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It is tempting to think about what could have been. In 2020, a time many people would prefer to forget, there was a significant push to set an end date for the sale of new petrol and diesel cars.
The UK had announced a ban from 2030. India – the world’s most populous country and which, like Australia and the UK, uses right-hand-side drive cars – had a target to do the same. In Norway, about 60% of new cars were already electric.
Australia was in a different place. Scott Morrison had launched a fact-free attack on Labor the previous year for proposing a non-binding 50% target for new cars being electric by 2030, claiming it would “end the weekend”. The Coalition disregarded advice that a scheme to cut car emissions could have a $14bn net benefit to the country by 2040 and later dropped a commitment to release an EV-specific strategy.
More than five years on, the country is counting the cost. The Albanese government has introduced a vehicle efficiency standard that requires a year-on-year cut in the average pollution released by new cars. It’s a step that has been recommended for nearly two decades, but the change it drives will be gradual.
There has been fanfare about the record number of Australians who went electric in March. Some perspective is needed here: EVs were still less than 15% of new cars sold, barely up from 13% in 2025. Even as fuel costs soar due to the Iran war, most cars being driven away from car lots have polluting internal combustion engines. And they could be on the road for the next 15 to 20 years.
A more interesting change has been the rise in secondhand EVs. Sales more than doubled last month, albeit from a tiny base, and the re-sale price improved significantly. A thriving secondhand market with prices that are affordable for more buyers and high enough to encourage owners to think they are getting value will be vital for EVs to become more widely available.
But Australia remains well behind other countries in embracing clean cars. Globally, about 25% of new sales last year were electric. The number of EV models available in Australia is expanding, but the average price gap between petrol and electric models – roughly 20% depending on car size – is still a deterrent.
The good news is that the gap is now closing reasonably rapidly. And the savings for those who drive an EV are potentially huge.
A simple way to get a picture of this is via a website created by Simon Holmes à Court, an energy analyst and the co-convener of Climate 200. Using data from the electricity retailer Amber, it compares the cost of running an average petrol/diesel car with an average EV.
It suggests over the past month that an EV could travel more than 40km on $1 of energy, while a fossil fuel car would have travelled less than 5km on $1 of fuel. Amber thinks Holmes à Court’s assumptions are too conservative, and that customers of its smart-charging platform could have driven nearly four times as far – about 160km – for $1.
Despite this sort of evidence, the political and media debate is doing what it so often does in Australia – struggling, and sometimes refusing, to imagine a future where the country is less reliant on fossil fuels. People obviously need a reliable flow of diesel and petrol. That won’t change anytime soon, and global supply is an important and necessary government focus.
But calls for oil exploration and expanded refining in Australia are kneejerk and transparently political. A case in point: the Queensland premier, David Crisafulli has claimed that his state has a “sea of oil” in the Taroom trough west of Brisbane, and that the federal government should be fast-tracking its development.
But the state resources department is more circumspect. And there is no project of waiting for approval from Canberra. If there is substantial oil – and it remains an if – it will probably be hugely expensive and take years to develop a field. There has been no evidence to back claims an expansion of local liquid fossil fuel production makes sense – scientifically or economically.
It would be nice if this no longer needed saying, but for the sake of clarity: given the scale of the climate crisis and Australia’s legislated commitment to act on it, logic says the focus should be on how the country can reduce fossil fuel use and switch to cleaner, cheaper and healthier alternatives as quickly and equitably as possible.
So what more could governments do?
First, they could make multinational mining companies pay their way. Mines are Australia’s biggest diesel users, and coalmines are the biggest user of diesel within the mining sector. Bizarrely, these mines receive a full 52-cents-a-litre rebate on the diesel they buy under a national fuel tax credit scheme.
It means coalmines get more than $1bn a year in taxpayer subsidies to make it cheaper for them to use fossil fuels while they produce more fossil fuels.
It is a disincentive for companies such as BHP and Rio Tinto to invest in cleaner trucks and other technology – a step that a separate government policy, the safeguard mechanism, is trying to encourage. It makes little sense.
Second, if you want to electrify the car fleet, don’t introduce new roadblocks that could slow the uptake of EVs. Calls for a road user charge on EV drivers persist despite the technology making up little more than 2% of the total car fleet. A new tax would be a strange way to encourage uptake.
Third, more could be done to accelerate a shift to electric trucks, which have been even slower to take off in Australia than cars. The Grattan Institute’s Alison Reeve says that could start with changing a requirement that trucks have to be narrower than in some other countries. Drop that and the available range of trucks could quickly widen.
Reeve also backs significant investment on charging infrastructure on key routes, starting with Melbourne-Sydney. Blitz the areas where there could be the greatest impact.
On passenger EVs, she proposes getting rid of parallel importation laws so that more secondhand clean cars could be imported. New Zealand allows it. Why not Australia?
A genuinely ambitious government could also just raise the cost of buying a fossil fuel car. China kickstarted an EV revolution by issuing “green” licence plates for those in major cities, while requiring people to enter a lottery and pay large sums – sometimes more than $20,000 – for a fossil fuel car licence plate.
But a more realistic change in Australia might just be to tighten the vehicle efficiency standard so that we get more clean cars – and larger vehicles – on the roads as soon as possible.
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