Yesterday the government announced they are looking to bring in a feebate system for new cars that would see electric or plug in hybrid vehicles up to $8,000 cheaper which would be paid for by making vehicles with higher emissions up to $3,000 more expensive.
The Government is signalling its intention to slash the price of imported electric and hybrid vehicles by up to $8000 in a bid to make greener cars cheaper for Kiwis.
But it is also planning to slap a new fee of up to $3000 on the import of vehicles with the highest greenhouse gas emissions.
The Government has today opened a six-week consultation period before it introduces new legislation in Parliament later this year.
The plan, according to Associate Transport Minister Julie Anne Genter, will get more Kiwis into cleaner vehicles by reducing some of the cost burden.
It would come into force in 2021.
“Most Kiwis want to buy a car that’s good for the environment, but tell us the upfront cost and limited choice makes it a challenge,” she said.
The Government is proposing discounts of up to $8000 for zero-emission new imported vehicles, such as electric vehicles (EVs).
That number would be $6800 for plug-in hybrid electric vehicle (PHEVs) and $4800 for hybrids.
The level of the discount depends on the total net emissions of the vehicle.
……
Genter said the policy would be cost neutral – meaning the money gained through the fees from higher emitting vehicles would offset the subsidies provided to the lower emission cars.
“This means people will still have choice, while contributing to the task of cleaning up the vehicles coming into New Zealand.”
The policy would only apply to new and used cars being imported into New Zealand, not to vehicles already registered in New Zealand when on-sold.
Some 74 per cent of annual vehicles sales are of vehicles already registered and these would not be affected, Genter said.
On top of the capital cost savings, the government say:
“These policies are expected to save the country more than $3.4 billion in fuel and result in fuel savings of more than $6,800 over the lifetime of an average vehicle”.
This seems like a good start and it’s notable that already many commentators have come out in support of the plan, including the Motor Industry Association. It certainly seems a better way to encourage uptake of electric vehicles than silly schemes like allowing them in bus lanes.
Anecdotally I’ve been seeing a lot more electric vehicles around, especially Nissan Leafs. This is reflected in the numbers too with June seeing 648 electric or plug in hybrid vehicles being registered, the highest month so far. That has seen the total number registered in NZ to just under 15,000 and used Nissan Leaf’s make up over half of these.
As good as that is, it does need to be put in perspective. NZ has over 3.2 million light vehicles in the current fleet and even the newly registered EVs represent only about 2.5% of all new registrations. Interestingly you can also see that in general, registrations of new vehicles (new or used imports) have dropped since late 2017.
Here are a few thoughts I’ve had about the announcement.
- The additional cost of higher emissions vehicles doesn’t seem all that much in total. I wonder if there is also a case to make that a bit higher and use the extra revenue to include subsides for other types electric vehicles, particularly ones that also don’t contribute to congestion such as e-bikes.
- The government also need to look at how they can get more buses replaced with e-buses. That seems like it should be something much easier to achieve and would also help remove some of the nasty particulates that cause health problems.
- Light electric vehicles are currently exempt from paying road user charges (RUC) until 31-December 2021. It’s not known if this will be extended again but with the growth in the vehicle fleet, it’s going to be increasingly important that it isn’t as that will impact on the ability of the government to deliver its transport programmes. As it is, the Ministry of Transport estimate RUC is approximately $600 per vehicle per year so for the current fleet that’s about $9 million annually being missed out on.
- Even with the full $8,000 discount, it will still be hard for many people to justify the cost of an electric vehicle, especially if they’re using public transport, cycling or walking a lot.
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But why the wait until 2021?
It’s after the next election, they’ll either be in to implement it or out and it won’t happen.
Personally I think Jacinda will drop it just like she did the CGT.
No there is enough votes in this and the people it pisses off probably were not going to vote for her anyway. The beneficiaries are well off urban people who want to be seen as progressive. The losers are the tossers who by a ute to tow their boat but who claim they need it for work.
LOL
How many kiwi’s will be able to afford a new BEV to take advantage of the full 8K, I find this quite amusing, it’s a tax on the less well off which will only benefit the well off.
I have no issue making electric cars more attractive, but this isn’t the way to go about it. I don’t think there should be any subsidies on used imported vehicles, it should only be for new vehicles.
$1,100 off on a used 2009 Toyota Vitz is not bad. It’s not just about the extreme ends of the subsidies or fees, but all the middle ground efficient ones.
Indeed. We can expect to see sales of EVs plummet over the next 18 months, and sales of gas guzzlers to jump, as everyone waits for the discount or tries to avoid the penalty.
Hmm. Nice job, government.
EV’s sales will plummet from what, their present non-existent sales? Because…
Buyers such as Uber drivers will opt for a far more uneconomic car now just because they can to avoid paying more for a far more uneconomic car in 2 years…Yessss
Because doing so makes no sense to spend more on buying fuel for no other reason
To drain their bank accounts
To spite the government
Or my favourite, because they are idiots.
But more likely they will carry on regardless and for those who are currently fence sitting will update at all which is better again until the law change and why? Because this is a stimulus to encourage more economical vehicles and for some unknown reason for some that is just crazy shit in this country that most others have adopted long ago.
That “no rebate now” is not quite the level of disincentive/penalty you imagine it to be.
Lets compare a EV bought this month (July 2019) with the same priced EV bought in January 2022 after the scheme comes in.
Rebate worth for EV now: $0
Rebate worth for EV in 2022: $8K
No brainer right? Hold off, buy your EV in 2022? and save $8K
Not so fast.
Consider these facts:
EVs right now get free RUCs to the tune of $1000 or so per year, assuming RUCs are $72 per 1000 km (inc GST) and you drive 15,000 km a year on average.
So thats $2.5K right there that can be avoided by buying your EV now not in 2022.
RUC exemption for EVs goes away end of 2021. After that point all EVS pay RUCs so the playing field for all EVS is the same.
Then factor in 2.5 years+ of fuel cost savings – likely another $1000 per year. lets say its $2.5K
Calculated from assuming :15,000 km driven, and you charge your EV at home, off peak for 3 cents a km inc GST (easily done in most metropolitan areas of NZ), and buy petrol for your alternative efficient hybrid/petrol car which get 5 litres/100 km (or 20 km per litre) and petrol costs about $2.20 a litre on average over the next 2.5 years. (and ask yourself, do you reckon petrol will be $2.20 a litre in 2.5 years still?).
Electricity won’t rise that fast, or likely at all, companies like Meridian have 2-3 year “fixed price” plans where prices won’t go up in that time – when was the last time petrol was on a 2 year fixed price plan?
So fuel savings works out about $1500 for the petrol car in fuel, less $450 for the EV – both prices including GST in both calculation.
So $1050 savings per year, x 2.5 years = ~$2.5K.
So we’re now we have save (rounded down), $5K of that rebate value.
Now if instead of a hybrid you buy/have a “normal” 2.0 litre or above petrol car which has worse fuel economy – depending on age between 7.5l/100km and 11.0 l/100 km, then the fuel savings then will be at least $1500 a year in fuel or even higher. Could be as high as $2.5K a year.
Making the EV now side of the ledger at least another $1500 better off.
So that interim savings you have now becomes at least $6.5K instead of $5K.
You’re well over halfway there just on fuel and road taxes.
But I hear you say but a 2.0 litre Petrol car is more grunty than the EV – wrong. The EV will (even a lowly Leaf) will beat most comparable petrol cars.
Only thing your EV can’t probably do is tow a trailer. But then neither will the EV in the future for the most part. So not really a big issue if you’re buying the EV anyway.
Then lastly factor in include 2.5 years worth of lower [zero] maintenance costs and servicing costs of EVs due to less moving parts.
A new car will come with 3-5 years of “free” service included.
So that won’t make any difference $wise.
A secondhand Jap import likely won’t. So you’ll likely be paying $500 a year for oil changes, air filters + labour costs to do the servicing work
and such. I’ve assumed WOFs, tyres, brakes and such will not wear much differently in 2.5 years so will be the same cost so not included.
But servicing saves another $1K over 2 years.
So, if you buy an EV right now you can easily achieve $6K-$7.5K real savings “right now” and all before that future EV you might buy gets you a possible maximum $8K rebate.
Then factor in the time savings you’ll make over 2.5 years from never needing to visit any petrol station for fuel. I don’t know about you, but I’d put a value on that at likely $1K over 2 years.
And when we add up the EV now savings and compare with the EV in 2022 with rebate – that $8K you think you’re missing out on?
Doesn’t look quite so worthwhile or may in fact cost you money if you don’t buy one now.
And of course if you drive more than 15,000 km a year, or petrol goes up, you’ll save even more by having the EV sooner.
Petrol may infact come down due to less demand world wide with pickup of EV etc sales….then again distribution of it etc would become less economic.
Another minor factor is present day EV’s time saving in some transit lane on ramps.
I bet in the consulting period people will want clarity on the RUC issue.
I doubt petrol will go down in price unless there is another worldwide recession or something drastic.
If it does, the taxes on petrol will be increased to put the price back up for sure. Too tempting not to do so to local and central government politicians.
That NZTA controlled T2/Truck lane exemption for EVs is of limited benefit, I can think of maybe 3 on ramps that offer that capability. I don’t use any of them.
Someone might put a small value on them if they used them, but so you get onto the motorway a bit quicker, but then you’re stuck in the thick of it with every other motorway driver.
And how much is that worth as a time saving over all the other benefits of EVs.
I can’t see oil price will be down because of EV. EV won’t be easily accepted in most countries for the cost of EV is too high and insufficient back.
Thank you for the detailed analysis. I dare say you’re a lot more rational than the average new car buyer 🙂
The equation may change a bit if you’re financing that car and paying compounding interest on that $8k. For example, if my maths is correct, 60 months at 7% will cost you over $3k in extra repayments on top of that original $8k.
Once the policy is actually turned into law that removes the uncertainty and probably solves most of the issue. In the meantime, people (including me) will hold off on deciding what to buy next, and manufacturers probably won’t be rushing to bring new models to NZ until they can understand the full impact of the policy.
Can somebody wake me up in 2021?
The smartest decision is not to buy any car. They’re expensive assets to own and operate. No matter what makes them move.
But in the case of the rebate.
The money you save from buying your EV early you put towards paying the car off sooner by adjusting the monthly repayments higher from the beginning [you could pretty much increase your monthly payment by $160 a month by redirecting the money you not spending on RUCs and as much on Fuel each month into higher than required loan repayments. Resulting in less interest overall.
But even so its not going to require an extra $3000 in interest costs to fund a $8000 more expensive car due to no rebates for 60 months. If you compare the $72,000 car loan versus an $80,000 car loan for 5 years (60 months) the interest difference is quite low overall – $1500 (after all the bulk of the car price is still borrowed so its only the incremental interest cost that that extra $8K worth of borrowing incurs that is relevant.
Or you could simply “save” the savings up and at the end of 2.5 years you’d have saved enough to pay the loan off 4 months earlier, or structure the loan and make a lump sum payment during the loan mid way through to reduce the remaining interest.
The only benefit I can see from waiting is that you might get a slightly better range (or better equipped) EV in 2.5 years than you can buy today.
But likely only if its a secondhand Jap import one.
The current market leading EVs (Tesla Model 3, and offerings from Hyundai and Kia) are all near the $80K mark new and won’t be old enough to be available second hand from Japan in any decent qtys in 2.5 years.
The trade off by delaying doing something is that you will be leaving nearly $8k worth of potential savings on the table you can make now, by doing so compared to waiting for the $8K rebate to come along – that may never do so.
Without a retrospective rebate, I will see people who want to buy EV will hold off until the law pass.
