Fuel efficiency rules next hurdle for govt

A report says motorists would save money if Australia introduced fuel efficiency standards for cars.

A report says motorists would save money if Australia introduced fuel efficiency standards for cars.

Australia could help drivers save billions of dollars by matching fuel efficiency rules for cars imposed by other leading economies, a report says.

Stronger standards for new vehicles would cut greenhouse gas emissions and reduce the cost at the bowser, according to the Australia Institute report released on Monday.

It found $5.9 billion in fuel costs would have been saved, and emissions equivalent to a year’s worth of domestic flights avoided, if robust fuel efficiency standards had been adopted in 2015.

Much of Europe – and Australia’s ACT – will ban petrol and diesel cars by the 2030s.

Critics fear the current “weak” standards would limit choices for climate-savvy Australian drivers in a market where demand for electric vehicles is outstripping supply.

“If we want to see larger and more frequent shipments of EVs to Australia, government should ignore the weak standards some in industry are lobbying for,” Electric Vehicle Council chief executive Behyad Jafari said.

Cars in Australia have a 15-year average life span, upping the pressure to act now or lock in internal combustion engines for longer and fail on net zero, he said.

Emissions from transport make up one-fifth of Australia’s total and are among the fastest-growing sources nationally, making the sector key to achieving the national target of a 43 per cent cut in emissions by 2030.

Fuel efficiency targets require manufacturers to pay a penalty for exceeding carbon emissions targets set for the average of new vehicles they sell.

Tougher standards could create a stronger incentive to sell enough low-emission and zero-emission vehicles to avoid raising their average.

If the federal government won’t impose adequate mandatory standards, Mr Jafari encourages state governments to do it themselves.

The industry’s influential peak body, the Federal Chamber of Automotive Industries, wants the current voluntary standards to continue.

Voluntary rules have been in place since the 1970s. A new industry-led emissions standard was introduced in 2020 for passenger cars and SUVs, which the federal government could opt to carry over into a new regime.

“If we finally get around to it and then introduce standards that don’t work that would be a tragedy,” Mr Jafari said.

Australia Institute spokesman Richie Merzian said efficiency standards were a “widespread and modest” mechanism used by governments to ensure new cars were less polluting.

In 2018, the average carbon dioxide intensity for new passenger vehicles in Australia was 169.8 compared with 129.9 in the US, 120.4 in Europe and 114.6 in Japan, the report says.

Almost two in three Australians (65 per cent) support the introduction of national fuel efficiency standards in line with those in Europe, according to the institute.

And as the fuel excise cut ends next month, authorities could save motorists in the long term with a new standard, Mr Merzian said.


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