Associate Transport Minister Julie Anne Genter unveiled her plan to get more EVs on the road this week. Photo / Mark Mitchell
Associate Transport Minister Julie Anne Genter unveiled her plan to get more EVs on the road this week. Photo / Mark Mitchell
A subsidy scheme which would have put an extra up to $2000 in the back pocket of Kiwis buying electric cars was scrapped by the Government as it was considered to be "poor value for money".
A plan requiring all cars to undergo an air pollution emissions test as partof warrant of fitness checks was also given the thumbs down by officials.
This is according to a Cabinet paper Associate Transport Minister Julie Anne Genter presented to ministers about the proposed Electric Vehicle (EV) feebate scheme, unveiled this week.
The Government is proposing legislation which would slash the price of imported electric and hybrid vehicles by up to $8000 in a bid to make greener cars cheaper for Kiwis.
To pay for this, the Government would slap a new fee of up to $3000 on the import of vehicles with the highest greenhouse gas emissions.
But Genter's Cabinet paper reveals this was not the only option officials at the Ministry of Transport considered when it came to reducing overall vehicle emissions in New Zealand.
One of the options was providing an upfront $1000-$2000 subsidy for EV and mandating that a certain proportion of vehicle sales in New Zealand had to be low emissions.
Officials also considered providing a GST exemption for EVs and requiring air-pollutant emissions testing as part of warrant of fitness checks.
California has a similar system in place, as do other jurisdictions and countries around the world.
Although all the policies were investigated, they were all scrapped as they were either "ineffective, poor value for money, or regressive".
But there are a number of other areas where officials say work is "being progressed".
The Government is looking at a voluntary vehicle scrappage scheme to accelerate the exit of less safe and higher polluting vehicles from the market.
It is also exploring the possibility of a second-hand EV leasing scheme aimed at reducing transport costs for low-income households and supporting EV uptake, as well as increasing the number of EV charging stations around New Zealand.
According to Government figures, of the top 10 most popular used imported vehicles sold to low-income households, seven would receive a discount.
The paper also said that average vehicle prices might increase in the short term as a result of the introduction of the clean car standard.
Genter also revealed yesterday that the Government wanted to introduce new clean car standards, which would require vehicle importers to reduce the average emissions by meeting an annual emission target.
"This may impact low-income households more as it would consume a greater proportion of their income," the Cabinet paper said.
The Productivity Commission has also warned that people on low-incomes would be hit the hardest from a feebate scheme such as the one the Government has proposed.
"The feebate scheme and the recommendation around putting emissions standards on imported vehicles would certainly have detrimental impacts on lower-income families," Productivity Commission chair Murray Sherwin told MPs in a select committee this year.
However, according to Genter's paper, any price increase will be in part, or fully, mitigated through the clean car discount.
"Almost 60 per cent of households buying new to the fleet vehicles are expected to either receive a discount or not incur a fee.
"Of the low-income households that purchase a new-to-the-fleet vehicle, more are expected to receive a discount than pay a fee."
According to Government figures, of the top 10 most popular used imported vehicles sold to low-income households, seven would receive a discount.