What’s worse is people will all rush to buy the highly polluting cars before the deadline.
If this law got delayed, the short term damage will become a long term damage.
Yes slight worry.
I also note that if I import my own EV, I would not qualify for the subsidy. This seems…poor. I import my cars due to cost savings and the ability to access cars that simply don’t get bought here in volume. It would also allow consumers to sidestep any discretionary effects of the subsidies (e.g. vehicle prices increasing and consumers being no better off).
The Leafs are a problem. Their battery cooling tech is non-existent compared to others and the batteries require more charging by virtue of being smaller. Their capacity drops relatively quickly as a result. However there is a pilot program replacing dead/bad cells in Leafs being conducted locally, and I’d love to see support for the cottage EV/Conversion industry be considered as part of this.
Either way, now feels like the right time. There are more affordable options for EVs than ever before, and I feel like the use cases where people could switch to an EV previously were pretty limited. I would prefer the subsidy to abate with the vehicles value; e.g. be more generous if you’re buying a low-end Leaf than a Tesla Model 3, but that’s what submissions are for.
Yes this is an issue.
This allows car dealers to control the market and artificially markup the price.
Are you commenting from experience or quoting anecdotes? Yes the Leaf has no active battery temperature management and this can be problematic if they have multiple fast charges and discharges ie. on a long trip.
It must be remembered that the Leaf is essentially a city car where, after all, the greatest amount of car usage is. In daily use with overnight slow charging and the occasional fast topup the battery temperature is not an issue.
That’s why this rebate should no be allowed on used imported vehicles but only on new vehicles.
I fail to see your logic. Would you mind explaining.
Because I don’t think we should be subsidising old clunkers, as a country will get far more benefit subsidising new vehicles.
The owners of the the current imported EVs don’t consider them ‘clunkers’ nor has this been apparent in repair requirements.
Good summary.
I note whinging from some about this costing farmers more. Does farming simply have to translate into destroying the environment at all costs for minor short term gain, always?
And its the end of civilization as we know it for others. The fact their carcinogenic Hyundai Santa Fe dragging its lard butted 1800 plus kg around to the local school and or supermarket may be a little dearer is too much for the likes of Newshub opinion writers. And spare a thought for the obnoxious Ford Ranger/Toyota Hilux owners. The latest version of the latter suffers dreadfully from visible emissions with flawed diesel particulate filters.
This very cautious – timid – little toe in the water attempt to finally try and do something miniscule toward climate change really highlighted how backward NZ really is.
Can’t business owners (farmers, tradies etc) just write off the cost of a new vehicle as a business expense anyway?
There are already a couple of electric van options available. Electric utes are in development. It seems very likely that by 2021 there’ll at least be PHEV utes available.
So by the time this is implemented there shouldn’t be much to complain about.
Try being a courier and using one of those vans all day long, the Nissan has about 200km range, a courier drive will often do this and more in a day, with very little time to stop and recharge.
The only BEV ute I know about is the Tesla, that’s not going to be cheap and is still several years away from production.
Most vans aren’t courier vans. They’re widely used for tradespeople who drive to a work site or small number of work sites each day. Couriers won’t need any encouragement to jump in BEV vans once they become available with practical ranges for their use: The fuel cost savings will be too large to ignore.
Mitsubishi has already shown a hybrid Triton concept. The other ute manufacturers won’t be far behind. Tesla is developing a BEV ute. Rivian reckons they’re starting production of their BEV ute in 2020.
We have electric rubbish trucks now that drive all day and stop and start continuously, surely there is scope for electric courier vans. NZ Post already use a small version of one.
Deadline Couriers in Auckland have at least one Leaf. I spoke to the driver one day and was told that it depended on what route it was on but generally it could most or all of the day on a full charge (overnight) but may need a fastcharge topup some days. This could be say 15-30 mins = lunch break?
No, you cannot write off the purchase of a capital asset as an expense.
You can write off some of it https://www.business.govt.nz/tax-and-accounting/reducing-your-tax/claiming-expenses/
No, you can’t. A capital asset is not an expense. They are literally different things. The running costs of the vehicle and depreciation are expenses. The purchase price is not an expense.
I think you can write of 30% of the remaining capital value each year as an expense and 21% if you use the straight line method. I think the diminishing value method seems to be closer to the actual value and avoids you having to pay too much back later if you sell the car for more than book value.
So…depreciation. That’s a normal expense. It’s not ‘writing off the purchase as an expense’. You can only do that if something is under $500.
Worth noting that EVs do not seem to depreciate at the same rate as petrol-driven cars. Too soon to say whether this is due to supply or tech constraints as things stand.
Can a lease vehicle be shown as an expense for tax purposes?
Many business lease their vehicles rather than purchase them for this reason.
The costs of the lease are fully deductible as “operating costs” each year and there is no depreciation or need to get rid of the vehicle at the end of the lease – it just gets returned to the lease company.
But it does lower your taxable income. You don’t have to pay tax on the money that you paid for the capital item. Plus the GST is definitely set off against GST taken in.
The purchase of an asset is not a tax-deductible expense.
Yes those poor farmers might have to use a tractor for off-road work and an efficient car for trips on the road. How will the poor dears cope?
If this reduces the number of wankers using small trucks as their runabout car then I am all for it. You see these pricks in every carpark where they make it impossible for the car parked on the the other side of the aisle to get in and out of the space. My only complaint is $3k isn’t enough. It should be $5k to $10k depending on whether the deck has ever had dirt on it.
+1
$3000 over how many years of ownership? There are some that wouldn’t get out of bed for that.
This is a good plan, I just hope it doesn’t cause fewer EV sales while people wait for the discount to come in. There should be scope for adjusting the amounts each year to influence the market too.
There is an RNZ interview with the IMVDA head, where he supports the retail level feebate, but is dead against the proposed importer fuel efficiency requirements. Vehicle importers made the same argument when various safety standard restrictions were introduced. Their industry certainly didn’t collapse.
I think it’s a fragile argument that the import restrictions will be “draconian”. Other countries manage very similar rules, and we already have Euro4 as a minimum standard.
https://www.rnz.co.nz/news/national/393967/clean-car-discount-supply-standard-ignores-consultations-imported-motor-vehicle-association
I heard this interview. The unsaid elephant in the room from the interview (and with this policy generally) is that actually we would benefit a lot from fewer cars and are likely to need that to hit emissions reduction targets. Therefore policy options should be explicitly about reducing the size of our fleet over time at the same time as electrifying the vehicles that remain. Active modes, micromobility and public transport can pick up the slack for movement in cities and on some selected intercity routes. You wont hear optimism from car industry types on that policy though.
Because of the incredible energy requirements to make all car types the best way to not impact the planet if you own a car is to not get a new one, EV or otherwise.
This announcement is bad for the environment, just makes the government look good.
Besides it’s the poor who buy cheap Japanese imports that will be impacted.
Put a huge import duty on all vehicles entering nz and force people to get away from a consumption based lifestyle.
Exactly George, EV’s are not good either despite what I read on RNZ this morning but we are mortgaged to the hilt to the motor vehicle industry for employment and prosperity.
But as stated in this piece, E or trolley buses can and should happen very quickly but it depends if this self declared climate emergency by AC is genuine or good ol’ window dressing politicking!
Put a huge tariff on inner-city areas that won’t intensify and force all the development out into the burbs first. Then we’ll talk.
I suggest watching Engineering Explained’s YouTube video “Are Electric Cars Worse For The Environment? Myth Busted” as to why this is not the case.
Video link: https://youtu.be/6RhtiPefVzM
I cant see how anyone can support this idea. This will be another govt failure, the only people who will benefit are those who can afford new hybrids and BEVs, and those who can afford new gas guzzlers are not going to be phased by a 3k additional charge, the people who lose out are the less well off who can’t afford to buy cars which get the best subsidy.
This will be quietly dropped IMO.
Errr, those with less wealth were never likely to import and new car anyway. It’s clearly about speeding the uptake of electric vehichles into the NZ fleet, which in turn trickles down through 2nd, 3rd hand models..
What IS your solution to anything? Other than trying to rename every country Norway.
If it is something designed to speed uptake, why wait 2 years to introduce it? Why not just enforce it on the cargo of any ship arriving after midnight?
This also avoids the problem of those like myself that will now be delaying their car purchase.
We shouldn’t be importing used electric vehicles into NZ, we end up with other countries old junk. Leafs with bad batteries and the like. It’s ridiculous that the govt are proposing subsidising used vehicles!
We’d be so lucky if we were more like Norway but unfortunately we aren’t.
NZ already the biggest used market of Japan. Those phase vehicle in Japan will end up in NZ. Reason why? Poor NZer.
How nice of the CoL to help rich pricks into EVs while taxing the poor.
Helping rich pricks and Taxing the poor?
How so, The $3K [the maximum “fee”] only happens on top end newly imported gas guzzlers.
So its actually more the case of the Government is taxing the “poor” rich wankers buying these $100K+ gas guzzlers.
Not that the poor folks buying said vehicles will likely notice the impost. As depreciation and other costs like fuel will more than overtake the fee after 1 year.
Second hand cars (like used Jap imports) will get charged or rebated a whole lot less than that. Most of the “common” (popular) jap imports will in fact either have no rebate or a modest one.
As for the “rebate” part – only poor people buying $80,000 or less brand new EVs will claim the full rebate.
Don’t know about you, but the only “poor” I can think of who would be able to be buying such “expensive” EVs will be those seeking to live in them instead of renting or buying a house in Auckland.
I’m happy that the government may have finally, belatedly, and a bit halfheartedly decided that NZ should incentivise EVs sales. Nearly a decade after much of the rest of the world made the same decision https://en.wikipedia.org/wiki/Government_incentives_for_plug-in_electric_vehicles.
I’m a bit puzzled though that they also want to incentivise sales of so called “low emissions” fossil cars. The policy should be more focused, but never mind. It is better than doing nothing.
The $80K limit actually looks like the worst part of the policy. Many EVs on the market today hover around or just under that limit. Prices may fluctuate based on the NZD rate, and availability of raw materials for things like batteries, which may push some cars over the threshold. These cliff edge relative price distortions may lead to some cars disappearing from the NZ market completely. We could end up with less choice overall than if there was no clean car discount, and that is only going to slow down the adoption of EVs. Some manufacturers may chose to create crippled versions of their cars to get under the limit, such as what Tesla has done in Canada https://cleantechnica.com/2019/05/02/tesla-gets-creative-for-model-3-customers-in-canada/. This is just plain bad policy.
I don’t buy the arguments about helping “rich pricks” at the expense of the poor either. Many of these more expensive cars will end up in the second hand market after a few years. A vibrant local EV used car market with a large range of available models is what will truly make EV ownership a realistic option for all New Zealanders. The technology is improving rapidly and that $80k car will probably be sold on for a tiny fraction of that price a few years later, making EV ownership possible for a new family that may otherwise be driving an old gas guzzler. That new owner then benefits from the hugely reduced fuel and maintenance costs that go along with EVs. Without that car available on the used market, that family may be stuck paying for petrol. Further, reducing reliance on imported oil will offer economic benefits to all NZers, regardless of who owns the EV.
Finally, the overall aim of the policy must be to reduce NZ’s green house gas emissions. Everyone in NZ (and around the world) stands to benefit by having less polluting cars on the roads in our cities, and lower carbon emissions across the fleet. From that perspective, it really doesn’t matter who is buying an EV, whether they are a rich prick or not. That new EV means that one less petrol car was built and sold, NZ imported less oil for the lifetime of that vehicle, and the lifetime emissions from that petrol car will never be released into the atmosphere. Labour/Greens should not be confusing climate policy with social policy. Although demonstrably EVs are a social good, regardless of who the first owner of that vehicle is. The folks driving around in monster SUVs today are never going to drive Leafs or Zoes, but if they want to buy another new SUV lets encourage them to buy a Tesla Model X or a Rivian.
