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Federal Government commits to increased funding to electric vehicle infrastructure

Federal Government commits to increased funding to electric vehicle infrastructure

Australians considering making the move to purchasing an electric vehicle have been provided with even more support, with the Morrison Government revealing a significant financial boost to its investment in charging infrastructure.

The federal government has released details of the first national Future Fuels and Vehicles Strategy, supported by an expanded $250 million Future Fuels Fund investment. Of this, $178 million will be rolled out towards the development of electric vehicles and hydrogen infrastructure.

The federal government expects that the $250 million in Future Fuels funding will be matched by private investment, helping to create as many as 2,600 jobs.

The national energy grid is to undergo changes designed to ensure it can deal with the projected 1.7 million electric vehicles on the road by 2030. This expectation comes off the back of the federal government’s consideration of net-zero emissions by 2050.

The EV Council recently reported that battery electric and plug-in hybrid vehicles reached a record sales number of 8,688 in the first half of 2021, up from 6,900 in the same time frame in 2020.

There will also be a focus on collaberation with the states and territories to reduce the barriers of low-emission vehicle uptake in these areas. Further, the federal government has committed to ensuring consumers have access to “reliable, easy-to-understand” information on low-emission vehicles.

But not everyone is convinced

Federal Chamber of Automotive Industries Chief Executive, Tony Weber, said the announcement was a “welcome step” in encouraging the update of low-emission vehicles, but it may not go far enough.

“This move from the Federal Government will assist in providing the infrastructure Australia urgently needs to support more electric vehicles on our roads,” Mr Weber said.

However, the FCAI believes the Federal Government has “missed an opportunity” to create a vehicle emissions standard that will “set a clear target for addressing the objective of emissions reduction in the Australian economy and provide real momentum to reduce vehicle CO2 emissions”, according to the press release.

“Governments should focus on setting targets, not trying to pick winners through specific technology,” Mr Weber said.

“The availability of EVs in Australia is increasing as car manufacturers respond to growing demand, however the reality is that they still account for less than one percent of total vehicle sales year to date.”

“This means that the Government’s target for EVs to be 30% of new vehicle sales by 2030 is extremely optimistic,” he said.

The sentiment was supported by the EV Council, with CEO Behyad Jafari stating: “There’s no sugar coating it, Future Fuels is a fizzer.”

“If it contained fuel efficiency standards and rebates it would give Australians more choice. The best and most affordable EVs manufacturers are producing would make their way swiftly onto our market.”

“Fuel efficiency standards are the absolute bare minimum of what you would expect in any 21st century plan,” Mr Jafari said.

Prime Minister, Scott Morrison, however, believes that the Future Fuels and Vehicles Strategy delivers on the Government’s Long-Term Emissions Reduction Plan for achieving net zero emissions by 2050.

“We will not be forcing Australians out of the car they want to drive or penalising those who can least afford it through bans or taxes. Instead, the Strategy will work to drive down the cost of low and zero emission vehicles, and enhance consumer choice,” said Mr Morrison.

“Voluntary adoption of electric vehicles is the right pathway for reducing transport emissions over the long term. Stringent standards, bans or regressive taxes will limit choice and increase the upfront costs of cars for Australians,” he said.

How to afford a low-emissions vehicle

That being said, any progress towards boosting the investment into charging infrastructure, may help to increase the uptake of low-emissions vehicles in Australia.

Manufacturers are prioritising low-emission or zero-emission technology, with vehicles continuing to increase in range and performance. As the diversity of this vehicle type continues to grow, paired with infrastructural development from the Future Fuels and Vehicle Strategy, consumer demand may continue to rise.

One of the biggest barriers preventing everyday Aussies from transitioning towards this vehicle type is its price point, which is considerably higher than comparable internal combustion engine vehicles. If you’ve been contemplating purchasing a low-emissions vehicle, this is where a green car loan may lend a helping hand.

Green car loans are vehicle financing specifically for eco-friendly cars, including battery electric vehicles, hybrid electric vehicles, plug-in electric vehicles and low-emissions vehicles. Green car loans typically come with more competitive interest rates than standard car loans to incentivise borrowers to make sustainable choices.

Keep in mind it’s still crucial you compare your options against your budget and look at all factors of the green car loan, including fees and features, before making any financial decisions.

Compare popular green car loans

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This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.

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