New South Wales announces $490 million EV incentive and support package in 2021 budget

The slow cascade of reform and incentives to adapt to a future of e-mobility has hit New South Wales, as the government announces a $490 million package to boost battery electric vehicle (BEV) uptake in the state.

Electric vehicle reform is often a battle of ideologies and ministerial power; state treasurers see potential sources of revenue whilst environment and transport ministers see community, environmental, and social benefits.

With Victoria’s rush to implement a user charge on electric vehicle owners receiving wide condemnation, NSW has taken a considered approach to state reform in this area. While not as generous as incentives implemented by the government of the Australian Capital Territory, NSW is heading in the right direction, and this announcement has received wide acclaim from industry groups like Federal Chamber of Automotive Industries (FCAI), manufacturers such as Nissan Australia and Hyundai Motor Company Australia, and community groups like Solar Citizens.

The $490 million package aims to cut the upfront costs of electric vehicles for early adopters from September 1 this year, with a $3,000 rebate available for just the first 25,000 purchases below $68,750. The following vehicles currently on the market in Australia would be eligible for this rebate:

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L to R: NSW treasurer Dominic Perrottet, EV Council CEO Behyad Jafari, NRMA CEO Rohan Lund, NSW Environment minister Matt Kean and NSW transport minister Andrew Constance. Image: Andrew Constance via Twitter

• BMW i3

• Hyundai Ioniq range

• Hyundai Kona Electric range

• Kia Niro range

• Maxda MX-30 E35 Astina

• Mini Electric

• MG ZS EV

• Nissan Leaf Range

• Tesla Model 3 Standard Range Plus

Stamp duty on BEVs and hydrogen vehicles will be waived from September 1 this year, provided the vehicle retails for less than $78,000. Duty in the state is calculated at a rate of 3 per cent on the vehicle’s value (excluding registration and compulsory third party insurance, but including Goods and Services Tax (GST) and Luxury Car Tax (LCT)) and an additional 5 per cent on every dollar about $45,000.

These incentives will be offset by a 2.5c/kilometre charge set to be introduced in 2027, or when EV sales in the state make up 30% of total sales, whichever comes first.

As an example, if you were looking to buy a Kia Niro EV that had a retail price of $66,000 inclusive of options and federal taxes, the state stamp duty cost would be $2,400. Instead, the government is reducing the price to $63,000 for those first 25,000 takers.

If you purchase a $66,000 BEV once the c/km charge comes in in 2027 —assuming stamp duty rates remain the same— you would be saving $2,400 in duty payable to the state.

Unfortunately, this unfairly targets consumers in regional areas or those who are pushed to the urban fringe of Sydney, who are forced to drive long distances due to limited transport options. A 2.5c/km charge wouldn’t concern an inner-city driver who might cover ten-to-twenty kilometres a day and certainly wouldn’t push that driver into public transport options.

It would disadvantage many of the state’s residents who have no option but to drive hundreds of kilometres a week; a commuter who travels 30,000 kilometres a year would eradicate any stamp duty saving on that $66,000 vehicle above in just three and a quarter years, paying $750 in EV tax annually.

The NSW government also announced that its own vehicle fleet would be fully electrified by 2030, and is putting $33 million toward that goal.

NSW transport minister Andrew Constance is hopeful that an increase in electrification of vehicles in NSW will reduce the state’s emissions, saying “Our transport sector currently makes up 20 per cent of the state’s emissions, with almost 50 per cent of those coming from passenger vehicles,” Constance said. “Electric vehicles are not only cheaper to run and quieter on our roads, but they also reduce both carbon emissions and air pollution which results in dramatically improved health outcomes for our communities.”

There’s also $171 million to establish a network of ultra-rapid vehicle chargers across the state’s major highways, that aims to replicate Queensland’s Electric Super Highway, $20 million in grants to assist key tourist sites rolling out destination charging facilities, and $20 million for charging infrastructure at public transport hubs and depots.

