COP26 should be an accelerant to electric vehicle adoption in Australia, and globally

Image: BYD delivers 1st of 150 EV busses to Glasgow

Tomorrow may be Halloween, but it also marks the start of the 2021 United Nations Climate Change Conference known as COP26.

For nearly three decades the UN has been bringing together almost every country on earth for global climate summits – called COPs – which stands for ‘Conference of the Parties’. This year will be the 26th annual summit – giving it the name COP26. With the UK as President, COP26 takes place in Glasgow.

This year there are 4 key focus areas for the event, detailed below. Many of us understand Climate Change and the impacts it is having on our environment, but often people struggle to understand concrete changes they can make in their lives to help.

One very practical thing you and your family can make is to consider an electric vehicle when you next purchase or lease a vehicle.

The transport sector is responsible for Australia’s 3rd largest source of greenhouse gas emissions at 17.5%, while electricity generation is responsible for the most at 33.2%.

If you think the primary responsibility lies with those big diesel trucks or millionaires flying jets and helicopters around, think again, cars are responsible for roughly half of Australia’s transport emissions.

This means transitioning to an electric car, particularly when you charge it using renewable energy like solar on your roof, you could significantly contribute to the reduction of emissions in our country. This is being achieved in many countries internationally and Australia is lagging behind many developed countries in their adoption of electric vehicles.

Heralded by the world as early adopters of technology, Australians are unfortunately late to the game when it comes to the uptake of EVs, this year nudging just north of 1% of new vehicle sales. Other comparable countries have many times that rate and Norway, the leaders in the world in EV adoption, achieved another record with a massive 77.5% of new car sales being pure electric.

Even back in 2017 the Climate Council were able to identify some of the reasons our transition was slower than it should be. Unlike Europe, we lack the emission standards that would place downward pressure on high emitting vehicles. Australia is also a country with large distances between towns, which means you’ll ultimately require a larger battery capacity than practical elsewhere. Given battery costs remain the highest single component cost of an EV, the price points remain high.

Recently state Governments have moved to offer incentives on new EV sales, discounting the price by a few thousand dollars and in some states eliminating stamp duty and registration costs. These are working, but are not enough.

Many other countries have federal incentives to encourage more automakers to launch EV products in their market and with enough competition, prices reduce, the consumer wins and the country benefits by reducing their transport sector emissions.

Australia’s Prime Minister Scott Morrison is heading to COP26 to confirm Australia’s commitment to Net-Zero emissions by 2050. To achieve that milestone, we need to act now. The basic maths on the situation is this. Vehicles often have a practical life of around 15 years. If we still have ICE vehicles being sold after 2035, those cars will be emitting beyond 2050, or we face a financial burden at that stage of paying people to stop driving their cars.

Other countries are already banning ICE vehicle sales by 2035 and some more aggressively are nominating 2030 as the end. As more countries commit to these timelines, it sends a very clear signal to automakers, that they won’t have a market to sell to, unless they convert their businesses from ICE to EVs.

We have seen the beginnings of this, with Tesla dominating electric vehicle sales, but while other large volume legacy brands are talking a big game, they lack the urgency required to achieve this. Many are going nameplate by nameplate and identifying challenges like Covid-19 and the international chip shortages as reasons for delays, but the climate cares not about these things.

Each year, there are around a million new vehicles sold in Australia and that means every year we delay action on our EV transition, is another year those million vehicles will be emitting into the atmosphere.

In 2020, SUVs accounted for 49.6% of the market, growing from 45.5% the year before. The next highest category was passenger vehicles made up 24.2%, down from 29.7% the year before. This is followed by Light Commercial Vehicles (read: Utes), claiming 22.4% market share.

When we consider the EV options in Australia for these market segments, there’s not a great story to tell. When it comes to all-electric SUVs on offer in Australia right now, there’s the MG ZS EV which starts at just under $40k, or the Kona Electric from around A62k, the Volvo XC40 Recharge is sold out for the year, but costs around $76k.

From here, you then see a big jump to the premium brands of Mercedes, Audi, Jaguar and soon one from BMW. We are currently waiting for the Tesla Model Y to be offered in Australia, so the only option there is the Model X which is not available until late 2022 and is around $200k on the road.

So while the list of EV SUVs in Australia slowly grows, the SUV ICE market is saturated with choices and the buyers of 454,701 SUVs last year, simply need more options to consider before moving.

When it comes to electric ute options, there aren’t any, so the 205,597 tradies have nowhere to go right now if they want an EV.

It is estimated that to bring a vehicle to Australia, the cost is somewhere around the $1M mark, which is something the Federal and State Governments could work together to reduce and help promote more brands, like the VW, to bring their EVs to Australia.

Local councils appear to be dipping their toes in the water with 1-2 EV purchases or leases, but if the Government wants to help the situation, they could and should consider bulk fleet purchases. Put the contracts out to tender and let the EV manufacturers bid for the work. The successful candidate would then be assured of X vehicle sales, making it financially viable for them to import the car to Australia. Consumers ultimately benefit from this, with higher volume manufacturing, ultimately leading to lower costs, as well as the opportunity to prime a 2nd hand EV market over the coming years as these cars come off lease.

This year the UK will play host to the COP26 conference which means there is a spotlight on their environmental policies, which helps set the benchmark for countries like Australia to follow. The UK was the first to legislate net-zero carbon emissions by 2050, is the largest producer of offshore wind energy in the world, and is ending direct government support for the fossil fuel industry.

Importantly, the UK has already announced the end of new petrol and diesel cars in the UK by 2030, putting the UK on course to be the fastest G7 country to decarbonise cars and vans. Why would they do that? Because they know achieving net zero by 2050 depends on getting the transport sector transitioned, let’s hope Australia realise that soon.

COP26 Priorities

1. Secure global net zero by mid-century and keep 1.5 degrees within reach

Countries are being asked to come forward with ambitious 2030 emissions reductions targets that align with reaching net zero by the middle of the century.

To deliver on these stretching targets, countries will need to:

  • accelerate the phase-out of coal
  • curtail deforestation
  • speed up the switch to electric vehicles
  • encourage investment in renewables.

2. Adapt to protect communities and natural habitats

The climate is already changing and it will continue to change even as we reduce emissions, with devastating effects.

At COP26 we need to work together to enable and encourage countries affected by climate change to:

  • protect and restore ecosystems
  • build defences, warning systems and resilient infrastructure and agriculture to avoid loss of homes, livelihoods and even lives

3. Mobilise finance

To deliver on our first two goals, developed countries must make good on their promise to mobilise at least $100bn in climate finance per year by 2020. 

International financial institutions must play their part and we need work towards unleashing the trillions in private and public sector finance required to secure global net zero.

4. Work together to deliver

We can only rise to the challenges of the climate crisis by working together.

At COP26 we must:

  • finalise the Paris Rulebook (the detailed rules that make the Paris Agreement operational)
  • accelerate action to tackle the climate crisis through collaboration between governments, businesses and civil society.
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Jason Cartwright
Jason Cartwright
Creator of techAU, Jason has spent the dozen+ years covering technology in Australia and around the world. Bringing a background in multimedia and passion for technology to the job, Cartwright delivers detailed product reviews, event coverage and industry news on a daily basis. Disclaimer: Tesla Shareholder from 20/01/2021

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