LISTEN ABOVE AS HENRICK MOLLER SPEAKS TO MIKE HOSKING
The Government will have to offer up more carrots if it wants motorists to swap petrol for power, a survey of electric vehicle (EV) owners has found.
More than three quarters of owners who took part in a new poll believed cash incentives would be needed if more than half of new vehicle registrations were to be electric by 2025.
Of more than 66,000 new or used light vehicle registrations in the first three months of this year, just over 800 were EVs.
As at last month, New Zealand's EV fleet stood at 9,241 - although that was still a big leap from the 206 EVs recorded at the same time five years ago.
Emeritus Professor Henrik Moller, of the University of Otago's Centre for Sustainability, has been tracking the views of hundreds of Kiwi EV owners as part of a citizen science project dubbed Flip the Fleet.
"We are constantly fielding questions about costs and the practicality of EVs," he said.
"The higher cost of buying an EV puts many people off, even though their running costs are a lot lower than for a combustion vehicle of about the same size and power."
"Finding a way to subsidise the initial purchase and further reduce EV running costs would be a game changer in New Zealand."
The survey findings suggested subsidisation of new EVs was the main way that New Zealand could secure enough supply of high-quality EVs to meet demand.
"There will be huge scramble for the EVs around the world in the coming decade, so our relatively small market is unlikely to compete unless we subsidise the manufacturers, dealers and purchasers to buy electric vehicles."
New Zealand had so far built its EV fleet mainly by importing second-hand cars from Japan and the UK - the only readily available sources of left-hand drive EVs.
New Zealand had thereby indirectly benefited from subsidies paid to the original owners by the Japanese and UK governments, Moller said.
"Reliance on second-hand EVs means we get the new EV technology late and the manufacturer's warranty is voided when it is exported from its country of origin," he said.
"We are soon going to have to pay our own way by subsidising purchase of new EVs for sale in New Zealand if we are to secure an adequate supply of the latest high-quality EVs with full manufacturers' support."
The most favoured financial intervention suggested by the EV owners was a system of "feebates" where highly emitting combustion vehicles were penalised by having to pay
higher registration fees.
This additional fee - recently proposed in a Productivity Commission report looking at how to shift to a low-carbon economy - was then transferred and distributed across the lower-emitting vehicles like hybrids and electric vehicles.
"It's just another form of the polluter pays principle," he said.
"Feebates could be set to be fiscally neutral, so the tax payer is not subsidising uptake.
"Instead, those choosing bigger and less fuel-efficient cars are subsidising others that choose low emission vehicles."
Other proposed interventions included a revision of the Fringe Benefit Tax rules, higher depreciation rates for tax write-offs of EVs, removal of GST on new EVs, reduced or even free electricity at off-peak times, low interest loans for buying EVs, lower insurance costs, more stringent Warrant of Fitness checks for emissions, and increasing road user charges on the higher emitting vehicles.
"Some of our members think this survey put the cart before the horse," Moller said.
"A rethink of the Government's current EV target, to have 64,000 EVs registered by 2021, is needed first.
"We don't know what that target was based on, nor whether it will be enough to put us on track to deliver New Zealand's zero carbon economy ambitions and meet our international obligations for combating climate change."
"Once a meaningful target is established, a thorough cost-benefit analysis can follow to identify how much public money is needed to maximise the benefits for all New Zealanders and our environment."
The Government's current efforts have also included supporting the roll-out of new charging facilities, funding awareness campaigns and a contestable innovation fund, reviewing tax depreciation rates, and looking at special highway lanes for EVs.
Its proposed Zero Carbon Bill assumed EV uptake - potentially reaching 95 per cent of vehicles by 2050 - would make a key difference in slashing emissions over coming decades.