The government has an ambitious target to ensure Sydney residents are no more than 5km from a rapid charging site, and that regional residents are within 100km of rapid charging facilities. Buried deep in the press release were these maps, and it looks like the government intends to provide pretty broad coverage across all areas of NSW.

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The NSW government has announced that most of the state will be covered by DC rapid charging sites, with communities to be no more than 100km from a charger.

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Sydney residents are promised a rapid charging network that will likely roll out at key sites around the city’s orbital motorway system, with charge points to be located within 5 minutes drive of all residents.

NSW is set to roll out a network of rapid EV charging sites across the state’s highways and freeways.

According to The Driven, NSW energy minister Matt Kean said the new policies should put the state on track to see an electrification rate of 50 per cent of new car sales.

“Countries and carmakers around the world are moving to EVs and NSW consumers deserve access to the latest vehicle models when they go to buy a car,” Kean said. “We also know that, with new cars staying on the road 15 years on average, the vast majority of new cars sold in NSW need to be EVs by 2035 to achieve net zero emissions by 2050.”

“Our aim is to increase EV sales to more than 50 per cent 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.”

“This nation-leading plan will help us achieve these objectives by tackling the three biggest barriers to purchasing an EV – range anxiety, upfront cost, and model availability – and is forecast to see EV new car sales hit 52 per cent by 2030-31. We want new and cheaper models of EVs to be available here in NSW and this strategy is designed to drive that outcome,” Kean added.

The above initiatives are certainly welcome, and with around 400,000 new car sales a year, NSW holds the crown for the largest passenger car market. Any uptake in electrification will certainly assist in emissions reduction.

Kia’s Niro EV will benefit from zero stamp duty under the NSW government’s new EV scheme.

There are a number of policy changes that we would have liked to see alongside the EV incentives:

• Interest-free loans for EVs and household batteries and solar (as per the ACT)

• A charge on internal combustion engine vehicles, either at the point of sale or on a cents-per-kilometre basis factoring in weight and emissions

• Low Emissions Zones (LEZs) established in congested areas such as Sydney’s central business district (CBD), the Parramatta CBD, and in the soon-to-be-built third Sydney basin city of Bradfield;

• Concessions for those outside dense metro areas

We believe that along with the carrot approach, a little bit of stick is needed to accelerate the change to EVs. As New Zealand recently demonstrated, EV subsidies should work hand in hand with appropriate levies on polluting internal combustion vehicles. a Ford Ranger or Toyota Hilux will incur an additional $NZ2,900 fee under the country’s new scheme.

NSW’s scheme also penalises those who have no choice but to drive more; a 2.5c/km charge won’t impact an inner-city Sydney resident who might drive 5-6km per day (and certainly won’t be a push factor into public transport), whereas it would have a large impact on regional residents or those on to the city’s fringe who are forced to commute 50, 80 or 100+ kilometres per day by car, and don’t have alternative transport options.

The scheme should take this into account, and we believe emissions zones would be another great addition. By designating certain dense city areas a LEZ, The state can generate additional revenue, dissuade polluting trucks and ICE cars from entering central city areas at peak times, and improve public health outcomes for commuters and residents.

The state’s Premier, Gladys Berejiklian has stated that the new city of Bradfield — currently in the early stages of master planning — will be Australia’s first 22nd Century City; if this is truly the case, the government should recognise any city from the future must be emissions-free. When a government has the rare opportunity to plan a dense metropolitan area from scratch, it must think big, and it must think zero-emissions.

All in all, this is a welcome announcement from the NSW government, and with rebates and stamp duty waivers set to commence from September 2021, we may see a sharp increase in EV sales in the latter part of this year.

Zero interest loans for electric vehicles in Australian first: 2 years free registration and $15,000 interest free loans

From today, May 24 2021, the Australian Capital Territory (ACT) became the first jurisdiction in Australia to incentivise EV uptake, by offering a raft of measures it hopes will reduce the territory’s emissions, and provide great zero-emission vehicle choice to its residents.

