Petrol and diesel vehicles’ days are numbered in Canberra, the ACT Government has announced. Many international carmakers have announced they will no longer make petrol engines by 2035, many countries have pledged to phase out sales of fossil fuel-powered cars, and the local government has seen the writing on the wall.

By 2030, 80 to 90 per cent of new vehicles sold here will be zero emission vehicles, while come 2035, no new petrol vehicles will enter the market.

“Many people will replace their vehicles over the next 10 years,” Shane Rattenbury, energy and emissions reduction minister, said. “We’re not going to take vehicles off the road, but we want to stop new petrol vehicles coming into the system to stop the problem getting worse; then, we can focus on transitioning those older vehicles out.”

The new policy targets light vehicles, which make up 95 per cent of transport in the ACT. ACT has a goal of net zero emissions by 2045; more than 60 per cent of the ACT’s greenhouse gas emissions come from transport.

The government will publish its electric vehicle action plan, building on a 2018–21 paper, later this week. But already opinions are sharply divided.

The Climate Council, a leading climate change communications organisation, said the policy set “a strong example of climate leadership for the rest of the country to follow”.

“Australia has been stuck in the slow lane when it comes to electric transport uptake, but the ACT’s game-changing policy to phase out new fossil fuel-powered cars is a welcome step forward,” Andrew Stock, energy expert and Climate Councillor, said.

“The ACT has set the bar for the rest of the country in reducing emissions from light passenger vehicle fleets, while also delivering lower pollution levels and a reduced reliance on expensive petrol.”

Similarly, the Electric Vehicle Council congratulated the ACT on its continuing leadership in supporting the decarbonisation of transport, and in particular, enabling the transition to electric vehicles.

Electric vehicles reduce carbon emissions and remove noxious pollution from neighbourhoods improving the air we breathe, reduce fuel and maintenance costs, support the creation of local jobs, and improve national security by being powered by 100 per cent Australian-made energy – as opposed to imported fuel, the Council argued.

International organisations, like the International Energy Agency (IEA), have outlined that globally we need to achieve 100 per cent electric vehicle sales by 2035 – at the latest – to achieve net zero by 2050.

“While several governments around Australia are aiming for the vast majority of new cars sold to be electric by the mid-2030s, we welcome the ACT’s leadership in being the first to formalise a target, and signal the end of petrol/diesel car sales,” a spokesperson said.

“This provides a reasonable timeframe for the community and industry to plan for this change, and capture the economic benefits of the transition.”

However, the Australian Automotive Dealer Association believes the policy will have “adverse consequences”.

Since electric vehicles are more expensive than fossil fuel cars, and there is not much choice in makes and models, “the big risk is that people hold onto their older, more polluting cars for longer, which will do nothing for reducing emissions,” CEO James Voortman said.

A technology-agnostic carbon dioxide standard would be a more effective way to lower emissions than “a crude ban” on internal combustion engines, the AADA argued. Nor was it clear how the ACT government would enforce the ban, or stop Canberrans buying internal combustion engines in NSW.

“Disappointingly, there has been no consultation on the major change, and automotive businesses in the ACT are left scratching their heads and asking what the future holds for them,” Mr Voortman said.

“We’re signalling right now goals for 2030 and 2035; we’re not springing a surprise on Canberrans,” Mr Rattenbury said. “We have been really clear about what the long-term direction is, wanting to give people plenty of time to get ready, plenty of time to make decisions, and plenty of time to make sure the industry is supporting that changeover.”

He predicts a big increase in the number of vehicles coming into the market over the next decade, and a fall in prices.

“I expect to start to see more vehicles coming into Australia, which will give consumers better choices, bring the prices down, and make sure there are more models available,” he said.

Similarly, the Electric Vehicle Council expects that by 2035, it will no longer be attractive to purchase most petrol or diesel vehicles, given a wide range of affordable EV alternatives will be available globally.

“This target is more than achievable, but we need nationally consistent EV policy to achieve it,” a spokesperson said.

The ACT is already leading the nation in electric vehicle uptake, at twice the rate of the rest of the country, Mr Rattenbury proudly said.

“We want to make sure that we go further and we begin the long-term transition.”