Pollution and climate change impact the poor the most. Think about that poor family living alongside an Auckland motorway. Rich pricks driving EVs actually helps them a lot.
I like to think of this policy as actually exploiting the “rich pricks” in order to benefit the rest of us.
Largely agree. I can’t see any reason to exclude expensive EVs, they will end up in the 2nd hand market at some stage. If they are anything like Mercedes, BMWs and Range Rovers they will be pretty cheap too, no one wants an old formerly top of the line car.
“I’m a bit puzzled though that they also want to incentivise sales of so called “low emissions” fossil cars. The policy should be more focused, but never mind. It is better than doing nothing.”
It has to go hand in hand with feebate scheme/policy – because we have no emissions standards (or fuel economy standards) with regards imported vehicles. We, along with Australia and Russia being the only 3 developed countries who don’t have such rules.
As a result we risk becoming dumping grounds for vehicles that vehicle manufacturers can choose to “dump” here not being able to sell them in the UK or Japan etc due to ever tightening emission rules.
So clearly the government realises the world won’t go fully electric by the time the rules come in. So the majority of the existing and newly imported fleet will remain fossil fuelled – for now anyway.
However, while it stops us importing the rot. It doesn’t do a thing about the crap cars we already have in our fleet (both new and not so new), which will continue to pollute the planet for 19 or so more years – on average.
So in a way “this is a small step for a country, and most definitely no giant leap for humankind”.
That’s funny, because I can’t see how anyone can not support this idea. I don’t feel that sorry for the supposed ‘less well off’ who are buying brand new gas guzzling cars. Smaller/cheaper cars are getting the subsidy too.
Probably because it also applies to used imports as well?
That would be good. Buy a secondhand Nissan Leaf for $10,000. Get $8,000 discount. But I don’t think it will apply to used imports? Rather, I think the main benefit will be getting Nissan to sell new Leafs in NZ again and thus start supporting the market. There are quite a lot of Leafs around now, but almost all of them have been imported secondhand from Japan (where they have been subsidised for us by the Japanese government). Nissan couldn’t sell them new (too expensive) so pulled out of the NZ market and haven’t provided any support with regard to the imported cars. The missing part of the puzzle will be battery replacement/reuse/refurbishment. And that may be best coming from Nissan (as they do in other markets where they sell new)…having said that, there are enough of them that someone else will provide the service if not.
Vector is currently investigating a Nissan Leaf battery recycle program at the moment which might help too.
http://www.scoop.co.nz/stories/BU1907/S00144/vector-eyes-late-life-ev-batteries-for-home-storage.htm
There is an NZ company with a design for a Leaf replacement battery. At present there is not enough demand but this will likely occur. The battery design has 80% greater capacity than the original using different cell technology.
Does it? I think I initially heard that too, but the article I read specifically said new cars.
‘The policy would only apply to new and used cars being imported into New Zealand’.
Looks like it applies to used imports as well.
The discussion document says a used EV would get a $2600 bonus in 2021 ($8k for a new car) and that would reduce to $2100 in 2028.
Those new hybrids and EVs will eventually become cheaper used vehicles. Also as the EV market becomes more mature in Japan there will be more cheaper EVs available in the 2nd hand import market.
I agree there will be some short term distortions as there is with any change but it’s a pretty poor reason not to make changes.
As usual you have plenty of criticisms but are playing your solutions close to your chest.
How long? Ten, twenty years? Or longer? By NZ alone, we are just a small bit to the market! International also not enthusiastic yet on EV, how come the price can come down in the foreseeable time!
I support this. The idea is to change the makeup of the vehicle fleet and to do that you have to target people who buy new cars, the wealthy and fleet buyers. This must have an impact on their decisions. However it probably isn’t going to make any noticeable difference to global warming or climate change or whatever. That horse has bolted and the old climate is gone. If you look and the small part NZ plays in global emissions and even smaller part $3k might play in decision making then the impact will be so close to zero we may as well round down and say it will have no impact.
I support this program because it is a step towards fuel self sufficiency for NZ, and that is a worthy goal. Fossil fuel trade has been the cause of wars, suffering, poverty and dictatorships. If we can opt out even a bit then we will have done our part to make the world a better place and our country safer.
Plus: NZ is a country which generates most of its electricity from renewable energy, so EVs make sense here. Some countries with high EV uptake generate a lot of it from coal and other less-preferable sources, so the benefits are much reduced there.
I heard an interview yesterday with the dog and lemon guide guy. Interestingly he said that although he had been a Green party supporter all his adult life he could not support this measure as he thinks it will produce completely the opposite result to that intended. He bases this on what happened with the carbon emissions duty – people held on to their cars rather than replacing them which meant a decline in the turnover of the very vehicles the duty was designed to eliminate.
He accepts it is counter-intuitive but felt that this was misguided and govt should be looking at making ev’s more attractive and easier to own rather than this.
As an aside I wouldn’t own a Nissan Leaf if you paid me to. They just look inherently unsafe and with the poor driving behaviour of Akl drivers they look to me like a mobile coffin.
I look forward to the day when I can simply go carless
‘They just look inherently unsafe’
Well I’m glad as a safety professional you’ve visually looked at one of the best selling EVs from one of the most reputable car manufacturers in the world and decided, through eyeballing only that its unsafe. Will avoid…
The 2011 MY Leaf is a five star ANCAP vehicle.
The 2018 MY Leaf is a five star ANCAP vehicle.
There have only ever been two iterations of Leaf and they’re both rated five stars.
I quite like the idea of a car with a big crumple zone up front that is going to protect me in a crash, rather than a big solid lump of metal fossil engine that is going to be pushed back into the cabin by the impact and kill me.
A low centre of gravity from the big battery under the floor also sounds kind of nice, so I know the car won’t flip over and kill me if I have to swerve to avoid something.
Matt hit the nail on the head with subsidies for e-bikes etc, we shouldn’t be letting the Motor Industry decide how we tackle Climate Change for a second longer…
Cars of course exist but Government should be investing their money in electric car share schemes or helping companies start up, infrastructure for small and personal mobility and reducing plans to reduce vkt. Like dm says, look forward to getting rid of the car, despite the fact I don’t use it too often.
Sadly this scheme is just window dressing – timid as you say Waspman. What is worse, there is no guarantee that it will reduce total vehicle emissions!
Over the past few years individual vehicle emissions have fallen from about 220g/km to about 180g/km. Over the same period total vehicle emissions have increased massively due to more roads, more cars and more distance travelled. It’s all about vkt as Heidi correctly says. The feebate doesn’t address this.
If this is a response to a climate emergency then its rubbish – akin to the gun buy back looking to purchase 173 guns, maybe less.
Wouldn’t a better approach be to recognise that we need less cars? (Did we address the plastic bag issue by saying we should have smaller bags?) Lets have a scheme that induces some people to abandon their cars, or at least use them less by providing viable zero carbon options like trains, or more friendly options than cars such as buses, and preferably electric buses.
What about a modest fee on the purchase of all fossil fuelled vehicles (not just those new to NZ) and use this to predominantly reduce public transport fares and also provide public transport infrastructure? Maybe we should be taking the lead from Europe where cities there have huge numbers of people using public transport to the benefit of the environment and the family budget? We need bold measures to fix a huge problem.
We need measures that are not just a transfer of wealth from the poor in outer suburbs with little choice but to drive (in a climate with no desire to implement rapid transit options) to wealthy inner city suburbs that have 10 minute service intervals and predominantly 830 – 5 white collar workers.
BW, nothing is more certain than that the price of carbon and hence petrol will become more expensive. There is also nothing more certain also than that the government won’t compensate people so that they can continue to drive the same amount. In light of this, a scheme that gives people the same public transport cost in outer suburbs (i.e. a one zone approach) is likely to be enormously helpful. The inner suburbs will subsidise the outer suburbs and if those in the outer suburbs use PT there will be better frequency. I get why someone in Albany currently uses the bus way less than someone in Takapuna – its way more expensive.
I have always advocated a single zone that might spread from say Albany to Manukau and significantly out west. Beyond that will be another zone. Systems like this work enormously well overseas and seem to be affordable for cities to manage.
If you have better alternatives put them on the table.
But again you’re taxing the poor and the well off simply won’t care.
My alternative is to build the West Light Rail that NZTA haven’t even got a business case for yet. Or any sort of rapid transit. Don’t expect people to keep paying fuel taxes, vehicle taxes and then give them no alternative to so Grey Lynners can swan about in Tesla Model 3s.
No offence, but your public transport subsidy is not that much use for people out West, who were promised a Light Rail network when it suited politically and have basically lived in a vacuum ever since.
It’d be great for the people who actually have access to frequent public transport though. Remind me, where do those people predominantly live, and how much of the housing burden are they taking on?
Why not have both? An approach that improves access to quality PT, cycling and walking and also an approach that ensures that the cars that remain will produce emissions.
I don’t recall anywhere in this announcement from the government that they had decided not to focus on PT and only on EVs.
Jezza,
I accept your point that this doesn’t preclude a PT announcement. But when? It is 20 months into the term and the concrete proposals to address the nuclear moment of this generation are ….?
My main concern is that PT improvements require money and quite a lot of money, hundreds of millions annually, and it is not apparent where this is coming from. The less sources that there are for this revenue then the less likelihood of it happening.
Construction has started on the Eastern Busway, a project that was going nowhere under the previous government.
Construction will soon start on BRT between the Airport and Puhinui, a project that wasn’t even in the pipeline under the previous government.
Next year we will have trains between Hamilton and Papakura, a plan that wasn’t even in the pipeline under the previous government.
I agree change isn’t happening as fast as we would like but you can’t credibly claim nothing has happened in 20 months.
How long do you think the trains between Hamilton and Papakura will last? 3 return services per day, old clapped out Silver Fern railcars, a return ticket of approx $40, I doubt they will be running for long, just like the last time it was tried.
If this is to be done it should be done properly with new rolling stock, upgraded stations, and significantly better frequency.
The NZTA has committed to subsidising the service for five years, by then it will likely have been extended to Puhinui and probably either Otahuhu or The Strand. This improved service will see admittedly small volumes grow, which is the most important thing.
There is no way the NZTA would be subsidising this service if they weren’t in it for the long game, as you say it doesn’t stack up initially. If you go back 20 years Auckland suburban rail was a service with low patronage, requiring an 80 % subsidy, things have certainly improved.
The current suburban Auckland rail network has nice new trains along with frequency and upgraded stations, this service will start with poor frequency, clapped out stations and ancient railcars long past their use by date, with no prospect of new rolling stock with decent facilities.
What you have described is exactly what the Auckland suburban network was like 15 – 20 years ago, you have to start somewhere.
Also not sure where you are getting the idea that the Silver Fern railcars are being used, they are certainly not part of the plan.
Masterchief you are mistaken, this service is starting with 11 newly rebuilt carriages and three rebuilt locomotives, not ancient rail cars.
But yes it will start with poor service levels and old staitons. Well except for the brand new station they a building in Hamilton for it, and the Papakura station which is already rebuilt.
Saying we have to start with new trains, new stations, wonderful service levels is what stopped Auckland upgrading it’s trains for 70 years.
Every decade since the 1930s there was a big plan to create a rapid transit system with double track, electrification, new train fleet, new stations and city tunnel and much improved service frequencies… and every decade that failed because it was hugely expensive.
We did it this time around, by starting small and doing lots of little steps over time… and now we are almost done with just the city tunnel completion and the third tranche of fleet to come.