Already offering zero stamp duty for zero-emissions vehicles, the Labor-Greens government has added two years free registration (a saving of $317-573 per year depending on vehicle weight) and the ability to access an interest-free loan of up to $15,000 to assist with the purchase of an EV.

The ACT’s nation-leading incentives show a firm commitment to address emissions within the territory, and is part of a broader plan to support clean energy job-creation, decarbonise public transport, and roll out a fast-charging network. More information can be found on the ACT Government’s website.

Under the ACT government’s new incentives, MG’s ZS EV could cost around $28,990 with the $15,000 interest free loan applied. Image: MG Motor Australia

Policy certainty is key to receiving investment from overseas manufacturers in Australia, and increasing consumer choice in the marketplace. “We already adopted a zero-emissions vehicle action plan in 2018, and it was first and foremost about transitioning our own government fleet.” according to Shane Rattenbury MLA, Attorney-General and Minister for Water, Energy, and Emissions Reduction, who spoke with us on a recent podcast. “We wanted to help create a more stable market so that the car companies would start bringing vehicles to Australia. We now want to move into encouraging more private uptake.”

The ACT should also be commended for recognising that cost is a huge barrier to entry into a zero-emissions vehicle for many Australians, and that by electrifying government fleets, they are creating a secondhand EV market in three or four years time.

The ACT government has also committed to electrifying their entire bus fleet, and has recently acquired 20 hydrogen fuel cell Hyundai Nexo vehicles — the first hydrogen vehicles to be registered in Australia — which it will lease from the Korean manufacturer.

You can view our full interview with Shana Rattenbury MLA below.

Energy Renaissance announces start of construction for Australia's first lithium-ion battery factory

Australia will soon be producing lithium-ion batteries onshore, thanks to start-up Energy Renaissance. With funding raised exclusively from private investors, Energy Renaissance has committed to manufacturing batteries at a site in Tomago, NSW, only a few kilometres from the Port of Newcastle.

Energy Renaissance’s 4,500 sqm purpose-built facility will manufacture Australian made batteries that are, according to the company “safe, secure, affordable and optimised to perform in hot climates.” Energy Renaissance will be manufacturing energy storage systems for the transport industry including busses and light commercial vehicles, as well as batteries for grid-scale, mining industry and community storage uses.

Energy Renaissance will have an initial battery production capacity of 48MWh per year and the capacity to expand to 180MWh per year in 2022. Energy Renaissance’s long-term plans are to develop a 1GWh battery manufacturing facility, and potentially grow to 5.3GWh over the next decade.

Construction of the facility will commence in April 2021 with a small-scale production trial run of batteries to start by July 2021, ramping up to full-scale production in October 2021.

CIS Solutions recently undertook an independent economic impact analysis, and concluded that an Australian advanced manufacturing industry supplying and exporting battery-grade chemicals and materials would create over 100,000 construction and 80,000 operational jobs and add AUD$7.3 trillion in export revenue. (Note that we haven’t been able to find a link to this study online)

There has been a dramatic decline in appetite for Australian iron ore and coal both domestically and internationally, and the Australian Government has been rather slow in realising that lithium—a metal found in abundance in Australia—has the potential to not only generate serious export dollars as global demand for batteries rises over the next decade, but to also shore up skilled manufacturing jobs locally, assisting the transition and retraining of mining sector workers.

Energy Renaissance is perfectly placed to take advantage of this; it’s investment to process raw materials locally in a region already known for mining means that the company should have a captive employment market available, as well as access to global markets via the nearby port.

With the New South Wales committing to purchase over 8,000 electric buses, this should present a great opportunity for Energy Renaissance to find local customers.

The government’s Minister for Industry, Science and Technology Karen Andrews and the Prime Minister, Scott Morrison were also present at Energy Renaissance’s manufacturing facility launch, and were keen to jump in with their own announcement, releasing the Resources Technology and Critical Minerals Processing road map in the Commonwealth Government’s Modern Manufacturing Strategy.

