Climateworks Centre supports the Australian Government’s commitment to introduce a fuel efficiency standard (FES) at this critical time for decarbonising transport.
Implementing a FES is a crucial policy for reducing emissions, accelerating electric vehicle (EV) uptake and meeting strong Australian demand to purchase EVs.
It will also improve the efficiency and reduce emissions of internal combustion engine (ICE) vehicles, making them cheaper to run.
It is critical that a FES be designed with its focus on meeting existing EV uptake targets and Australia’s legislated emissions reduction target.
Australia is starting from behind the pack on EV uptake, but can learn from countries who have already implemented a FES.
A FES can ensure Australia catches up with the global market, giving consumers access to low-emission vehicles at globally competitive prices.
Australia is not limited by its past low rate of EV uptake; conditions have changed to allow for significantly higher uptake as automotive technology maturity means manufacturers are able to meet a more stringent standard more easily than five years ago.
Climateworks Centre suggests setting a FES in the order of 95g CO2/km in 2024, and ensuring its design is simple, transparent, trackable and goal-oriented such that it is clearly linked to achieving Australia’s emissions reduction targets.
To be on track for a least-cost trajectory to net zero by 2050, a FES will need to reduce to 0g CO2/km by 2035 for all vehicle classes (IEA 2022).
Australian vehicles generally remain in use for 15 years, and so this timeline provides adequate time to achieve a fully electrified vehicle fleet that will support the national target of net zero by 2050.
This submission responds to the Fuel Efficiency Standard Consultation Paper and makes nine recommendations, providing detailed context to each recommendation.