Nothing in the budget for electrifying transport

Labor overlooks help to electrify Australia's transport sector which is projected to be the biggest source of emissions by 2030.

The federal budget has allocated virtually nothing to electrifying transport, despite the Department of Climate Change, Energy the Environment and Water (DCCEEW) projections that show transport will be the highest emitting sector in Australia by 2030.

This is in stark contrast to the $6.7 billion of funding allocated to the production of hydrogen, and a further $7 billion for critical minerals in a package totalling, by some estimates, more than $22 billion.

To put the importance of rapidly decarbonising transport into context, the lifespan of new light and heavy vehicles is around 15 years, which means that vehicles sold today will still be spewing out greenhouse gases in 2039. That highlights the urgency to bring in battery electric light and heavy vehicles now and rapidly phase out of new ICE vehicle sales.

But despite this, the federal government has chosen not to spend big on electrifying transport, while at the same time handing $6.7 billion to an as-yet unproven green hydrogen industry.

At this week’s inaugural Truck Show X, a future facing conference for the trucking industry, many speakers and attendees highlighted the major barriers facing the uptake of electric trucks including upfront cost and charging infrastructure.

Despite having significantly lower running costs and TCO (Total  Cost of Ownership), electric trucks are still more expensive to purchase up front.

While upfront purchase price is projected to come down significantly in the coming years, government could take a proactive role in seeding and accelerating the market by providing electric truck subsidies and funding for shared-use truck charging infrastructure.

If the heavy-vehicle industry received the same amount of funding from the federal government as the unproven hydrogen sector it could have a profound impact the speed at which transport decarbonises and therefore overall emissions.

The $6.7 billion allocated to green hydrogen could provide 67,000 subsidies equivalent to $100,000 for new electric prime movers.

Around 18,000 heavy-duty trucks were sold in Australia in 2023 meaning $6.7 billion could fund a $100,000 electric truck purchase subsidy on every single heavy-duty truck sold for the next 4 years. That would effectively supercharge the transition to electric trucks overnight.

That $6.7 billion would also provide more than enough funding to roll out electric truck charging stations across the country, enabling the transition and dramatically cutting deadly truck diesel exhaust pollution in cities and towns across Australia improving the health and wellbeing of millions of Australians.

Neglecting transport sector a major omission from budget

The government’s decision not to provide serious funding to help transport decarbonise, despite the climate change department identifying it will be the highest emitting sector by 2030, is a major omission from the budget and a major failure of the government climate policy.

The omission is even more striking after a recent report from the Guardian showed that most IPCC (Intergovernmental Panel on Climate Change) scientists expect the global warming to “blast past the 1.5C target”.

The Guardian report also found that almost 80% of scientists expect a rise of at least 2.5C above preindustrial levels which is considered a catastrophic level of heating.

With an average lifespan of around 15 years, the transport sector is going to take a lot longer to decarbonise than most politicians realise. It’s why it’s so critical we accelerate the uptake of new electric light and heavy vehicles right now.

Daniel Bleakley
May 26, 2024
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