevalueofacarfringebenefitusingeitherofthefollowingmethods: 1.TheStatutoryFormulaMethod-regardlessoftheactualkilometrestravelled,theTaxableValueofthecarfringebenefitsisthestatutoryratemultipliedbythecar'sbasevalue: TaxableValue=(AxBxC)-E D Where: ● A=thebasevalueofthecar● B=theapplicablestatutorypercentage(currently20%)● C=thenumberofdaysintheFBTyearwhenthecarwasusedoravailableforprivateuseof

employees● D=thenumberofdaysintheFBTyear● E=theemployeecontribution 82HongKongGovernment(2015)

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2.TheOperatingCostMethod-theTaxableValueofthecarfringebenefitisapercentageofthetotalcostsofoperatingthecarduringtheFringeBenefitsTax(FBT)year,wherethepercentagevarieswiththeextentofactualprivateuse:

Taxablevalue=(AxB)–C

Where: ● Aisthetotaloperatingcosts● Bisthepercentageofprivateuse(evidencedviavehiclelogbooks)● Cistheemployeecontribution. TheoverwhelmingmajorityoffleetoperatorsusetheStatutoryFormulaMethodduetothehigheradministrativeburdenoftheOperatingCostMethod(whichrequireslogbooks).Asillustratedbythefollowingexamplecalculations,thisapproachdisadvantages“highercapitalcost/loweroperatingcost”emergingtechnologiessuchaselectricvehicles.ScenarioOne–StatutoryFormulaonanInternalCombustionEngineVehicle:

ScenarioTwo–StatutoryFormulaonanElectricVehicle:

Thecurrentdeltaof$7,400inthe‘Vehiclecosttobusiness’isdrivenbyacombinationofthehigher‘BaseValueoftheCar’fortheelectricvehicles(andthecommensurateimpactthishasontheFBTTaxableValue)andthehigher‘Operatingleasecost’ontheelectricvehicle–which,inturn,isprimarilytheresultoflowerResidualValueexpectationsontheelectricvehicleswhencomparedagainstastandardinternal-combustionenginevehicle. ThethirdscenarioillustratesanFBTexemptionfortheelectricvehiclesunderthecurrentStatutoryFormulamethod,usingthesame‘BaseValueoftheCar’and‘Operatingleasecost’assumptionsabove.

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ScenarioThree–FBT-exemptstatusoncurrentElectricVehicles:

Whencomparedwiththe‘Vehiclecosttobusiness’inScenarioOneabove,the‘Vehiclecosttobusiness’inScenarioThreeisnowapproachingparity–thisisadirectresultoftheFBTexemptionontheelectricvehicles.TheresultingexpectationisthatwiththeremovalofthefinancialimpostposedontheelectricvehiclebyFBT,entitiesinthePublicandPrivatesectorarenowmorelikelytoconsidertheuseofsuchvehiclesintheirfleets. ScenarioFourwillnowassumetheAustralianautomobilemarketin2020-22where,asaresultoftheimpactoftheFBT-exemptstatusforelectricvehicles,vehiclemanufacturershaveincreasedtherangeofelectricvehiclesavailableinourmarket.Asaresultofthismodelpromulgation,theaveragecapitalcostforanelectricvehiclesisalsoassumedtohavedecreased.ScenarioFour–FBT-exemptstatusoncurrentElectricVehiclesin2020-22:

The‘Vehiclecosttobusiness’underScenarioFour,whencomparedtoScenarioOneabove,nowdemonstratesamorecosteffectivesolutionfortheenduserinusingtheelectricvehiclewhencomparedtoagainstthestandardinternal-combustionenginevehicle. AdditionalargumentsinfavouroftheFBTexemptioninclude: ● ThemarginalcontributionofelectricvehicletocurrentFBTrevenuestreams–giventheir

extremelylowlevelofsales,anexemptionwillhavenegligibleimpactonthetaxrevenue● FBTisataxliabilitythatcurrentlyimpactsboththeprivateandfleetbuyer,suchthatanFBT

exemptionforelectricvehicleswouldbebroad-basedandnotjustataxbreakforbusiness● TheexistingFBTexemptionframeworkthatprovidesastreamlinedpathwayforintroduction

andoperation,includingforremovalaselectricvehiclesapproachconventionalinternalcombustionenginevehiclespricingparity

● TheclearandpositivemessagethismovewouldsendtovehicleOEMswhomaynotbeconsideringtheAustralianmarketasaviablepropositionforfutureelectricvehicleproductlines

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● Thepositivelong-termimpactthemovewouldhaveonthesecond-handmarketvaluesofcurrentelectricvehiclesalreadyoperatingintheAustralianmarket

● ThepositivemessagethiswouldsendtoLeasingandFleetManagementscompanieswhocurrentlysetextremelyconservative(andthereforeuncompetitiveandunrealistic)residualvaluesonexistingelectricvehiclesintheAustralianmarket

AnadditionalFBT-relatedissue/opportunityisalsosetoutinthesectionon“NovatedLeasing”below.

Novated Leasing InresponsetotheoperationalcostimpactsfromFBTobligationsonorganisationally-ownedvehicles,anumberoforganisationsnowoffernovatedleasestotheiremployees.Fromanemployer’spointofview,anovatedleasehasthebenefitofshiftingtheFBTliabilityofthevehicledirectlytotheemployee.

