Sales of electric cars in New Zealand have doubled and projected growth is expected to be ''exponential''.
However, experts in the vehicle industry say it's ''unrealistic'' to think the majority of motorists will change to electric vehicles anytime soon.
Overseas car manufacturers ultimately dictate the number of electric vehicles available and high costs are putting people off, they say.
In response, Transport Minister Michael Wood says the Government recognises there could be barriers to switching to electric cars and ''that's why we're looking at possible incentive schemes''.
''I expect to have more announcements later this year.''
The Government was weighing up proposals to take action on climate change with a raft of measures to meet New Zealand's 2050 carbon-neutral target, create new jobs and boost innovation.
The jobs created would take time, he said, as any mandate the Government introduced would need to ramp up over the first few years.
''Several countries with large forestry sectors like New Zealand's are having commercial success in manufacturing biofuels from wood, so this could be an opportunity for the sector in the Bay of Plenty.''
Legislation would be passed this year on CO2 targets for light vehicle imports and would begin next year to push more efficient cars, electric cars and petrol hybrids, Wood said.
''The target of 105g we are setting for 2025 was already achieved by Japan in 2014 and by Europe in 2020, so overseas car companies should already be able to start offering lower-emitting vehicles to us.''
Close to 70 countries, including the US, China and Brazil, have implemented biofuels mandates to increase the uptake of biofuels and reduce transport emissions, he said.
''We will engage with the industry and the public on the best way forward later this year.''
It was also making progress to reduce emissions by investing significantly more into public transport, rail, coastal shipping and walking and cycling.
''But there is more to do.''
Prime Minister Jacinda Arden said transport reforms were high on the agenda as emissions were only second after agriculture.
Climate Change Commission principal analyst Alexandra Aimer-Seton said its draft advice suggested at least 50 per cent of all light vehicles should be electric by 2027 and the whole fleet by 2050.
It had also recommended the Government stopped Aotearoa from receiving inefficient vehicles by introducing an emissions target for light vehicle imports.
''EVs, plug-in hybrids, conventional hybrids and smaller, more efficient vehicles will all help this target be met.''
The consultation period was still open but the reception had been positive and the motor industry and businesses are up for the challenge, she said.
''One of the issues that we have heard is that it will be important we have enough EVs coming into Aotearoa. This is why the commission has made recommendations to the Government to ensure we are receiving a good supply of EVs and to investigate ways to bulk procure.''
Households that replace their current petrol or diesel car with an electric one could be at least $1000 a year better off, she said.
''Maintenance costs are also lower because the engine design is more simple. Our projections are that most EVs will be cheaper to run and own (including purchase cost, fuel cost, and maintenance cost) within the next few years.''
Mark Gilbert from Drive Electric said in the last three years EV registrations have more than doubled and the projected growth in New Zealand and globally is ''exponential''.
New Zealand imports more than 100,000 new cars per year, he said and the latest figures on the Transport Ministry site show there were 6225 EVs registrations in 2017 compared to 11,766 in 2018.
''As EVs get closer to price parity (over the next three to five years), and supply increases, more and more of these vehicles will become electric.''
He said in his view: ''Unless we signal to the manufacturers of cars, and the exporters of second-hand cars, that we demand low emissions vehicles, we risk becoming a dumping ground for high emitting second-hand petrol cars."
However, a New Zealand Automobile Association spokesman said the actions proposed could have ''very large impacts on the vehicle industry in New Zealand and it is a complex area''.
Demand was surging all over the world for low-emissions and EV vehicles, so being able to source enough to meet the goals may be difficult, he said.
A recent survey found nearly a third of AA members think they are likely to switch to an EV within 10 years but they also are not willing to pay much more for their transport costs to deliver lower emissions.
''Some of the key challenges are that New Zealand is a tiny fraction of the global car market and decisions made by manufacturers in Japan, in particular, will dictate what vehicles are available for our fleet in the future.''
Drivers would collectively soon be paying about $800 million per year at the pump through the emissions levy on fuel.
''We want the Government to dedicate this money to measures that will reduce transport emissions and incentivise the uptake of low-emissions vehicles rather than it just going into the general government account as it presently does.''
Tony Hammond Motors sales manager Lachlan Hammond said business was 30 per cent up on last year which was ''huge''.
Customers wanted higher safety ratings and fuel economy but the price of cars had increased as secondhand models coming in from Japan had to meet electronic stability control regulations.
Electric vehicles were on people's minds but there had been more inquiries about hybrid cars.
In his view, while electric cars had more power they had less range and could only travel 150km compared to 600km on a full tank of gas.
Motor Industry Association chief executive David Crawford said the 2027 target for EVs was optimistic.
''It is our view no sooner than 2035 as it will take that long to be able to import alternative technologies in the numbers and types of vehicles we require.''
He was a fan of E-fuel, which ''is technically feasible''.
E-fuel was produced with the help of electricity from renewable energy sources, water and CO2 from the air. In contrast to conventional fuels, they do not release additional CO2 but were climate-neutral.
Meanwhile, Vehicle Importers Association chief executive David Vinsen said it had been involved with government working groups for the last four years.
''Our big concern is the targets they have set are far too steep. It was unrealistic in terms of the availability of stock and it will be costly consumers.''