US emissions shift highlights need for EV bipartisanship

Australia’s peak motoring body says the Biden administration’s significant recalibration of the USA EPA’s fuel efficiency standard means both sides of politics in Canberra must reconsider their respective approaches to the establishment of similar Australian regulation.

The USA has had a fuel efficiency standard in place for several decades, but the proposed annual emission reduction targets for the years between 2027 and 2032 were today wound back by up to 21 per cent.

The AAA has long supported an efficiency standard as a means of ensuring Australians have access to a first-world vehicle fleet and feared that until such regulation is in place, carmakers will not prioritise Australia when allocating their most advanced vehicle technologies.

The AAA had also questioned Government claims that its proposed New Vehicle Efficiency Standard would align to the US approach, given the significant observable differences between the two approaches.

Given the significant changes to the USA targets, the AAA again encourages the Government to release economic analysis underpinning its approach so Australian motorists can better understand its effects.

The AAA also encourages the Opposition to consider how the USA EPA announcements underscore the importance of Australia adopting an emissions standard system that balances ambition with achievability, and which aligns with similar global markets.

AAA Managing Director Michael Bradley said: “The AAA is concerned that an ongoing lack of political bipartisanship on vehicle emissions policy will inhibit the private sector investment needed to build out the EV recharging network necessary to deliver ongoing consumer confidence.

“Irrespective of an Australian standard’s final headline targets, carmakers will be sending a significantly higher number of EVs to Australia in the years ahead. Range anxiety and charging anxiety will remain two of the greatest impediments to EV uptake in Australia unless Australia has the policy clarity needed to reassure investors in network expansion.”

The AAA says New Zealand provides an example of the dangers in designing major economic reforms without bipartisanship, noting the National Party Government elected last October is now dismantling the extremely ambitious targets that the former Ardern Government had put in place with the support of the NZ Greens.

Mr Bradley said: “Vehicle efficiency standards are too important to fall victim to partisanship. Investors need political parties to work together in the national interest, and policy settings that can live beyond changes of Government.

Mr Bradley said governments should also consider whether enough was being done in skills training to ensure Australia was training EV technicians at a rate commensurate with the Government’s hoped-for EV uptake.

They should also recognise that as more Australians embrace EVs, the burden of road construction and maintenance, funded through fuel excise collection, will fall upon a declining proportion of people.

Mr Bradley said: “Our fuel-excise-based system is becoming less equitable and less sustainable.

“We should be thinking now about a system of road user charges that can ensure the cost burden is more equally shared among all road users.”

/Public Release. View in full here.