Why are there more cars John? Oh yeah because our open door immigration policies over the past 20 years have added a net 1 million people to our country. Even if by some miracle half used PT that’s still half a million more people driving.
In your logic, The better way to eliminate emissions is to trim down the number of people in NZ, not to take new people into the country. The demand on transport reduced, than the demand for drive Nor public transport reduced, the emissions reduced. O, than there will be Zero emissions. What a Pure Country as well as mindset. Good to go.
NZ such a small village, even we all don’t drink, eta, travel, there’s nothing help to the world climate change. Wake up, dreamers!!
So we are back to subsidies and tariffs to plan the economy. I guess governments just can’t help themselves as they always think they are better at spending your money than you are. This will not be cost neutral as people will start to categorize things differently. Be interesting to see the true cost in a few years time.
Of course the industry would love a subsidy for some their products and hate the tariff on some of their products. This is back to the bad of days of winners and losers in the economy with industries lobbying their minister for favorable concessions and taxpayers money.
Is allowing petrol cars to ruin the environment a subsidy? Even if you aren’t a global warming believer, you have to admit that petrol cars have significant impacts on the local environment in terms of smoke/particulates/cancer/noise right? By not charging for those impacts, it makes petrol cars cheaper than electric.
A better comparison is probably with something like tobacco tax. Cigarettes place a burden on society, and ultimately kill people, so they attract a huge, punitive and regressive tax. Yet nowadays there is virtually no controversy about this, and rightly so. Rates of smoking are decreasing, and the tax is working.
Fossil fuelled cars also kill people and burden society so why not disproportionately tax them to discourage their use in a similar way. Even if the tax in this case is a paltry part of the purchase price, it’s better than nothing, and should eventually help to change behaviour.
It seems inevitable at this point as production of EVs is ramping up around the world, economies of scale, and problems like how to build bigger cheaper batteries are being solved, that EVs will have a tipping point some time in the next decade where they become cheaper than fossil fuelled cars, even without any discount. EVs are simpler and more efficient machines, with fewer parts.
However given that most people agree with the science that says we need to do something about climate change yesterday, and the long economic lifespan of cars of 20 years or more, it seems pretty reasonable that we should do something now to kick start things.
EVs aren’t attractive to buy in NZ at the moment not just for purchase price but because the infrastructure is poor. It’s a chicken and egg thing. There are few EVs on the roads, so the service centres aren’t there and the charging networks are poor and sparse compared to the EU and US. Giving EVs a modest kick start to help industry build out this infrastructure through the clean car discount seems like a pretty reasonable thing to me.
This is already demonstrated to work in other countries, some of which are not starting to roll back their EV subsidies as they are no longer needed. The saddest thing is that the NZ government decided to wait so long.
“The infrastructure is poor” ?
There are literally millions of charging stations with 3 pin plugs in every house.
Service centres – The service requirements on EVs are considerably reduced to that of ICE vehicles. Many owners report tyres and windscreen topups as the main requirements!
EVs are in some ways not just a different car but also a new way of thinking. Something that likely scares many.
> “The infrastructure is poor” ?
I was thinking about the lack of DC fast chargers that allow you to make a trip from one end of the country to the other. Note these are not the token (and largely pointless) trickle chargers that you find installed outside your local New World or Warehouse, but proper 100 or 200kW fast chargers.
It doesn’t matter if people hardly ever make these kinds of long trips. It’s just the kind of excuse that people come up with to avoid buying an EV. It’s not just the purchase price that factors into the decision.
(I’m picking on Tesla, only because they have a convenient online map, but there are other fast charger networks like https://ionity.eu/en/where-and-how.html):
Compare the Supercharger map for Norway:
https://www.tesla.com/en_NZ/findus#/bounds/71.30780000000001,31.35499989999994,57.8097,4.064899999999966?search=supercharger&name=Norway
With NZ:
https://www.tesla.com/en_NZ/findus#/bounds/-28.8773225,-175.1235077,-52.7224663,165.74376410000002?search=supercharger&name=New%20Zealand
Their population and land area is just slightly larger than ours, but the size of their total vehicle fleet is smaller than ours. All of those fast chargers essentially only exist because of their EV subsidies, and the resulting huge number of EVs on the road.
It’s also not a like-for-like comparison as they only recently started selling their most popular vehicle direct to NZ, but I think it demonstrates the point. There is a lot of infrastructure to build out to support a big fleet of EVs driving across every remote corner of the country.
> There are literally millions of charging stations with 3 pin plugs in every house.
Even considering home charging, how many rental properties for example come with a decent home charger installed in their garage? Like one of these https://www.chargemaster.co.nz/collections/evbox-charging-solutions-modular-smart-future-proof. Zero rental properties have these would be my guess.
Not many Rental properties tend to come with Spa pools either.
If as a tenant you wanted one, you get a portable one and plug it in to the mains with a suitable (high amperage) wall socket.
If you don’t have a suitable, normally an electrician can add one pretty easily and cheaply.
And when you move you take the charger with you. Leaving the wall socket behind.
Same with EV Chargers, lots of them will use a 15 amp or 32 amp wall socket. A 32 amp one [a stove plug for example] for example will give you some 7 kW of energy delivery.
It can be used as a regular 10 amp socket too.
One of those will recharge most of the under $80K EVs overnight at off peak rates.
How many properties in NZ, rental or private, don’t have bog standard 10A 3pin wall outlets? That is the way a large proportion of EV owners charge overnight.
At present there are no 100kW or greater non Tesla fast chargers in NZ. There is not enough cars to use them. If you look at Chargenet’s map on their site you can see there is already reasonable 50kWh coverage.
It’ll take a hell of a long time to trickle charge an EV using a domestic socket.
If you’re going to charge at home which in NZ due to the poor charger coverage you’ll have to I wouldn’t waste time with a domestic socket, you should spend some cash and buy something like the Siemens VersiCharge, it’s 230v 30amp unit and it will charge a Model 3 in about 4 hours.
Exactly. It’s not very practical having to wait 24 hours or longer for a recharge. Maybe it’s OK if you buy something with a tiny battery like one of those first generation Leafs, but then those extreme short range cars aren’t very practical themselves for a big chunk of the car buying public.
It’s especially bad if you’re on a time of day electricity plan and are trying to squeeze in all of your charging overnight when the watt hours are cheap.
One of those 7kW / 30amp chargers, and set it to charge between midnight and 4am, sounds about right.
From your comment it is apparent you have no experience in the EVs currently in NZ. They can, and are, charged overnight plugged into standard 10A outlets.
We got our one from https://smartevchargers.co.nz/ it can fully charge over night with no issues.
When I first read a headline yesterday, I thought this was about making the annual cost (rego) of higher emission cars more expensive, and I was celebrating in my head.
Reading the details, I’m a bit disappointed that this is only for new imports.
It’s time to send price signals that SUVs should not be the dominant type of cars on our roads by making the rego costs dependent on the emissions of the car.
Yes because this applies to new to NZ vehicles (imports whether new or secondhand), that means the vast existing fleet is given a free ride forever.
What we need is an ancilliary scheme like this for improving the existing fleet:
1. Annual vehicle regos go up $100 a year, every year after the car reaches a set age e.g. 5 years. e.g. rego in year 6 is $100 than year 5 rego is, rego in year 7 is $200 higher than year 5 rego is etc.
This is done to account for an aging cars higher and higher pollution levels that older cars emit both due to aging of the vehicle and the availability of lower (or zero) emission vehicles.
The money collected by this registration levy scheme is used to set up nationwide fleet emissions testing regime that is used in part 2.
2. Vehicle owners subject to higher rego levy can request a free or mostly subsidised emission test. If their vehicle pollution levels are comparably lower or as low as a then “new” vehicle fleet emission “weighted average” standard (e.g. 105 g/CO2 km in 2025) then their rego is reduced back to the same a new car registered would pay. It can then resume its upward $100 a year increase after a smaller interval say 2 years. Unless retested before then.
3. If your vehicle shows it has excessively high emissions (relative to the Registration fee you are paying for it). Then your registration may be declined until you get the car fixed or you can agree to scrap it for a modest payment.
Over time the old, polluting cars will be “tested out” of the fleet in a timely fashion. While those who persist in driving poorly maintained old dungers learn the cost of doing so.
Any money left over from the registration fees for the emissions testing can be used to fund the “cash to scrap” older cars scheme. Whereby you can surrender your car for a modest cash payment. Unregistered cars won’t be eligible to stop people driving cars around that are unregistered and then scrapping them once caught.
This is exactly how it works in the UK and many other countries. Annual vehicle tax / registration is based solely on CO2 emissions of the vehicle: https://www.gov.uk/vehicle-tax-rate-tables/rates-for-cars-registered-on-or-after-1-march-2001.
Combined with compulsory insurance, it definitely succeeds in forcing older more polluting vehicles off of the roads.
The saddest thing about NZ is that policies like this are so politicised. Overseas it is normally just viewed as common sense and won’t lose you an election because the other guys definitely won’t roll it back.
Thanks, that’s really interesting.
One of the problems I have with the government’s proposal is that it deals only with carbon dioxide, ignoring all other pollutants. Depending on the phase-in rate, that creates the not-very-comical possibility of subsidies for the import into New Zealand of used light diesel vehicles which are subject to restrictions in some cities in Europe because they don’t meet Euro 5 emission standards.
I own a light diesel vehicle, but I’m not sure we should be planning to subsidise their import in a number of years’ time.
The right place to apply the feebate is at the point where the consumer can respond to the price signal. That would be the point of vehicle purchase.
A feebate on the annual cost (rego) would be largely a waste of time. The rego is paid and quickly forgotten; the vehicle owner is hardly in a position to do much about it at that point.
I would say the right place is at the time you buy petrol. But unfortunately it is political suicide.
+1
The best place for the price signal to apply is at first to the importer.
Then secondly to the subsequent purchasers of any vehicle.
That way only the better less polluting cars get imported in the first place.
When any old piece of junk car is imported, it will be sold and resold and pollute the whole time.
So the best plan is stop the junk coming in first.
“The rego is paid and quickly forgotten”
If you can afford it
So instead you don’t register… many don’t
Correct
+1
Does the subsidy reduce over time and only start as $8000 for an EV? Appendix 4 shows the subsidy reducing to $4200 in 2028.
https://www.documentcloud.org/documents/6184103-LEV-Consultation-Document-Final.html
Its supposed to be self funded on a year to year basis.
So the projections assume the overall mix of new imports will get more efficient over time, leading to less “fee” money in the pot to pay the rebates.
And if for a minute we imagined that all the cars imported in 2028 were (magically) all EVs and no fossil fuelled ones at all, there would be $0 in fees to hand out as rebates.
>•Light electric vehicles are currently exempt from paying road user charges (RUC) until 31-December 2021. It’s not known if this will be extended again
It is not being extended, buried in the Feebate documents is this
“The Clean Car Discount will be timed to replace the exemption from road user charges that applies to electric vehicles…..”
This will increase to running cost of an EV will increase by $72/1000km….
Which means, the government will claw back the “rebate” via RUCs within 8 years if the average light-vehicle EV travels 15,000 km per year.
Clearly the RUC scheme needs to be reviewed as part of this – 7.2 cents per km to drive your EV on the roads while you can pay less than 3 cents to fuel it makes the EV from 2022 onwards less cost effective than an efficient hybrid you can get now.
Indeed my Honda Hybrid costs me about 10 cents a km to drive now, and that includes the Petrol and fuel taxes (which includes the road tax money used for the same purposes asRUCs).
Clearly this policy has a few rough edges.
