Australia is one of the least charged of the world’s wealthy countries. During the 2019 elections, Prime Minister Scott Morrison characterized EVs as a threat to Australians’ way of life, and that seems to have set the tone for Australia’s EV policy, or lack thereof, ever since. Until now, there has been little or no government support for EVs, and their market share remains below 1.0 percent. The province of Victoria recently implemented a punitive mileage-based tax on EV drivers. (Australia is also a major exporter of coal, which accounts for about 75 percent of its electricity generation.)
That’s the bad news. The good news is that New South Wales, Australia’s most populous state, just announced an extensive new EV policy package that includes $500 million worth of tax exemptions, rebates and infrastructure investment, along with perks for EV drivers.
New South Wales Energy and Environment Minister Matt Kean recently told the Sydney Morning Herald, “Our aim is to increase EV sales to more than 50% of new cars sold in NSW by 2030 and for EVs to be the vast majority of new cars sold in the state by 2035,” and added that he wants to make NSW “the Norway of Australia when it comes to electric vehicles.”
Norway plans to end new gas car sales by 2025, and in March, plug-in vehicles reached a market share of around 90% , so Australia has some catching up to do, to say the least. However, the new package, which incorporates some incentive ideas that have worked well in Norway and elsewhere, is a good start. It’s expected to be fully implemented by September 1.
The state of NSW was planning to institute a high EV tax in the same amount as neighboring Victoria (2.5 cents per kilometer driven), but has now decided to delay implementation of the tax until 2027, or whenever EVs make up 30% of new vehicle sales.
Other elements of the new policy:
- Stamp duty, a 3-5% tax collected on the purchase of a new or used vehicle, will be waived for any EV costing less than 78,000 AUD.
- The first 25,000 new EVs sold in the state will qualify for a rebate of 3,000 AUD. The rebate only applies to cars priced under 68,000 AUD (a base Tesla Model 3 would just squeeze in under the limit).
- EV drivers will be allowed to use two- and three-passenger carpool lanes during heavy traffic hours.
- The NSW government will invest 171 million AUD on new charging infrastructure, including 131 million for ultra-fast DC chargers, 20 million in grants for destination chargers and 20 million for charging infrastructure at public transport hubs.
- The NSW government has allocated 33 million AUD to help transition its own passenger fleet to EVs “where feasible,” and aims to have a fully-electric fleet by 2030.
In a vicious cycle, Australia’s lack of incentives has caused automakers to allocate few or no EVs to the country. For example, Volkswagen doesn’t plan to bring its ID.3 and ID.4 to the Australian market until 2023 or 2024. Several EV manufacturers praised the NSW government’s announcement.
“New South Wales is now setting the pace for the rest of Australia,” said Hyundai Australia COO John Kett. “We’ve seen government incentives stimulate adoption rates in advanced markets overseas and the NSW EV Strategy is at world best-practice levels in that regard. We look forward to being a key partner in the transition as we continue to expand the range of Hyundai EVs available to all Australians in the future.”
Nissan Australia Managing Director Stephen Lester called the strategy “extremely encouraging,” and added, “These types of polices not only accelerate the EV transition right now, but also put Australia in a stronger place for priority adoption of new vehicle technologies, sooner.”
Volkswagen Australia Group called the policies “a model to drive Australia out of the automotive third world.”