As of 1 July, 2,069 zero emission vehicles have been registered in the ACT – 900 of them in the last year. (But zero emissions vehicles still only make up 0.64 per cent of registered vehicles in the ACT.)

• ACT electric vehicle owners celebrate 1000^th registration (24^th July 2021)

Last year, the ACT introduced zero stamp duty on new vehicles, two years of free registration, and a $15,000 interest-free loan – “the most generous package in Australia”.

“The ACT Government’s EV incentives have already pushed the territory to lead Australia on the share of new EV sales,” the Electric Vehicle Council said.

• ACT leads Australia for electric vehicle incentives (2 July)
• Zero for zero: Interest-free loans for emissions-free electric vehicles (7 December 2021)
• It’s inevitable: Free registration for the electric cars of the future (24 May 2021)

More incentives will be announced this week, while a government tender for 50 public charging stations will be finalised soon.

“If you’re thinking about getting a new car, think about buying the car of the future,” Mr Rattenbury said.

Conversely, many big international carmakers have said they intend to stop making petrol engines over the next five to 10 years, he noted. “We need to position the ACT to be ready for that.”

42 per cent of the international market (by percentage of car sales) has already announced a ban on internal combustion engine sales by 2035, the Electric Vehicle Council noted.

Rolls-Royce will stop making petrol and diesel cars by 2030, Audi by 2033, Nissan by 2035, and Honda by 2040, while Hyundai shut down its internal combustion engine development team last year. At COP26 last year, Ford, Mercedes-Benz, General Motors, Volvo, Jaguar Land Rover, and BYD pledged to phase out sales of new gasoline and diesel-powered vehicles in leading markets by 2035, and worldwide by 2040.

Thirty countries also promised at COP26 to phase out fossil fuel cars by 2040. Australia was not one of them, nor would it offer rebates or tax breaks for electric and hybrid vehicles. Unlike other OECD countries, the ABC reported then, Australia does not have an emissions standard for car manufacturers, which makes it difficult for manufacturers to sell electric vehicles here.

• ACT will accelerate transition to electric vehicles (11 November 2021)

In fact, the Electric Vehicle Council last year described Australia as “a uniquely hostile market” for EVs. In 2020, EVs were only 0.7 of the million vehicles sold in Australia – compared to 10 per cent in the European Union and 75 per cent in Norway.

“We have been in a bizarre situation where the previous federal government actively campaigned against the clean energy technology of the future,” Mr Rattenbury said. “One of our biggest problems at the moment is the carmakers look at Australia and see it as a backwater. They don’t want to send vehicles here.”

The new Labor federal government, however, introduced an Electric Car Discount this month, which exempts electric cars from import tariffs and fringe benefits tax, and will develop Australia’s first National Electric Vehicle Strategy.

That strategy, the AADA believes, is “critical … to facilitate the transition”. In Mr Voortman’s opinion, the Federal Government – not the ACT Government – should lead the transition since it controls the importation of new vehicles into the Australian market.

Similarly, both the Climate Council and the Electric Vehicle Council want the federal government to implement strong fuel efficiency standards. These, Mr Stock said, would incentivise manufacturers to send cleaner and zero-emissions vehicles to Australia. Most OECD countries already have a Fuel Efficiency Standard which encourages greater supply of low and zero emission vehicles, including electric vehicles, the Electric Vehicle Council noted.

“The absence of a Fuel Efficiency Standard in Australia is leaving us at the end of the queue for EVs,” an Electric Vehicle Council spokesperson said. “The introduction of a national fuel efficiency standard remains the critical missing policy for securing more EV models, maximising the efficiency of EV incentives, and ultimately achieving our net zero target by 2050.”

Mr Rattenbury said the ACT Government will collaborate with the federal government and state and territory governments to make sure the changes are “consistent, easy for Australians to understand, give them plenty of warning, and make sure that we cut our greenhouse gas emissions”.

Read more:

• Electric vehicles pass the remote road test, ANU says (9^th July)
• ACT electric vehicle experience aims to help you make the switch (3^rd June)
• Free service to help ACT businesses buy electric vehicles (5^th April)
• ACT electric vehicles take part in smart charger trial (2^nd April)
• ACT leads the way for electric vehicles (28^th August 2021)
• ACT Government welcomes Uber support for electric vehicles (5^th May 2021)