I think the greater effect here, if other, larger countries see fit to implement such measures, that car manufacturers will be forced to convert to producing more EVs. This will naturally include utes and Tesla like SUVs, with a lower price tag. Those that are against such a move, are indeed the backwards factors of this country, likely those that oppose light rail too. And if EVs are still too expensive for public transport users and cyclists, this may not be a bad thing, as congestion will not be fixed by replacing every fossil fuel vehicle with a cleaner renewable energy powered version. Better ideas is community ownership of EVs, as one apartment building has already done, whereby neighbours can part own a vehicle. In most cases four households could make one vehicle work. Weekends away may be limited to once a month, but the progressive amongst us should be pushing this idea more strongly.
Most other countries we like to compare ourselves to have had strict emissions standards an EV subsidies for a decade or more: https://en.wikipedia.org/wiki/Government_incentives_for_plug-in_electric_vehicles
Even the US has had federal subsidies that were introduced by Obama, and are far more generous than what is being proposed for NZ. They’ve worked so well there that the Tesla Model 3 outsells the Toyota Corolla.
What we should be asking is why are the measures we’re taking in NZ so timid and so late.
The “Federal Tax Credit” for EVs in the US was actually signed off by George W Bush – prior to Obama becoming President in 2009.
It gives each manufacturers customers up to $7,500 US “credit” on their Federal Taxes, for the first 200,000 EVs (or Plugin Hybrid EVs), sold and then phases out after that per manufacturer.
It has however taken until recently (the last 12 months) before the 200,000th EV was sold in the US by *any* Manufacturer,
Tesla achieved that goal in July 2018, GM 3 months later in October 2018.
Tesla has sold at least another 100,000 or more EVs in the US since July 2018.
Nissan is supposedly going to reach that 200,000th EV milestone later in 2019.
No other vehicle manufacturer selling to the US market has come close to selling 200,000 EVs in the US.
I believe that their current scheme was signed off by Obama https://www.energy.gov/articles/president-obama-announces-24-billion-funding-support-next-generation-electric-vehicles (American Recovery and Reinvestment Act of 2009). But reading further I see you are exactly right. There was an earlier scheme introduced by Bush that was expanded and replaced by Obama in his act.
That pretty much demonstrates the frustration of NZ local politics and media. Here things like this are far too politicised. Overseas, not nearly so much.
The previous government “supports greening the country’s vehicle fleet” https://www.national.org.nz/vehicle_tax_will_penalise_kiwi_motorists but in practice wasted the decade doing nothing. Now we have this limp, late offering from the current government. Which will probably be watered down more before it goes through, and/or rolled back by the next government. Mediocre all round.
BTW consultation surveyis at this URL
https://transport.cwp.govt.nz/multi-modal/climatechange/electric-vehicles/clean-cars/
One way to lose the next election – let the Greens loose.
Farmers, rural contractors, tradies, anyone with a legit need for a ute or 4 x 4 will be ousting Greens and Labour, and prob NZF as well.
Seems like ill thought out policy by a central city living bunch of politicos.
Welcome back National – I don’t want them back in but with the Auckland fuel tax, this tax on rural and tradies vehicles is just so dumb.
Only if they voted for one of the Coalition parties in the first place, if they voted for National at the last election then they can rage into the polling booth as much as they want, it wont make any difference.
I know quite a few tradies on Waiheke who have bought (or are trying to buy but can’t get one because stocks are low) a Nissan eNV200. It seems to suit them to save money on running it. I doubt they would object to a government policy which further supported the availability and reduced cost of the vehicles they want.
ThIs policy will make the running an EV a whole lot more expensive for them, sure they could save 2.5K on a 2nd hand EV, but RUC could tip them to just running a Petrol Version if its a pure financial decision…
Two separate policies. This policy would make it cheaper. But the reintroduction of RUCs (a separate policy, which could be extended) would make it more expensive.
The RUC exemption is dead, if you look at the RIS for this policy, its clear one replaces the other…
https://www.transport.govt.nz/assets/Import/Uploads/About/Documents/00c81821e5/LEV-Regulatory-Impact-Statement.pdf
its clear that officials want it gone, and the politicians have agreed with them
-Continue the road user charges exemption beyond 2021
“A continuation of the road user charges exemption beyond 31 December 2021 was discarded. This is because road user charges form a significant part of the transport revenues that are used to pay for the roading network and other transport infrastructure and services. These costs arise because of motor vehicle use, irrespective of whether the vehicle is powered by fossil fuels or alternative fuels.”
Scotsman
So only the townies should pay for climate change? You seem to forget that we are all paying for the leaky buildings that tradies erected at the early part of this century.
you can’t blame the trade for building to the codes which were set by the building authorities.
If the trades built to those codes [that they lobbied long and hard to have watered down as much as they were], we’d have half the problems we now face.
“Trades” or other industry organisations seeking to offload responsibility for their collective and individual actions is why schemes like these are needed in the first place.
But they need to be enforced – something the trades always reject from the get go, as they say its better that they be allowed to “self-regulate”.
For EV to work, there are a few things government also need to do:
– Converting more AT public parking with high speed charger
– Resource consent amendment for new commercial property to provide high speed charger (Shopping malls, Wilson, Patrol station)
– Amendment to Body corp rules to allow residences to request installation of charger on apartment/shared car parks on existing buildings.
– Amendment to allow tenant to to request installation of high speed charger on existing rental properties
– New build requires future proof to support installation of fast chargers.
Another concern is people will hold off and wait to buy green cars until the subsidies passes.
This will in short term suppress EV demand. The subsidies should be retrospective.
That might become a problem at some point. But for anyone looking to buy a car here and now, 2021 is so far off that it might as well be never.
Better to subsidise electric bikes than electric cars. They are still cars and the main issue with cars is simple geometry. They take up too much space.
And subsidise electric buses and other PT. I can’t think of any reason why one couldn’t hit the gas-guzzlers harder still and fund the alternative we want and need. Carrot and stick. Electric cars are maybe neutral (no carrot or stick) in that scenario. And reallocate the existing road space to make it affordable, rather than duplicating the existing infrastructure to operate PT.
Who’s “we”?
It seems in line with the OP’s thoughts and goosoid’s suggestion that I was commenting on, and what I understand to be the views of several of the people who regularly post here. Obviously some people will not want it right now, but I’d suggest they will need it sooner rather than later, given diminishing fossil fuel resources, lack of physical space for more cars, poor air quality, the untenability of an economic system based on continual growth in a finite world, and climate change impacts. Better to sort out an alternative whilst the money and fossil fuels are still flowing. You are free to disagree with me.
I think it’s really time for NZ to look at an equivalent of the UK’s bike to work scheme, even if it’s just for e-bikes. The scheme allows people to purchase a qualifying bike with a salary sacrifice – effectively they pay for it with their before-tax earnings, so it’s tax exempt and paid for in installments.
The key to really reducing emissions is to replace as many short journeys as possible with something other than a car, even if that car is a full EV. The benefits are to user health and overall congestion, as well as emissions.
Of course, the infrastructure needs to support such a change in usage. It’s not just the cost of ebikes that is holding back their fairly rapid adoption, but the willingness to ride them on our car- and ute-packed streets.
While the idea is coming from the right place.
The proposed implementation is deeply flawed for many reasons.
Some of which are:
1. There is no transition period so there will be a glut of polluting vehicles (new and second hand) imported prior to the new scheme commencing. In effect delaying the schemes introduction by several years as the glut works through. There needs to be thought as to how to minimise this.
An obvious one is bring it in sooner i.e. from start of the 2020 year not 2022.
As we don’t make cars here, we don’t need time to adjust our “vehicle assembly lines” or redesign the vehicles. The importers will just select a different mix of vehicles.
2. The top end tax of $3000 seems artifically low, needs to be a lot higher, and increase proportionally as someone who imports a top end Range Rover and a Canyonero [or equivalent] pay the same despite the vastly higher emissions of the Canyonero.
3. The maximum rebate similarly seems too low, considering a zero emission pure EV will as a minimum reduce the CO2 emissions profile of the NZ fleet by 105 g/km.
4. Clean car scheme (the related scheme on new and second hand imported vehicles) to improve the overall fleet emissions profiles of new to NZ vehicles.
Does nothing to tidy up the existing (and vaslty larger) vehicle fleet. These are given a free pass to pollute more and more forever until the day they are scrapped.
5. Does not take into account the relative safety profile of the vehicles when fee or rebates are calculated.
No point giving rebates to “efficient” cars that are relatively unsafe death traps compared to safer vehicles.
We should not accept trading off safety for the environment or vice versa.
Both should be improved, not one at the expense of the other.
+1
I agreed with most of your points.
4. Very old cars (like 20 years+) should require emission test at WOF.
6. Also the Emission should include noise. We don’t want noisy motorcycles or noisy race cars to ruin our street.
Noisy cars fail WOFs frequently.
Emissions tests at WOF time will do two things:
1) Piss off the classic car enthusiast community who might have a weekend drive car that gets used very rarely which is unlikely to comply.
2) Put a whole bunch of older, less affluent people off the road as their cars are older to begin with.
You’re more likely to drum up concerted opposition from the first group and ruin lives with the second group. It’s seriously not worth it.
We are probably the only country in the entire developed world without emission testing.
Other countries seem to be fine with it.
Emissions testing works in places like California and UK for older vehicles. There are different standards that must be met depending on the age of the vehicle.
There is no good reason for us not to have WOF emission testing. I’ve got a classic car which retains its catalytic converter so it would probably pass a sensible emissions test. Most people remove them for the extra performance.
There isn’t really a large proportion of the fleet left from the 90s and 80s. Early 2000s cars are only a few thousand now and they almost all have EFI and cats. It’s pretty hard for those sorts of engines to get out of tune like a carburetted older car did.
Thank you Matt, and for many of the contributors observations.
I wonder though if we are still looking at continuing with more of the same only with EV propulsion. Some have mentioned Sharing and bikes etc but we really need the system to reflect the reductions we need to make to attain Carbon Zero. In our 60 years of marriage, We have only once owned a vehicle younger than 10yo and have driven all them for over 10 years. So as I see it most of the vehicles that we are registering now will still be on roads in 10years and new ones for 20 years.
We have a problem with the emissions trading scheme not doing it’s job in providing price signals to the market on the price of carbon to emable us to meet our commitments. I propose that we establish how much carbon we can emit between now and the zero carbon date. We should be able to calculate what the transport sector can emit and arrive at an overall cost will be over the remaining years. This would then become an annual calculation so that if we are not achieving reductions then the amount to be recovered is going to increase in the coming years.
Put a price on those tons and decide that transport can emit only their portion of that. Then charge for the carbon each vehicle will have emitted over it’s mileage since it’s last WOF at the WOF assessment time thus each owner will be aware of where they are at and the probable costs they will be up for if we are not reducing our overall emissions. Later the cars cold be tested for carbon emissions but initially the manufacturers figures could be used as the basis for calculations.
This would send a signal to the market.
http://www.greengrowthknowledge.org/sites/default/files/Zachariadis_Presentation.pdf
Some interesting pieces from this article:
“Can be designed to be revenue-neutral
– But current real-world applications (e.g. Netherlands,
France, Ireland) turned out to be costly for governments”
Excellent. Someone else is lucky enough to buy a new car and we end up paying a share of it! I guess we all pay disproportionately for roads at the moment so what is new?
Standards probably inferior to fuel/carbon taxes from
an economic perspective
– But are a realistic solution, “a trade-off between lower
political costs and higher economic costs”
And the final conclusion of this report is,
“But purpose of feebates is to provide long-term
price signal, not work miracles in 1-2 years.”
