Car-makers demand mandatory CO2 emissions limits

Australia’s new-vehicle brands have called on the federal government to introduce a mandatory CO2 emissions reduction target “sooner rather than later” rather than focus only on the encouragement of electric vehicle sales.

But there appears little chance of any action on CO2 any time soon, especially with a federal election due by May 2022.

The federal government has been investigating for years when it might introduce the Euro 6 noxious emissions standard (mandated in Europe in 2015) and has committed to improving fuel quality.

It has also invested some money in promoting Australian EV sales through charging infrastructure roll-out, although state governments – especially in NSW – are well ahead of it, offering financial incentives to EV buyers.

But according to people familiar with current federal government thinking, there is no movement whatsoever on vehicle CO2 emissions, a global warming gas produced by the internal combustion engines that the vast bulk of Australians continue to buy.

Reducing light vehicle CO2 emissions limits have become a government legislative weapon around the globe. Australia is one of few developed countries without such a scheme, a by-product of the political ‘climate wars’ that have raged in this country for more than a decade.

The only CO2 emissions target car manufacturers have in Australia is a voluntary standard introduced by their own industry body, the FCAI, in 2021.

The local car industry has argued for years that a lack of CO2 rules and lax fuel standards have hurt Australian new-vehicle buyers.

Federal Chamber of Automotive Industries chief executive Tony Weber used last week’s annual vehicle sales press conference to raise the CO2 issue.

“We want to have a target that is sensible and realistic because it sends the right message to [vehicle manufacturer] headquarters’ around the world that Australians wants the best technology as an option in their showrooms.

“Until we have an emissions target that position is very difficult.

“Hopefully, we will get that sooner rather than later and hopefully it will be at a national level.

“That is one thing that concerns me out of 2021; we have seen a number of states and territories go down their own path … Australia is too small to have eight different jurisdictions with a de facto CO2 standard.

“We need one standard, we need national leadership on this issue.”

Weber framed his CO2 comments in the context of the need for governments to not only focus on the promotion of EVs.

“We must recognise the policy objective should be to lower our CO2 emissions rather than meeting sales targets of particular types of technology. The FCAI maintains the need for national leadership in the form of a technology agnostic and achievable emissions reduction target,” he said.

“Give us the target and we will give you the technology mix to get there,” Weber added.

In its statement released to coincide with the media briefing, the FCAI pointed out EVs accounted for just 0.49 per cent of new vehicle sales in 2021.

However, runaway EV leader Tesla and its 10,000-plus sales are not included in the data and therefore skewed the share downward by around a percentage point.

According to a story published in The Canberra Times last Friday, this is because Tesla and the FCAI are in dispute over fees the EV brand would have to pay to be included in official sales data.

“Tesla is a member of the FCAI but they don’t contribute to VFACTS data and this is their policy right around the world,” Weber said at the briefing. “It is unfortunate but that is the reality.

“We don’t hide from the fact they sell a number of vehicles in this country and the EV number would be bigger if you put Tesla’s sales in there.

“However, it doesn’t change the basis of our assumptions; the number of full battery-electric vehicles is still very low as a proportion of the total market and, yes, it will grow over time and Tesla will be a big player in that market.

“But it still doesn’t take away from the basic message that the penetration of full battery-electric [vehicles] in Australia is extremely low.”

Weber was most optimistic about improving fuel quality standards, which go hand-in-hand with cleaner, higher-tech engines and lower emissions.

Australia currently permits sulphur content up to 150 parts per million (PPM) for regular unleaded petrol and 50ppm for 95 and 98 RON fuel.

Global best practice is 10ppm, which Australia should finally reach in 2024 after federal government-backed upgrades to Australia’s two remaining oil refineries.

“We hope the fuel quality issue can be addressed so that Australian motorists and our members we can import cars that don’t have to be modified for Australia’s poor quality fuel, because that will make our cars cheaper and grant us access to a greater range of ICE technologies and that affects not only straight ICE engines but also hybrid and plug in hybrid engines,” said Weber.

“So that’s not only important for today but the future.”