The Strategy has the following goals:

• 2 years: Improved capability to bring products quickly to market, through improved market development activities and investment made in critical enablers.

• 5 years: Foster increased collaboration with relevant sectors and international supply chains, increase exports and grow private sector investment.

• 10 years: Australia seen as a regional hub for resources technology and critical minerals processing, with significant R&D advancements, retention in intellectual capital for SMEs and significant volume and value of exports.

We’ll keep you updated as Energy Renaissance’s facility comes together.

Read more about the government’s strategy here: https://www.industry.gov.au/data-and-publications/resources-technology-and-critical-minerals-processing-national-manufacturing-priority-road-map

British Columbia Leading Canada's Green Transition, COVID-19 Brings Economic Opportunity

Clean Energy Canada brings us a story that demonstrates the importance of climate action to British Columbians. According to a poll in July by Clean Energy Canada, 79 percent of British Columbians agree that COVID-19 has brought about economic change that presents opportunities to mitigate climate change.

B.C. also set new 2025 emissions targets earlier this month. George Heyman, Minister of Environment and Climate Change Strategy said in a press conference “Across the province, people are working every day to tackle climate change and make our economy cleaner and stronger. It’s clear we still have much more to do in order to meet our CleanBC targets – and I won’t be satisfied until we see a significant and steady decline in emissions. To make sure we stay on track to build a cleaner and stronger future, we’re putting in place a new near-term emission target that is both ambitious and achievable. This is another key step on the path to reaching our climate targets for 2030 and beyond.’

The new emission target requires greenhouse gases in B.C. to be 16% below 2007 levels by 2025. and also provides a benchmark on the road to B.C.’s legislated emission targets for 2030, 2040 and 2050 of 40%, 60% and 80% below 2007 levels, respectively. The Province will also set sectoral targets, which are yet to be established, but shoud be finalised before March 31, 2021, and will develop legislation to help B.C. reach net zero by 2050 targets.

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Source: B.C. 2020 Climate Change Accountability Report

The 2020 Climate Change Accountability Report provides new estimates for provincial emissions for the next four reporting years (2019-22) and modelling of the estimated impacts of CleanBC actions by 2030, as well as data on progress made through CleanBC in sectors like transportation, industry, buildings and communities and the public service.

Merran Smith, executive director at Clean Energy Canada, made the following statement in response to the above report:

“B.C. has emerged as not only a Canadian leader but a world leader when it comes to climate action. It was the first government in North American to price pollution, the first to legislate a ban on the sale of gas-powered vehicles, and it was among the first to make its emissions targets legally binding.

“B.C.’s climate leadership hinges on a new, rigorous system of climate reporting and accountability, which means celebrating our successes while also acknowledging—and acting—when more needs to be done. Climate policies are only as successful as the results they accomplish.

“While the B.C. government’s new goal of reducing emissions by 16% below 2007 levels by 2025 is a commendable start, it’s also a reminder of how far the province has to go to reach its 2030 goal of 40%. Emissions have been heading in the wrong direction, and we certainly hope we don’t have to say that again next year. We look forward to seeing the province’s updated plan, due next year, for how it will reach these targets. 

“Polling shows that the vast majority of British Columbians want to see B.C. put fighting climate change at the centre of COVID recovery plans. And with a Biden presidency kicking off the new year and game-changing clean stimulus plans from countries like Germany, the U.K., and South Korea, it’s clear that B.C. must compete on climate if it’s to compete economically into the future. The province’s climate plan, CleanBC, provides an excellent platform on which to do so. Now is the time to increase its ambition—and there is no time to waste.”

Electric Vehicles

B.C. has had a Zero-Emission Vehicles Act since 2019, which sets phased-in annual targets and other compliance requirements, ensuring automakers increase the number of EVs that they sell in B.C. to meet consumer demand. Automakers will be required to achieve 10% provincial ZEV sales by 2025, 30% by 2030, and 100% by 2040 (for light-duty vehicles).

