Whichever way you look at it subsidising electric cars and taxing conventional cars doesn't make sense.
The electric car industry exists only because governments have provided huge direct and indirect subsidies for electric cars in the mistaken belief that it is a cheap and effective way of reducing emissions of carbon dioxide. It is not.
The Government's policy will hurt poor people most because taxing conventional cars will also increase the cost of second-hand cars. People who live in the country or run a business that needs pickups or minivans will have to pay more even though an electric vehicle is not a viable option. It may well increase emissions because many people will retain their elderly conventional vehicle rather than accept the cost and inconvenience of an electric vehicle.
Subsidised electric cars won't make much difference to New Zealand's emissions of CO2 because, for the next five years or more, the extra electricity needed can only come from burning more coal at Huntly power station. When the CO2 emitted during battery production is taken into account, worldwide emissions may well increase.
Air pollution may well be worse because particulates from tyre and brake wear are now a major source of transport pollution. Electric vehicles are much heavier because of the extra battery weight so they contribute about 20 per cent more particulates.
The Government seems to be ignorant of the problems surrounding battery supply and cost. Sixty per cent of the cost of batteries is raw materials and, due to increasing demand, prices are going up.
To provide all the batteries needed to fulfil expectations in the Western world, many new mines will be needed. Experience tells us that it takes 16 years to develop a new mine so, at the best, it could be 20 years before the price of raw materials drops substantially – or a brand-new battery technology is developed and implemented.
The Government has ignored the potential for conventional cars to become much more
efficient. New engines that are 50 per cent more efficient and have 70 per cent of the emissions of current technology are now being trialled. An electric car has no advantage over a conventional car with such an engine.
Reducing emissions of CO2 by promoting electric cars is very expensive. According to the American Economic Association, switching to electric cars costs between $400/tonne and $1000 per tonne of CO2 saved.
There are many better and cheaper ways of reducing emissions of carbon dioxide, such as more efficient internal combustion engines, switching to reliable and safe nuclear power and by reducing coal consumption at Huntly by encouraging the gas industry to develop our gas resources including shale gas in the South Island.
Providing the electricity for all these electric cars is a major problem. By 2035, electricity generation will need to have increased by at least 30 per cent. Where will it come from? Not from gas, not from coal, not from hydropower. It could come from nuclear power.
The Government hopes it will come from wind power and hopes that the problem of keeping the lights on when the wind isn't blowing by storing the surplus electricity when the wind is blowing can be solved at an acceptable cost and in the required timeframe.
Sixty years of experience in the electricity industry tells me that this is a virtually impossible task.
Because Lake Roxburgh has very little storage, the Onslow pumped storage project would need to have a new huge storage lake on the Clutha River to supply the water being pumped to the upper lake when the wind is blowing hard.
Providing charging facilities is also a major challenge. For example, most of the electric cars traversing the Desert Road will need to recharge their batteries at Tokaanu or Waiouru.
At times, 800 cars per day might need to charge their batteries before traversing the 70km sector. If charging takes half an hour, 35 charging stations each rated at 50 kW will be needed. The power they use would supply 600 houses.
Perhaps the biggest problem is that the policy assumes that people will rush to buy electric cars when the reality is that an electric car is little different from a conventional car with a tiny fuel tank that takes more than half an hour to fill.
Why would anyone want to buy a vehicle that is more inconvenient and more expensive?
Electric cars cannot be expected to sell as well as a Model T Ford that was cheaper and much better than a horse and cart.
Every way you look at it, the electric car policy is a very expensive way of reducing CO2. The Government's policy penalises poor people and subsidises those rich enough to buy
an electric car.
• Bryan Leyland is a power systems engineer with 60 years' experience in New Zealand and overseas.