The feebate presented is a weak option; implementation is too far away; and there seems to be better options than encouraging the purchase of lower emission fossil fuel cars.European example
That study you cite is out of date, it was published in 2015 and used 2008 data to draw its conclusions. So much of what it talked about is obsolete.
This article is much better about the French system which pioneered the Bonus/Malus concept (what the feebate scheme is based on).
https://theicct.org/blog/staff/practical-lessons-vehicle-efficiency-policy-10-year-evolution-frances-co2-based-bonus
Basically France initially got ripped off by the car makers who worked out quickly how to game the system by reducing the CO2 fees they got charged by doing just enough to get into the next lower CO2 band, while overmilking the rebates side.
France changed the way the system works to more like how it is proposed to work here. And they made the steps up and down in the CO2 levels continuous not discrete steps to avoid the gaming/”resting on their laurels” by manufacturers who did just enough for a Mallowpuff and no more.
They also now adjust the CO2 levels and pivot point every year (as is proposed here) to keep the system balanced.
Basically, France built a “feebate” system a bit like the UKs VAT system with lots of exemptions and special cases and such and lost revenue by doing so as people [car makers] spent more time fiddling the system than anything else which is not what was expected.
We are by comparison doing what we did when we built our GST system. That is with almost no exemptions a easy to administer system.
So, it should avoid the pitfalls and retain the benefits. And in fact the cost/benefit over 1 to 2.8 according the discussion document.
But it is too little and too late. We needed this 5 years ago.
Good that you mention the French system, because it has achieved little, a 3% average annual drop in the emissions of new cars purchased over the period. This in NZ will not be enough to achieve anything. Judging on NZs past history total vehicle emissions certainly won’t decrease. So while there may be benefits they are likely to be minor.
Ice the size of Mexico has melted from the Antarctic in just the last three years. Faced with this statistic just addressing new cars entering the fleet is as you say, too little, too late.
I don’t share your enthusiasm that this system won’t be gamed. NZs history is littered with subsidies that didn’t work e.g. landlords have realised that there is an avenue to increase rents because the accommodation supplement will allow tenants to pay; SMP’s caused the proliferation of sheep we didn’t need; subsidising a car manufacturing industry cost the country dearly.
I believe that there were always better options other than a feebate and essentially politics has prevented that. However we can still do better than this.
I am amazed that NZers seemed to have embraced the reduction of plastic realising that it will destroy our oceans, but mainly have yet to acknowledge that they may have to make some sort of sacrifice if we are to preserve everything else. That’s probably why we have the fourth worst emissions per capita in the world.
3% a year, year on year is quite a drop over 10 years. [30%+].
However, even if we could reduce our total light fleet emissions to zero. Thats still only 17% of the total NZ CO2/CO2e emissions.
The Elephants in the room is of course the dairy cow, the sheep and agricultural practices. Particularly around controlling Methane.
Methane because it is a powerful greenhouse gas, something like 50+ times the impact of CO2. Yes it only hangs around in the air for about 20 years before turning into CO2, but in that time it can do enough damage to equate centuries of CO2.
But thats a problem for politicians/Governments to directly address. The underlying issue is that the farming sectors current business models are based on externalising as many of their costs as possible, particularly environmental costs. So that wider society pays directly or indirectly to deal with these issues.
Unless a effort is made to reign in such practises in a serious matter no end of vehicle emission schemes will generate enough reductions.
I’m an optimist. I guess there’s a chance that lab grown meat and diary, marketed as “clean meat” and with health and environmental benefits, could become mainstream before EVs.
The pessimists will say that progress will be slow as lab grown food is going to run into the same deep pocketed entrenched interests as EVs have with big oil and fossil car companies. Hopefully we don’t have to wait 120 years: https://electrek.co/2019/07/04/1898-riker-electric-auction/.
NZ is making seemingly no preparations for this kind of future. Fonterra seems to get it, at least in some small way: https://www.stuff.co.nz/business/111546089/fonterra-is-investing-in-labgrown-meat-but-would-you-eat-it. But I’m pretty sure no NZ governments get it. We could be taking steps now to diversify, in similar way to many middle eastern countries are preparing for when the oil stops flowing. Most obviously, by removing obstacles to GE research here.
In fact 30% is not a great drop compared to what we might achieve in other ways. Here’s some numbers:
Currently emissions for new vehicles are 161g/km. If this is reduced by 30% we arrive at 112g/km or we have saved 49g/km
However if we put each car driver on a train, tram or electric bus we save the full 161g/kg.
So the feebate scheme is saving 49/161 = 30% of what is saved by train travel.
NZ imports about 330k vehicles per year, or say 110k to Auckland. A similar saving will be achieved by having 30% of this number using trains etc., or about 33k people. Say the average person makes 15 trips per week then there is a PT ridership increase of 33,000 x 15 x 52 = about 25.7 million trips per year.
Heidi’s post of a couple of weeks ago suggested that to achieve emission reduction targets greater numbers than this need to take up public transport over the next ten years. There seems a compelling case to use a feebate to move people to public transport and not fossil fueled cars.
The elephant in the room that is not being discussed is scrappage. It is almost negligent to be continuing to encourage the uptake of fossil fueled vehicles in 2025 or 2028 that might need to be scrapped as early as perhaps 2040 when NZ discovers we can’t afford the carbon emissions. This scheme could cost tax payers dearly if the government embarks on a buy back as they have with guns.
I am struggling to find much to like about the proposed feebate. There seems to be other much more sensible alternatives.
Just because someone ditches the car and uses electric buses/trains etc doesn’t make them of itself, less polluting.
Because if they order everything online and have it delivered they are not reducing pollution, just displacing it to other vehicles.
If we want to seriously tackle the problem we need to tackle Methane first and fast. As thats tens of times worse than all the CO2 we emit or will ever emit. Both NZ Wide and Planet wide.
A large part of the acceleration in temperature rise is caused by unchecked growth in these “invisible” gases. And its not just farting and burping animals that are the issue. Natural gas leaks are a large part of the problem, as are fertiliser plants.
Just that til now they’ve been able to hush up their emissions as no one was looking for them. Now they have gone looking they see a hundred times the estimated emissions, from a gas that is the thick end of a hundred time more a greenhouse gas than the poster boy of CO2.
So we have 8,500 to 10,000 times as much “CO2” from Methane related emissions.
ProdCom is aware of the effect of emissions lock in of the current fleet which is why the existing fleet has to be fully electric before 2030, to ensure we have almost no fossil fuelled emissions.
Anyone who buys a new [or second hand Jap import] vehicle now is likely NOT planning on keeping it until it reaches the fleet average age of 19 years I’d bet. Subsequent owners of that vehicle will likely find its too expensive for many reasons to buy/operate even 15 year old Fossil fuelled cars.
But as Norway is finding, once the tipping point is reached for electric vehicles, the changeover will happen quickly and at ever gathering pace. But it won’t be at the cost of the Government. Individual tax payers will find that the sunk cost of their fossil fuelled car will be too much bother with and they will themselves scrap their old cars for newer electric cars.
We have time to get there, but not a generation.
By 2035 if not sooner much of the existing fleet will be electric.
I have more faith that the fleet emissions will go down.
I have zero faith that farmers will – because their business models are entrenched and make it harder for them to change than it is for us collectively to replace our entire vehicle fleet (heavy and light) in the same timeframe.
Thank you Greg N. That link is great.
What are the options for steering the market?
Should we be paying for the emissions our vehicle has rceated in the past WOF period at WOF time?
Is that a possible scenario?
How much of NZer can afford a new electric car? If NZer are so rich, there won’t be so many used car import to NZ. NZ is the biggest used market of Japan. NZer can only afford Japan’s used vehicle. The Government or those having authority to define rule of the Game just living in their dreams or there’s hidden benefit that they can take we don’t know.
Electric car isn’t “mature” yet, the Battery alone will drive you down not only of the short running mile, it’s life, supporting station as well as how to dispose it after dead.
Thank you Greg N. That’s a very interesting link to the French experience. It illustrates how hard it is to change the market and to be fair at the same time.
WHat can be learned from their experience?
What are the German’s doing?
(It seems to me that the French 10 year change is much slower than we what we need for NZ.)
I wonder if they are meeting their goals for change?
Could the manufacturer’s have done better?
How can we manage our reduction to meet the targets we have set?
What is that target? (we need to know).
It doens’t matter if the target is not met but we do need to know if we can reach a target and to set a new one at after a set review period. In the same way we are doing over our housing target.
French system allows up to 1/3rd of the vehicles cost to be rebated.
[we’re looking at a lot less than that here, more like 10-15% – barely removing the GST component].
European wide they are introducing a fleet wide emissions system from next year. With very high penalties for non-compliance by importers/manufacturers as such the French scheme will become less relevant to EU wide emissions reductions.
The target is 105 grams of CO2 per km as a fleet wide average.
This is a target we don’t intend to achieve here for newly imported cars until 2025. So we’re at least 5 years behind Europe. We should be a lot closer than that it we intend to meet our commitments.
105 is so draconian (according tot the manufacturers anyway) that some manufacturers are pooling their vehicle fleets together to avoid the fines.
Which allegedly could amount to Billions of Euro per annum for some manufacturers like Fiat Chrysler American (FCA). Who have teamed up with Tesla and will pay Tesla hundreds of millions of dollars starting next year for the privilege of continuing to make and sell polluting cart.
So Europe will be getting itself CO2 neutral by 2050 or sooner without a doubt.
Our targets will decrease over time, but we actually need to target heavy trucks and buses as well. Something this scheme ignores.
The only thing those types of vehicles get now is a RUC exemption. Which can be a lot of money, but due to the lack of electric trucks and buses you can buy,. no one is bothering much. Rubbish trucks seem to be the only electric heavy vehicles currently much in use – in part as there are very real time and operational savings to be made in those cases, even if the trucks cost a lot more money.
However, there once there are good alternatives to diesel trucks and buses, the fleet switch-over will happen quickly as the economics of electric trucks and buses are so compelling operationally that once one or two competitors switch over, the others will have to follow suit or lose business to them, or even go out of business.
This is a powerful lever that is not yet pulled. For private cars (the so called light fleet), there is not that level of incentive to do anything. So most will keep the old dunger on the road as long as possible.
Greg
I am not concerned if someone retains an old dunger for a period of time as long as they drive it a lot less. A person sitting on a bus or train for a large chunk of their week is much more helpful than a person driving everywhere in a Corolla and still producing over 100g Co2/km.
If there is to be a feebate there is no logical reason to include fossil fuel vehicles on the rebate side because it is creating a huge liability in years to come – how do we get rid of them?
The old dunger cars will soon not be used, dying a natural death due to difficulty in getting WOF’s
Actually that “pious” person using the train or bus to go to/from work 5 days a week and never drives – but who gets everything delivered to work of home via online purchases [locally and/or from overseas] is in fact just as bad, if not a worse polluter compared to the Toyota Corolla driver.
Its horses for courses here, and buses and train users aren’t “all good” and everything/one else all bad.
There is valid reason to subsidise (via feebates) lower than the *current* fleet average CO2 emission vehicles that are also safer than the average fleet is. Because they are working to lower the fleetwide emissions of the NZ vehicles fleet.
If we also develop alternatives people won’t drive as much. Which is a big help. But its one part of the answer. Not the whole answer.
As for getting the problem dealt with. The focus should be on getting the really big polluters off the road the only way to do that is have emissions testing. But apparently the Government officials recommended against such a regime as disclosed in the cabinet papers also released for this proposal.
While these old dungers will eventually fail their warrants of fitness that won’t stop them being driven or used just because they have no warrant or registration. Emission testing similarly won’t take them out of the fleet – you’d need a compulsory scrappage scheme to ensure they are removed.
