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The Govt has missed a big opportunity to boost electric vehicles

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Christmas is the usual time for the disappointing message “batteries not included”, but we just got the let-down in our Budget. Where were the policies to encourage people and businesses to swap their petrol-powered vehicles for electric vehicles? The Greens pressed for new measures, but none made the cut. More money for trees to soak up greenhouse gases is good, if the policy is well-implemented, but how much better to quickly and drastically stop emitting the worst of those gases, CO², in the first place?

Ground zero is where the rubber meets the road: Statistics NZ reports that our road transport alone makes up just shy of 40% of all CO² emissions. The Government has admitted it needs to do more, but hasn’t. Its target of having 64,000 electric vehicles on the road by 2021 seems fanciful given today’s 13,600 EV national fleet. For perspective, there are four million cars on the road in all.

There’s a lot to love about EVs. They’re not yet the cheapest vehicles on the road – though that will change markedly in the future – but they are already 80% cheaper to run and require minimal maintenance.

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A recent survey by Drive Electric reports a motorist cashing in $30,000 from KiwiSaver to buy an EV because doing so yielded an effective 10% annual return on investment compared with leaving the money earning interest and continuing to drive a petrol car.

The Government and automotive industry have so far spent $17 million on fostering electric vehicle uptake and expanding the charging network, but capital subsidies and tax incentives will probably deliver the best nudge-power.

Norway has led the world in conversion by making electric vehicles cheaper than petrol cars. In what is truly a transformative “well-being” approach it has stripped all taxes, tolls and parking charges from EVs and hybrids, including their GST-equivalent, and provides free kerbside charging.

But it’s also necessary for governments to conquer a lingering lack of consumer confidence in what is a new and still – in this country – comparatively scarce technology. A recent survey found Britons were deterred, despite enthusiasm for the technology, both by the cars’ prices and uncertainty around the technology. The limited range relative to petrol is a psychological deterrent, given the lack of charge sites. Recent scares over what turned out to be minor glitches have also fuelled fears over resale value, battery renewal and even technological redundancy.

More automotive giants are pushing the technology ahead, with boasts of great leaps forward in the next year or two. Most promisingly, China looks set to lead the world in developing new technology. The world’s biggest emitter, alongside the US, is getting serious about climate change and domestic air pollution, and is anxious to curb its dependency on oil imports. From this year, China is requiring carmakers to comply with an ever-rising quota of “green” products, including imports, from plug-ins to hybrids, and anything new they can devise. Fail, and they will be fined.

Britain has proven the negative to Norway’s positive. Last year, it slashed subsidies to electric cars and abolished them for hybrids. It now runs far behind its big trading partners in the adoption of green vehicles. Yet air pollution, and the growing realisation of how much disease and death are directly attributable to it, has now put the focus back on the imperative of phasing out petrol-driven cars as quickly as possible. A new target of 2030 is under discussion.

At least New Zealand is making progress on ensuring affordable and plentiful electricity. The Commerce Commission set new limits on what Transpower, which controls our national grid, can charge. Rather than letting this monopoly charge what it sees fit and claiming its mark-ups are necessary for maintenance investment, the commission has independently assessed Transpower’s future capital needs, and capped its pricing in line with that. The rest of the sector is also under review, and further reform and efficiencies are envisaged.

The Government is helping to fund more charging stations, and is having Vehicle Testing NZ test battery-quality assessment methods, but conversion to EVs is still embarrassingly sluggish on a world scale. Petrol pumps will soon be as quaint a sight as the coin-operated public phone booths, and considerably less fondly remembered. The Government should be ensuring we consign the last one to Te Papa long before the 2050 net-zero emissions deadline.

This article was first published in the June 15, 2019 issue of the New Zealand Listener.