Underanovatedleasingarrangement,anemployeeleasesavehiclefromafinancierusingastandardfinanceleaseagreement.Theemployee,theemployerandthefinancierthenenterintoanovatedlease,whichtransfersthefollowingtotheemployerforthetermofthelease: ● theemployee'sobligationtopaytheleasepayments● therighttousethevehicle● otherobligationsunderthefinancelease. Acarfringebenefitariseswheretheemployeristhelesseeofacarthatisprovidedfortheprivateuseofanemployeeorassociateoftheemployee.Carsunderafullnovatedleasearesubjecttothesamecarfringebenefitvaluationrulesasothervehiclesleasedbytheemployer/business(refertothesectionon“FringeBenefitsTax”above).

Anemployerinthenovatedleaseisentitledtoadeductionforleaseexpenseswherethevehicleisusedinthebusinessorprovidedtoanemployeeaspartofasalarypackagingarrangement.Theseexpenseswouldnominallyincludechargingenergyifthisformedpartoftheoperationalcostsofthevehicle,howevertheentitlementdependsontheemployerbeingabletoevidencehowtheyincurredtheexpense.

Asanillustrationofhowthisinhibitselectricvehicleadoption,atypicaloperatingarrangementforanovatedleaseelectricvehiclewouldseethevehiclechargingovernightattheemployee’shome.Assumingtheelectricitybillattheresidenceisinthenameoftheemployee,theemployerwouldnominallybeunabletoclaimadeductionforthechargingenergyaspartofthevehicleoperatingcosts.Evenifthechargingenergywasabletobeseparatedoutfromtherestofthehouseholdloadandrebilledtotheemployer,thispathwayrepresentsafargreateradministrativeoverheadthanfornovatedleaseinternalcombustionenginevehicles.

ForthisreasonitisproposedthattheFBTexemptionrequestedabovebeextendedtonovatedleasingarrangements.Importantly,thenovatedleasingFBTexemptionshouldpersistbeyondthesunsetperiodforbusinessfleetvehiclesinrecognitionoftheobstaclestoreasonableclaimsonelectricvehiclechargingoperationalcostsbyemployers.

Requested measures: ● CreateaFringeBenefitsTax(FBT)exemptionforelectricvehiclestoaccountfortheir

highercapitalcostsintheperiodthroughtotheirexpectedpricingparitywithinternalcombustionenginevehiclesin2020-22

● EnsurethattheFBTexemptionextendstonovatedleasingarrangements,andextendthisexemptionbeyondthesunsetperiodforthebusinessfleetvehicleexemption

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Other Measures TheEVmarketisoftendescribedasan‘ecosystem’,reflectingthediverserangeofparticipantsthatinteractacrossit;includingvehiclesuppliers,charginginfrastructureproviders,electricitymarketparticipants,fleetoperatorsandprivateusers.Aseachoftheseparticipantsevolvesintheirunderstandingofthetechnology,theremustbeanegotiationacrossissuescharacterisedbyuncertaintyandrisk.Duetotherecentevolutionofthemarket,thereisanunderstandableabsenceofforumsinwhichissuesandopportunitiescanbetabledandaddressed.

Asaresult,thereislimitedoverarchingcoordinationofelectricvehicledeploymentwithinAustralia.EstablishinganoverarchingroadmaptoassistindrivinguptakeofelectricvehiclestohelpmeetAustralia’semissionreduction,energyproductivityandenergysecuritytargetscanhelpensurestrategicdeploymentofelectricvehiclestoprovidemaximumbenefitstoconsumers,byfacilitatingimprovedmarketcoordination. AnexampleofthishasbeendemonstratedinScotland,wheretheScottishGovernmentdevelopedSwitchedonScotland:ARoadmaptoWidespreadadoptionofPlug-inVehicles,toassistinmeetingtheircommitmentsto“almostcompletedecarbonisationoftheroadtransportsectorby2050”83.ThisroadmapdevelopedasharedvisionfortheEVecosystemandobjectiveswithinScotland,andsetfutureprioritiesandactionstodriveuptakeandtoadvancewholesaleadoptionofelectricvehicles.OutcomeshavealsoincludedincreasedawarenessofEVtechnologyandbenefits,vastlyimprovedcoordinationacrossthemarketthatde-risksinvestmentforallparticipants,andaportfolioofinitiativesconceivedanddeployedinlinewiththeRoadmap.

AdifferentbutstillsuccessfulexampleofanEVmarketcollaborationmodelexistsintheCaliforniaPlug-inElectricVehicleCollaborative.Apublic/privateorganisationfocusedonacceleratingtheadoptionofEVstomeetCalifornia’seconomic,energyandenvironmentalgoals,thePEVCollaborative“convenes,collaboratesandcommunicatesonemergingPEVmarkettrendsandworkstoaddresschallengesandenablestrongPEVmarketgrowth”84.ThePEVCollaborativewasestablishedafterthedevelopmentofaStrategicPlanin2010.Theplanlaysoutthevision,basedonachievingsixgoalsforPEVmarketsuccessby2020.AsofOctober2015,thePEVCollaborativehad45membersand“hasresultedinmanysuccessful-andattimesunexpected-cooperativerelationshipsresultinginpositiveactionsthathavemovedtheneedleonPEVadoption”85.

Requested measures: FederalGovernmentsupportforthedevelopmentofaNationalEVRoadmapto:● Establishanationalelectricvehicleuptaketarget● Identifykeyprioritiesandactionsrequiredtodriveuptake● Facilitateconsultationandengagementacrossindustry,consumerand

governmentstakeholders

83TransportScotland(2013)84CaliforniaPlug-InElectricVehicleCollaborative(2016)85CaliforniaPlug-InElectricVehicleCollaborative(2015)

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