That may be why the officials didn’t support emission testing. Due to lack of ability (or desire) to actually get them off the road.
It is known from overseas studies that something like 85% of the bad emissions come from 15% or so of the vehicles. If we target those vehicles and actively remove them from the fleet – even with cash incentives its good value for money.
But you need a multi-pronged approach. Feebates are part of the approach, and not the only part.
Of course none of this deal to the trucks or the buses that travel around spewing out a whole lot of the CO2 and other pollutants, despite being only 5% or less of the national fleet.
If you really wanted a quick win you’d target those badly maintained heavy fleet vehicles ahead of the light fleet, or as well as the light fleet.
I am still not convinced that a feebate is a mix of any package. I have demonstrated that the fee could be better invested elsewhere.
The Corolla of today becomes the dunger of 2035, an anomaly among evs and what will probably require a scrappage fee to eliminate. It just seems bizarre that someone will pay $3000 to bring it into the fleet and then pay a scrappage fee to take it from the fleet.
Otago University research indicates that we will need substantially less cars so why put them into the fleet to then take them out?
The future is not only evs because so many things conspire against them: we don’t have enough electricity by probably a factor of two; we don’t have the lines transmission; and if we wind down sheep, cattle and dairy we won’t have the overseas funds to import them.
The sensible move seems to move straight to public transport wherever possible and that is why you see the countries most focused on emissions, the EU, with such a strong focus on public transport.
Almost any investment private or public can be generally shown that it should be spent elsewhere for a a better outcome than whatever its actually spent on.
So claiming you have “shown” feebates are a waste of money is simply another way of saying all investments/schemes particularly government ones are are pretty much wasted. Be it welfare payments, hospitals, schools, education, roads. Public housing or whatever. You name, it, we waste money on it. Hand over fist.
Any car imported today no matter what it cost originally becomes a dunger in 2035. It has reached its use by date by then. Its 16+ years old.
Its a dunger mostly because the investment in keeping it going is not worth the benefits obtained from doing so. So the well informed owner elects to sell it to the scrap yard for a small fee, or nothing if its really bad, and lets the scrapper take care of recycling it.
The less well informed owner keeps it going by spending more and more money on it without considering the alternatives.
Remember this is private citizens buying/scrapping these. Not the government. Yes it takes foreign reserves to buy them, but not to scrap them. And any loss is therefore borne by anyone stupid enough to buy a car of any type, in the first place.
Which currently is most of us.
The $3000 applies only to the likes of $100,000 dollar Toyota double cab utes and Range Rovers and such. Most of the low end cars imported here whether Jap imports or new are not those kinds of cars nor cost that much money.
Your normal Corolla anything pays nothing, or a small $800 or so fee under feebates and may in some case, if its efficient enough, get a small rebate, of maybe $800. Hardly big money either way.
Eventually we will have less personally owned cars. But there will be a need for a fleet of cars, buses, taxis and such that maybe we use “on demand” rather than own a car outright. We’re not there yet.
And the bus and trucks won’t go away either.
Right now people find it simpler and easier and less financially “bad” to own their own car. In 10 or 15 years time I’m sure it will be quite different. Feebates or no.
Elon Musk of Tesla fame has stated that cars will (naturally) become in that sort of time frame, the same as Horses are now – that is a specialised “transport” option used for leisure/pleasure by some people but not many. And definitely not as a sole means to get around. Horses never went away when cars came along, nor will cars go away completely when something else comes along.
Public transport has a place – but for large parts of NZ with widely dispersed populations unless that public transport is fully automated, on demand and ubiquitous it will never work for them.
They will still need alternatives. That alternative may involve a shared ownership car.
Be very sure, the need to own your *own* car will go away and quicker than you think. Once there are good alternatives and the cost of owning your own car doesn’t stack up anymore.
But we put chose to put them in the fleet now as we don’t have enough alternatives to them now. Thats not a problem the feebate system seeks to fix. Thats a different problem for a different thread.
We can wind down sheep, cattle, dairy, bare log exports and such and still live in a modern economy. Because we can and will switch focus on the high value added components those enable – and don’t simply aim to be the cheapest commodity supplier or meat, dairy and wood chips or logs. Because we can never win that race to the bottom. someone will always be cheaper.
We got away with doing that for 120 years, but that was at the expense of the environment. We certainly can try and do it for another 120 years, but we (NZ, or the rest of the planet) won’t make it if we do try.
As far as “not enough electricity”.
We are not going to be short of electricity for electric cars.
We have way more than enough electricity in this country RIGHT NOW. We simply chose however to waste 15% of it on a aluminium smelter in Bluff – in return for it providing a token few thousand jobs.
ProdCom did the sums last year on all this, the entire NZ fleet could go electric and we’d not be short of electricity with existing power generation, along with the existing consented (but not yet built, due to insufficient demand for the power) generation.
If the Bluff smelter is shutdown (as it will need to be by about 2030 due to its increasing CO2 and related emissions), then that now spare electricity can easily cover all the likely electric fleet demand by itself for the foreseeable future beyond 2050.
The other thing is that people won’t simply do as is supposed and plug their cars in when they get home each day and cimmediately charge the cars while they cook dinners and such.
The will be incentivised by off peak charging plans to charge them overnight when there is power to burn. Later on when we have solar and wind power to burn the cars will know when the power demand is lowest, and charge them, ensuring you have enough power for your planned (and unplanned) trips tomorrow.
Secondly, the future EVs will be a two-way energy device – taking in energy off peak, but equally able to give it out at peak as needed to “shave the peaks” during the days and evenings. Why will people do that you ask? Well because they will be incentivised to do so not because it right for NZ Inc, but because its right for them economically.
What is missing here right now is the incentive for people to buy into any of this. But we can and do use technology in very nuanced ways, if given the right incentives/signals to encouragement for us to do so. And the governments of the day aren’t too scared from doing actually doing so.
If EVs were looked on as two-way mobile storage units, then the economic “sink” argument become turned on its head. Suddenly that EV can make you a ton of money smoothing your, your neighbours, your towns peak power demands or time shifting your
power usage.
That alone would save the country and every one in it a lot of money. Over 10 or 15 years.
We don’t do that now as the electricity market is too fragmented to efficiently support this future. But it will become like this sooner than later. And when it does, a lot of the we have done things today, or the near future will change. For good. And will never go back to the old way.
But we used to have a lot of those sorts powerful “vote with your wlalet” decisions taken away from us by governments in the past. On the basis that we could never manage to make those sorts of decisions for ourselves.
The thought of letting every citizen have their say 24×7 or each carrying and using their own radio transmitter/receiver that could make and watch sound and images from anyone else was truly frightening to most governments [for some overseas ones, it still is]. Yet here we are with social media platforms galore and a lot of us carry around mobile phones.
“Be very sure, the need to own your *own* car will go away and quicker than you think. Once there are good alternatives and the cost of owning your own car doesn’t stack up anymore. But we put chose to put them in the fleet now as we don’t have enough alternatives to them now. Thats not a problem the feebate system seeks to fix. Thats a different problem for a different thread.”
It’s closely interrelated, I believe. Our policies influence the speed at which people give up their private cars. The number of cars being imported and the change in fleet numbers overall are good measures of how effective our policies are at changing the triggers for people to get rid of their cars. Right now, they indicate our policies are poor. If the feebate isn’t designed to directly reduce vehicle numbers, what additional policy is required?
Whether or not we can generate sufficient electricity to shift everything we are planning to shift to electric within the energy, industry and transport sectors is one question. Another is whether the world has the required minerals to support swapping all the ff vehicles to electric. The best analyses I’ve seen suggest we’re very far short of that.
Vehicle needs go down when the economy bombs. I’d prefer to control our transition, by actively reducing vehicle travel needs and vehicle ownership needs.
Feebate is not intended to of itself result in fewer cars being added to the fleet.
It can help steer people to choosing a less polluting model of vehicle than existing models. Thats about all it can do.
If everyone continues believes they have an unfettered right to *drive* themselves where and when they choose you will not reduce the vehicles in the fleet (or more importantly, the Vkt of whatever vehicles we have in our fleet).
To get the Vkt numbers down we need totally different policies. Pricing externalities like congestion, pollution, and other costs is always a useful start. That way rational choices can be made (like how Taxi drivers all switched to Hybrids – when the monetary savings to be had became apparent and other taxi drivers started to switch over).
As compared to the present irrational choices (like driving massive/heavy double cab utes and SUVs around in urban areas e.g. on school runs). These are at least irrational from a public policy point of view, even if at the same time appearing to be perfectly rational from a private car owner/drivers point of view. (well I believe its safer for *my* kids, me, my family etc even if not like that for anyone else).
While it is true that the next few billion vehicles on the planet cannot be made, look or work/be powered the same as the current billions of vehicles already on the planet. It doesn’t follow that we don’t have the mineral or resources or capabilities to make such a change.
Many of the so called analysis of electrification of the transport fleet assume that minerals like “rare earths” are in fact rare. The reality is they are not that rare. But they are not evenly distributed and they are often currently found in places that are keen to keep their monopoly on them (China), or have poor environmental or human rights records.
Everything you say about not enough resources to make enough cars was true once about oil and fossil fuels in general. And we wolved that problem for sure.
We just need to ensure that we don’t carry on the “business as usual” approach and end up making a bigger mess than the one we’re trying to solve, in the process of solving the current mess.
Some of that can be solved by NZ Government policy, but an awful lot cannot.
And some people won’t believe there is anything to worry about until they see the massive tsunami about to crash on the beach in front of them. You can have all the policy you like – but that won’t help those sorts of people from themselves.
“ProdCom did the sums last year on all this, the entire NZ fleet could go electric and we’d not be short of electricity with existing power generation, along with the existing consented (but not yet built, due to insufficient demand for the power) generation.
If the Bluff smelter is shutdown (as it will need to be by about 2030 due to its increasing CO2 and related emissions), then that now spare electricity can easily cover all the likely electric fleet demand by itself for the foreseeable future beyond 2050.”
Yes the ProdCom did and they do not agree with you. Chapter 13 “Electrification of transport and process heat will play a big role in New Zealand’s path to an economy with very low emissions (see Chapters 3, 12 and 14). This implies a large
expansion in electricity generation in the years to 2050, by as much as 65%.”
I agree with you that the govt can come to any restructuring decision they like and it doesn’t have to be the most sensible – and I say its not.
I also gain support from the C40 Cities recommendations, “The Bus Rapid Transit and Bus Services Programme is shown to be the most effective programme in emissions reduction terms, delivering just over a third of all potential savings from in-city action. Actions within this programme include improving public transport infrastructure, services to attract users, as well
as fuel switching to low carbon energy sources. The emissions reduction is particularly affected by driving a modal shift from private vehicle use to more carbon efficient public transport.
Travel Demand Management is the next most successful in reducing emissions across C40 cities, with emissions reductions of 17%. This programme involves a range of initiatives such as car sharing, congestion charging zones, parking restrictions and cycle hire programmes which together can reduce energy
consumption for transport.”
I say it makes more sense to tax every fossil fuel car and apply most of that to PT improvement. I note that Genesis submitted that we would have to stop fossil fuel vehicle imports by 2050. That is on a best case scenario. Start the process of winding down imports now by means of a small fee – a price signal – that we are moving away from fossil fuel.
We have enough power to manage an entire transport fleet that is electrified.
The Renewable power generators like Meridian. Mighty River Power all say this. ProdCom also said that too – but possibly it did so only in the footnotes/white papers that the main report had extensive links to.
However, electrification of all industry processes [on top of transport] away from use of fossil fuels. Thats another topic for another day. Suggest you submit a guest post if you want to do that.
