Why does the Coalition hate electric cars?

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Via GovernmentNews:

Australia is a laggard compared to other countries when it comes to encouraging the use of electric vehicles (EVs). The ACT is the only jurisdiction in Australia which offers any sort of incentive to motorists to go electric.

This is in stark contrast to most of the rest of the developed world. Most countries in Europe, and many states in the USA and provinces in Canada, offer tax breaks such as registration discounts, lower sales tax, and reduced tolls. There are also preferential parking schemes and other incentives.

But not in Australia, one of the world’s highest per capita carbon emitters. White the recalcitrance on matters environmental is well known at the federal level, Australia’s states could also be doing a lot to encourage EV use. They are not.

Last month two major reports on EV usage in Australia were published. Both are damning in their views on the situation in this country.

The Future is Electric’ was released by the NRMA, the country’s largest motoring organisation, and the Electric Vehicle Council. “The humble car is undergoing a major paradigm shift,” says the report.

“Manufacturers and technology companies are rapidly moving the automotive industry towards an electric and automated future. As trends around the world point to increasing numbers of electric vehicles, jurisdictions have begun to put in place strategies to phase out petrol and diesel propulsion.”

But not in Australia. The report outlines the widespread and growing use of EVs in many countries, and compares that to the miniscule takeup in Australia, where just 0.1 percent of cars sold last year were electric.

It makes a number of recommendations on how to turn things around. It wants more charging stations. The NRMA has taken the initiative to build these itself, and recently announced a $10 million investment for 40 charging stations around NSW and the ACT, in range of 95 percent of its members.

But its strongest recommendations have to do with more EV-friendly government policies. “The Australian Government should remove impediments to the purchasing of electric vehicles,” it says.

“Australia has a low uptake of electric vehicles compared with our global counterparts. Less than one per cent of Australian vehicles currently possess electric drivetrain technology. The Australian Government should provide a short-term exemption to Fringe Benefits Tax and abolish the Luxury Car Tax for electric vehicles and associated infrastructure to encourage mass adoption.”

The report also calls for governments to demonstrate leadership by buying EVs for their own fleets, which are substantial. It also wants more intergovernmental cooperation:

“The transition to EVs will provide significant benefits across energy, transport, public health, infrastructure and industry development. The Australian Government should establish an intergovernmental working group, representing governments, industry and consumers, tasked with establishing a roadmap for the co-ordinated transition to electric road transport, including the deployment of associated infrastructure.”

It points out Australia’s almost total reliance on imported vehicle fuel, linking EVs with energy security.

Another major report, from The Australia Institute, makes many of the same points.

“Governments around the world offer incentives to support electric vehicles. Australia does not,” says the report, which goes on to examine how Australia can boost electric vehicle sales “in four proven, low-cost ways.”

The report, If you build it, they will charge, looks at policies Australian governments can implement to overcome barriers to EV usage. “If governments act now to support the development of the market, financial and environmental benefits will flow.”

It proposes four incentives

  • A Luxury Car Tax exemption for electric vehicles, to better target the scheme’s two-tiered threshold structure towards environmental outcomes.
  • Charging station rebates, which would boost rollout of electric vehicle infrastructure and minimise duplication of sites and technological standards.
  • A scheme to reduce the upfront cost of electric vehicles without cost to the budget.
  • An offer to allow electric vehicles to utilise bus lanes in congested urban centres, supported by a rollout of EV-only license plates.

“Public interest in electric vehicles continues to rise and policies to support electric vehicles are popular. Polling for The Australia Institute shows that nearly two thirds of voters support incentives for electric vehicles.”

But there are none.

And Flufferax:

A Liberal MP purportedly leading the charge against increased taxpayer support for electric cars says there is no looming backbench revolt, as other Liberals dismissed divisions over the issue as “nonsense”.

Craig Kelly, the chair of the Coalition’s energy and environment committee, played down ructions despite having warned that electric vehicles have a bigger carbon footprint than conventional cars – a view that has since been rubbished by the expert who created the website upon which the assertion was based.

The government will continue to support the electric car industry according to the energy minister, despite opposition from colleagues.

Environment and Energy Minister Josh Frydenberg this month kickstarted debate on electric vehicles in an interview and opinion piece for Fairfax Media, saying the right preparation, planning and policies would allow Australian consumers to benefit from the transport “revolution”.

Electric vehicle advocates say financial incentives should form part of government assistance to the industry, however Mr Frydenberg has not committed to this or any other measure.

On Monday he told Sky News that “we are not proposing new subsidies”.

Mr Kelly told The Australian last week that electric vehicles relied on coal-fired electricity to run and created more carbon dioxide pollution than petrol vehicles.

He further warned against any subsidies to make electric cars price competitive, arguing “you’ll have the rich person in Balmain buying a Tesla, subsidised by the bloke in Penrith who’s driving a Corolla”.

​The Sydney-based MP was reportedly backed by Nationals Andrew Broad and John Williams, and would raise the issue of government assistance in the party room when Parliament resumes.

However Mr Kelly on Monday rejected suggestions of an internal brawl.

“It’s not so much [about] raising it in the party room. Transport policy as far as carbon emissions reduction will be an ongoing debate throughout this year,” he told Fairfax Media.

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Reading between the lines, Frydenliar made it plain there will be no support. Why? Which Coalition sponsor comes out worse off? The miners benefit. The gas cartel benefits. The coal industry benefits (in the short term). The economy benefits from a surge in investment. We could even make ’em.

Is it because it was Kevin Rudd’s idea to save the car industry by going electric that the Coalition killed? Or is it just the climate morons all over again?

I suspect it’s the usual mangling of policy to fit a world view that the Cabinet feels it can defend against its perpetual enemy, the green demon.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.