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Australian Government commits to expanding electric vehicle charging stations but no subsidies to increase uptake

By political reporter Henry Belot

Posted 6h ago6 hours ago, updated 4h ago4 hours ago

The government has released its Future Fuel strategy.(ABC News: Marc Smith)

The federal government will partner with the private sector to fund 50,000 charging stations in Australian homes, in a bid to encourage more people to buy electric vehicles.

Key points:

• The strategy does not include subsidies or tax incentives to increase uptake of EVs
• Increased funding for charging infrastructure is expected to create 2,600 jobs over three years
• The government says improved battery technology will be the key to lowering the cost of EVs

The long-awaited Future Fuels strategy does not include subsidies, tax incentives, sales targets or minimum fuel emission standards that would make electric vehicles more affordable though, according to industry groups.

"Reducing the total cost of ownership through subsidies would not represent value for the taxpayer, particularly as industry is rapidly working through technological developments to make battery electric vehicles cheaper," the strategy said.

It instead aligns with the "technology not taxes" mantra that underpins the government's broader approach to emissions reductions.

The strategy includes expanding the Future Fuels Fund to a total of $250 million of taxpayers' funds, which the government estimates will create 2,600 jobs over three years.

It does not say exactly how or where those jobs will be created but does point to employment opportunities through supply chains and manufacturing needed to sustain an electric vehicle market.

The government argues its investment will help ensure companies do not concentrate charging stations in inner-city areas, which may dissuade people in outer suburban or rural areas from purchasing an electric vehicle.

The strategy does not set a sales target for electric vehicles such as the 50 per cent by 2030 figure outlined before the last election by Labor, which was criticised by several Coalition ministers "a war on the weekend".

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"We will not be forcing Australians out of the car they want to drive or penalising those who can least afford it through bans or taxes," Mr Morrison said.

"Instead, the strategy will work to drive down the cost of low and zero-emission vehicles and enhance consumer choice."

The federal government will ask state and territory energy ministers to incentivise the use of smart chargers in homes and work with energy regulators to ensure the electricity grid can handle more batteries.

How does the strategy compare?

The government's strategy is notably different when compared to other nations.

More than 80 per cent of the global car market – including Europe and the United States – now require new cars to meet minimum emissions standards before they can be sold.

The strategy released on Monday confirms Australia does not plan to adopt these standards, which would require more stringent restrictions on pollutants in petrol, and require new cars to emit far less particulate matter than currently allowed.

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In August, US President Joe Biden outlined a 50 per cent sales target by 2030. Several other nations including Austria, China, Denmark, the Netherlands, Portugal, Korea and Spain have also announced targets.

Many nations have also announced tax concessions or subsidies to lower the price of electric vehicles, which are currently too expensive for many people.

France has one of the most generous schemes, which recently offered a discount of around $18,000 on a new electric vehicle if you traded in a petrol or diesel car.

Federal Labor has pledged to cut government taxes on non-luxury electric vehicles, which is estimated to make a $50,000 car about $2,000 cheaper. The policy would cost $200 million over three years.

Industry calls for more regulation

As well as providing incentives to encourage people to go and buy electric vehicles, car manufacturers were also hoping the government would step in and provide stricter emissions regulations for petrol cars.

That would, according to the industry, also help make electric vehicles more competitive against their petrol or diesel counterparts, and in the process make Australia a more appealing market.

One of the focuses of the government's strategy is expanding charging stations nationwide.( Supplied: Australian Electric Vehicle Association)

Earlier this year, Michael Bartsch, the general manager of Volkswagen Group Australia, said the company's head office refused to supply electric cars to the Australian market.

"Australia has some of the most lax environmental standards in the world," he said.

"We'll put those cars where we get the biggest commercial advantage and the biggest commercial advantage of the moment, when you overlay the fines for not achieving the CO2 targets, is Europe."

The EV industry had also previously called for the government to exempt electric cars from the luxury vehicle tax, in another bid to encourage manufacturers to import a wider range of electric cars.