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Source: B.C. Climate Change Accountability Report

From the above report:

The province is backing Battery Electric Vehicles with clear and simple goals including:

• making electric cars more affordable

• shifting to renewable fuels

• investing in charging and hydrogen refuelling stations, active transportation and public transit”

B.C., together with a range of partners, has made good progress in setting a path for lower emissions, particularly for passenger vehicles. ¡ In 2019, electric light-duty vehicle sales more than doubled compared to the previous year to over 17,000, making up nearly 9% of all light-duty vehicles sold in B.C. This brings us close to our 2025 target of 10% ZEV sales for new vehicles five years early.

To help expand availability of ZEVs, B.C. also completed regulations that mandate 100% of new lightduty vehicles sold to be ZEVs by 2040. ZEV compliance requirements start for the model year 2020.

Supported by the CleanBC Public Charger and Hydrogen Fuelling Programs, there are currently more than 2,000 public Level 2 charging stations, 190 public fast charging sites,6 and three public hydrogen fuelling stations. Since 2018, the number of fast charging sites across B.C. has increased by 55%. Another 1,900 charging stations were installed in homes and workplaces with the Go Electric Charger Rebates. Work is underway to continue expanding these networks.

To help reduce emissions from heavier vehicles, B.C. launched a Go Electric Commercial Vehicle Pilot Program. The government increased funding for its Go Electric Specialty-Use Vehicle Incentive in Budget 2020, which is available for eligible medium- and heavy-duty transport trucks, delivery vans, electric cargo bicycles, passenger buses, and low-speed utility trucks.

Together with the BC Trucking Association, the Heavy-Duty Vehicle Efficiency Program completed its first year, exceeded training goals and providing over $1 million for equipment.

US Big Corporates Push for Zero Emissions Vehicle Regulations

With a President-elect pledging to take meaningful action on climate change, Corporate America stands ready to act and take advantage of pro-renewables and clean-tech policies. The Zero Emissions Transport Association (ZETA) is a new federal coalition “advocating for national policies that will enable 100% electric vehicle sales throughout the light-, medium-, and heavy-duty sectors by 2030."

Comprising some of America’s largest corporate entities ranging from Tesla and Rivian, through to Uber, conEdison and Duke Energy, ZETA wants to see the full adoption of electric vehicles to secure American global EV manufacturing leadership, and reduce carbon pollution and therefore, emissions.

Policy goals of ZETA include:

• Expanded incentives, which means not only lifting the per-manufacturer cap on the $7,500 consumer tax credit, but also making it a "point of sale" rebate. Other goals include a program to incentivize trade-ins of fossil fuel-powered vehicles.

• Federal emissions and efficiency performance standards that will send the "correct market signals" for faster electric vehicle deployment by the auto industry.

• New federal infrastructure investments and support for domestic manufacturing, and support for local pro-electric vehicle policies.

According to Joe Britton, the Executive Director of ZETA, “Transportation is responsible for more carbon emissions than any other sector of the U.S. economy. By embracing EVs, federal policymakers can help drive innovation, create hundreds of thousands of new jobs, and improve air quality and public health.”

ZETA believes that consumer incentives drive adoption of new technology, and represent one real way to drive the shift to EVs in the US. Providing credits for older combustion engined vehicles will help to speed the transition, and will also boost domestic economic growth. ZETA hopes that a Biden administration would use policy mechanisms to encourage job creation in the EV manufacturing and supply chains. Biden has already stated that he wants the federal government to move towards a 100% clean energy fleet, and wants to work closely with state governors and mayors to roll-out 500,000 new public chaging stations by 2030.

Electric car sales are increasing in market share across the world, while conbustion-engined passenger car sales are slowing. This has been further exacerbated by the Covid-19 pandemic. The overall market share of plug-in vehicles is still relatively small however, comprising 326,000 or 2% of the total market in the US in 2019, 564,206 or 3.6% of the total market in Europe, and 1,180,000 or 6.8% of the market in China.

For more information visit https://www.zeta2030.org/

Source: Axios

Image: ZETA

Image: ZETA