Yes, doing that places a heavy demand on electricity resources, because the last few/2% or 3% of the process energy will suck up enormous amounts of electricity energy/capacity to replace the fossil fuels.
It may be wiser to instead aim for 95-98% rather than 100%, and then use natural sequestration (plant more native trees in the right place, and let them grow for hundreds of years etc) to do the final few % – but deal with the CO2 emissions on a sustained/sustainable basis.
But for transport, we have enough already generation consented or in existence to not need to build more to electrify the fleet. Of course that won’t be required tomorrow.
Importing Fossil fuelled vehicles has to be basically ended by 2030, as the emissions lock in of the vehicles already here will require us to do that to ensure most are gone by 2050. Genesis is playing wishful thinking if it thinks we can ban all fossil fuelled vehicles only in 2050 and be carbon neutral in 2050 as well.
Feebates will swing the needle, especially if they keep adjusting the “pivot point” down each year in continuous steps. France didn’t and paid the price. They now learnt that lessen and are now doing so. So they have wasted most of the last 10 years in an ineffective system. We are not planning on doing the same.
For the urban transport, what you say may be true. But that is a solution not suitable currently for all of the NZ resident population. for instance only 1/3rd of the population live in Auckland, and a lot less than that have access to suitable PT options. Let alone good ones.
1/4 of the NZ population lives in the South Island, not all of them in Christchurch. So there are few PT options for many of those folks. So while PT can play a big part in large cities. Other/different solutions are needed there.
Basically your one size fits all approach won’t work because…
… even if you taxed the hell out of every fossil fuelled vehicle in NZ with the current disjointed planning and delivery processes, around transport/land use/energy policy there is absolutely no chance we’d actually get the PT or other options you think we should have by 2050.
So if you want to start fixing things, start by fixing the broken processes that led to the situation in your neighbourhood, town etc.
But we need to get feebates underway too to signal the masses who buy and use private vehicles that the “steady as she goes” future is not a long term option any more.
“Secondly, the future EVs will be a two-way energy device”.
As a rural resident with no access to PT I am very much in favour of EVs but this is not plausible in my view, Greg. In general battery life is a function of number of cycles and their depth. Secondarily it is a function of the currents they are subjected to. Selling EV battery cycles to someone else decreases the cycles available to the EV owner.
The concept is unlikely to be widely taken up because EV owners will realise that it makes no financial sense and because the times of peak demand for selling power will be largely unworkable:
Firstly, the hypothesis that cycles on a battery optimised for a vehicle (ie. high energy density) is less costly than cycling a stationary battery is highly dubious…and a power company is only going to pay out for battery capacity if it is cheaper than buying and using their own.
Secondly, the peak demand times, ie. those times when EV batteries would be called upon to supply power to the grid are also those times when (for a typical commuter application) the EV owner is most likely to want a full battery (about to set off for work) or will have a discharged battery (having returned from work) or be on the road and not connected to the grid.
Thirdly, the capital cost and round trip efficiency of the process has to include the requisite inverter.
If time shifting of electrical energy using batteries is going to take place it will be with made-for-purpose stationary batteries (ones that haven’t buggered off up the road when you need them) and large scale rectifiers and inverters. They will be sited not solely to provide additional power but also to support transmission lines that would otherwise need upgrading.
A lot of what you say applies to current EVs.
But I never said to use current generation EVs for that.
Just don’t judge the future by your [or anyone elses] present.
Future EVs – not yet designed or available to buy, that will be here in the next 10 years. Will allow for these capabilities. Maybe not “as delivered from the factory” but certainly with added components like an inverter and controlling electronics.
Which are things any battery storage device needs today. And yes the loss of energy from a round trip into and back out of the battery has to be allowed for when doing the sums on it.
While your cited use cases apply to individual EVs, taken over a large area/more EVs, the picture is more manageable than you think.
For each owner they will set the minimum acceptable capacity they need for different times of the day. The system will manage within that limit per-household/EV. If the owner needs 50% of the battery to make the daily commute to work and back, they can reserve that capacity so its not able to be used for other purposes.
And of course if the EV is not at home and there is a power cut, well you get your power cut off. Thats not a new problem, nor inherent to EVs. But your EV could also be plugged in at work, or where-ever it is parked – doing all those things.
Remember most cars today spend some 95% of their lives parked. If they can return money to their owners while they are parked and perform a useful function for society its all in all much better outcomes.
If you have two EVs in your household and one is “Away” at work or where-ever, the other one can step up and run the house.
Assuming your EV has to be plugged in at your house to “time shift” your usage is the present way things work. But in the future you may be able to “time shift” energy from anywhere.
Not just when plugged in at home.
However its not just stationary storage that is relevant. being able to have 240 volts of power in “the field” (think or a tradie, or farmer or even just someone on a day trip to the country). That too is a valid use case. Not possible today.
Current battery tech in effect is designed for one use or the other (stationary or mobile) . Doesn’t mean it will always be that way. Its a artefact of the existing technology. Nothing else.
And of course whether you actually use the two-way capability in your EV if it has it, depends on all sorts of things, including whether the power company wants to pay you fairly for the grid support you provide, which obviously must include the wear and tear on your EV, inverters and grid within your house as well as efficiency and such
You’ll do the maths, you’ll make the call. If it doesn’t stack up, you don’t go there.
Your power company will similarly decide.
But I think they’d find it cheaper to manage thousands of connected EVs and storage devices that customers own – but who these customer choose to let them manage, as compared to building, owning and operating large stationary storage battery systems.
Basing your arguments against this is all like trying to imagine all the possibilities of everyone owning a personal smartphone, that eveyrone has, that is connected all the time. But doing so from the point in time when only a few people owned brick sized mobile phones with short 1 hour lifetimes that can only make or receive voice calls and cost a fortune to own and operate. i.e. exactly as it was in the early 1990s. And barely 15 years later, the world had changed. Completely.
We are in 1990 as far that situation goes with EVs. And our transport “iPhone moment” will arrive long before 15 years.
I am not sure what the fuss is about, global warming and its relate climate change doesn’t care a damn about what humans think or what disruption to human lifestyles it causes, the message is – adapt or die.
The reality is, owning a vehicle whether as an individual or business, is a privilege not a right.
What the government is proposing needs to happen now. The quicker we face that life as we know it, is going to change and we need to start adapting to warming planet.
“The government also need to look at how they can get more buses replaced with e-buses”. Spending 16 million dollars when they were first elected to buy out the contract of the contractor dismantling Wellington’s trolley bus network would have been a good start. Then buying proper rectifiers to allow the buses to operate at peak performance. To replace that network would be hundreds of millions of dollars. It was an act of vandalism encouraged by the previous government to enable bus contracts to be negotiated for the PTOM. Yes battery buses are coming, but in the meantime Wellington has to put up with smelly noisy buses from Auckland.
I understand the difficulties of using fully electric busses that might not have enough range to run a full day, but what is the reason that bus companies aren’t using hybrids? Regenerative braking at each bus stop should give a massive efficiency improvement.
Londons Hybrid Double Decker buses didn’t pan out the way they should have i nthis aspect.
So I think the overall complexity of having two motive sources plus associated mechanical connections makes it too expensive to buy and maintain.
Cheaper for bus companies to chug down the diesel on their cheap shit diesel buses than bother to do the right thing. And give that the bus companies are almost invariably penny pinching, profit driven businesses and nothing else, they’re not going to change their ways without someone else paying for them to do so.
That’s funny, I would’ve expected uber drivers to be just as penny-pinching, but hybrid works out to be the best option for them. I’ll look into the results from London, the answer might be hiding in there somewhere.
Hybrid technology ala the Toyota Prius is a safe and mature technology decision now. So of course Uber (and Taxi) drivers follow it en masse – the savings are there, quantified and the cost of fixing a Prius is not much more than a regular petrol car. So why not use them.
It wasn’t always that way, earlier Prius (like 18+ years ago) had problems too. But Toyota worked through the problems.
I think the buses suffer from being a new technology.
Hybrid sometimes means you get the best of two worlds.
It can also mean you end with the worst of both too in some cases…
Hybrids are an egregious violation of the KISS principle; a principle that I increasingly value in the field of engineering.
Well my Honda Hybrid engine is about as simple a design as you get. Its has a large “motor/generator” bolted to one end of the engines crankshaft.
It can act as the start to start the car engine (helps as it has stop/start technology to stop the engine at lights and other places), regenerate kinetic energy to electricity for the battery as the car slows, or assist the engine during load conditions.
And it can move the car in some circumstances by depowering the cylinders using valve lifting “variable cylinder management” technology already in the car.
So, all in all, for little added complexity it achieves quite a lot. But it is a stepping stone to full electrification. Not an end in itself.
So its the right kind of hybrid (and the car still works if the main hybrid battery is dead). The trade off is you can’t really run on electric motor alone. But the thing is efficient in the way it uses petrol. Even around town.
Interesting, it seems that hybrid buses have had a tough time in London. Maybe it’s more difficult to make hybrid technology work in buses than in passenger cars? Here are a few quotes from Wikipedia:
“in 2006 the vehicles were temporarily withdrawn from service when their diesel engines overheated”
“By 2016, 1,000 New Routemasters will be in use. However, the buses have suffered from problems with their battery systems with some operating solely as diesel vehicles, and in total 200 buses will have power units replaced under warranty.”
“emitting more pollution than their predecessors due to unreliable hybrid batteries”
It seems like there were other design issues around the doors, and the political aspect of being called “Boris Buses” probably didn’t help either.
I think the issue is that they skimped on the battery/electric motor side due to its cost and space requirements.
Too much tech in a new fangled design. In time the issues could be sorted out.
I am sure.
The old Routemaster buses weren’t perfect either. I used to walk past them parked up strings of them every day in London in Summer on my way up Alwych – got used to seeing them all there in their overheating red, steaming glory, and seeing them having Radiators topped up with water and other ongoing maintenance issues – at what was the start of their working day.
Heaven knows how they got through the rest of the day.
If the government is willing to adjust add “a new fee of up to $3000 on the import of vehicles with the highest greenhouse gas emissions”, would it be fair to add a new fee on the import of vehicles that evidence shows have a higher rate of killing pedestrians?
Given that Safety and Environment are both goals of the GPS, but Safety is ranked higher.
The argument was that they are handled by the ACC levy on annual vehicle registrations being tiered based on the vehicles safety ratings.
And thus recovered on a “evidenced” basis during the vehicles life.
But then I read recently that NZTA are moving away from the tiered system of ACC levies for car registrations.
So what gives. Do ACC/NZTA want safer cars in NZ or not?
But the system for both should actually be based on the distance you drive the vehicle as well as how polluting and how dangerous it is assumed to be when first entering the fleet. Both of which are educated guesses and little else.
After all $3000 “estimate” for the top end environmental costs of the biggest gas guzzlers is likely, not the true environmental costs it will be incur in its life in NZ.
And how much would you charge the same vehicle for its dangerous-ness to other road users [not just pedestrians – all other road users]?
Based on actual exposure levels on a year to year basis.
After all a massive tractor or wheat harvester can be a dangerous thing for anyone else to come across. But if it seldom drives on the public roads its not a danger to most people.
So how much of a safety levy do you charge one of those?
And what about the Lime e-scooter, some would say they are one of the most dangerous devices for pedestrians using the footpath, yet they don’t even have to pay for it, other than a “council tax” for using the footpath when parked.
I’m all for levelling the playing field equally for environment and safety costs, but lets do a proper system suitable for both not some tack on to the back of some other system [like feebates] designed for a different purpose.
Allowing that is how we got in the mess we’re in now.
I think we deserve better outcomes than that.