The Albanese Government is delivering more cars that are cheaper to run, giving motorists choice by introducing a New Vehicle Efficiency Standard for Australia.
The United States has had a similar policy in place for fifty years. But because of a decade of delay and denial, Australia still stands alongside Russia as one of the only advanced economies without the Standard. This is costing families and businesses thousands of dollars at the petrol pump.
The Albanese Government’s New Vehicle Efficiency Standard will push car makers to give Australian motorists more choices of new cars, utes and vans that use less fuel and that have until now only been available to buyers in overseas markets.
The preferred model for the New Vehicle Efficiency Standard, made available today on cleanercars.gov.au, has been under development since the Government committed to the Standard last year – to ensure it strikes the right balance in giving Australians more choice while using less petrol.
If Australia catches up with the Standard in the U.S. by around 2028, Australians stand to save about $1000 per vehicle per year.
The Standard will only apply to new passenger and light commercial vehicles, not used or existing vehicles. They work by providing car companies with targets for average emissions per kilometre from new vehicles sold.
The New Vehicle Efficiency Standard will deliver more vehicles to Australia with the latest engine and design technologies to ensure lower fuel bills, meaning bigger savings at the petrol pump.
The Albanese Government will consult on the preferred model for a month and introduce the legislation as soon as possible, with the new cost saving rules to come into effect by 1 January 2025.
The Impact Analysis and ways to have your say are available at cleanercars.gov.au.
Minister for Climate Change and Energy, Chris Bowen says: “Because of a lack of action on an Efficiency Standard, Australian families are paying around $1000 a year more than they need to be for their annual fuel bill – the Albanese Government is delivering long-term cost-of-living relief to fix that for new vehicles and put money back in people’s pockets.
“We’re giving Australians more choice to spend less on petrol, by catching up with the U.S– this will save Australian motorists $100bn in fuel costs to 2050.
“This is about ensuring Australian families and businesses can choose the latest and most efficient cars and utes, whether they’re petrol and diesel engines, or hybrid, or electric,” Minster Bowen said.
Minister for Transport, Regional Development and Local Government Catherine King says: “The Albanese government favours a model which ensures achievable change, which will bring Australia in line with US standards by 2028 and provide the optimal cost benefit outcomes for Australian car buyers.
“The standard increases choice. It doesn’t dictate what sort of car or ute people can buy but will mean you have a wider range of modern and cheaper to run vehicles.
“As you make the choice about your next car, it’s only fair you have the widest range of options possible to get the car that is right for you and right for your hip pocket,” Minister King said.
The Electric Vehicle Council congratulated the federal government on driving Australia into the global mainstream through the introduction of New Vehicle Efficiency Standards, promising greater choice and lower fuel bills for Australian motorists.
New Vehicle Efficiency Standards (NVES) incentivise car manufacturers to ensure all new cars they sell, on average, meet benchmarks for efficiency. This means manufactures can still sell vehicles with heavy emissions, but they must be offset by sales of low or zero emission vehicles.
NVES have ensured that drivers in North America and Europe have been offered maximum choice, including the best and most efficient new vehicles on the global market. Australian cars use a third more petrol than American cars on average.
“Because previous federal governments failed to introduce New Vehicle Efficiency Standards, some car manufacturers have treated Australia as a dumping ground for their most inefficient models,” says Electric Vehicle Council Chief Executive Behyad Jafari.
“This announcement from the federal government, when legislated, will give Australians a greater choice for the cars they want and put money back in their pockets through lower fuel bills.
“Within a few short years it will mean the average family will not have to spend as much on imported petrol, which we know is hugely volatile on price.
“Australia has always been at the back of the queue when it comes to the best and cheapest electric vehicles, because car makers have been incentivised to offer them elsewhere first. That should end now with this policy, and Australian car buyers should notice the change very quickly.
“By bringing Australia into line with the US and Europe, car manufacturers will now be incentivised to offer Australians their best zero and low emission vehicles. Motorists will still have the choice to buy what they want, but they will be offered much better options to choose from.
“Right now Australia is one of only two developed countries without new vehicle efficiency standards. Very soon, Russia should be on its own.”
