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Vehicle CO2 emissions D-Day looms

All change: The Australian government’s proposed CO2 emissions cut target is expected to help steer consumers to more efficient vehicles such as the new BMW i3 that is due in Australian showrooms in the first quarter of this year.

Motor industry, federal government thrash out CO2 emissions cut target

4 Jan 2018

THE Australian motor industry says it hopes it will have a federal government decision this year on proposed mandatory carbon-dioxide (CO2) emissions restrictions for vehicles sold in Australia.

Although CO2 emission reductions have been voluntary to date, the government is proposing to set a compulsory target designed to speed up fuel efficiency improvements and the introduction of low- or zero-CO2 vehicles.

Federal Chamber of Automotive Industries (FCAI) chief executive officer Tony Weber said today that his organisation – representing motor manufacturers – was deep in discussion with the government on the issue, but that progress was slow.

He said a key to the proposed restrictions was fuel quality, which the industry believes is of insufficient standard in Australia to allow the introduction of new-generation engines requiring high-standard, low-sulphur 95-RON fuel.

A crucial federal government regulator paper on fuel quality in Australia – due for release soon – could play a critical role in the CO2 decision.

Mr Weber said the industry supported a mandated CO2 target, as long as it was relevant to Australian market conditions.

“While progress (on talks) is slow, we are hopeful of reaching an outcome this year, which will allow the industry to transition to a CO2 target without restrictions in the choice of vehicle on offer in Australian consumers,” he said.

“And this, we believe, is a vital point often overlooked in this discussion. As an industry, we embrace diversity of choice, but without a well-ordered transition to a realistic emissions target, which suits our market, that vehicle diversity that consumers have been accustomed to in Australian showrooms may well be diminished.”

Mr Weber said the petroleum industry was saying it could provide high-quality, low-sulphur fuel in the Australian market by 2027.

“That is a long time away,” Mr Weber said, adding that typical vehicle model cycles were a minimum of five years.

Mr Weber said that despite the advent of electric and fuel-cell vehicles, petrol and diesel vehicles would still dominate the market for the next decade.

He said the FCAI did not favour subsidies for electric vehicles (EVs), but rather broader incentives for more efficient vehicles.

This is contrary to the position of some FCAI member companies that have called for federal EV subsidies.

“I think this is a technology neutral debate,” he said. “I don’t see that one form of propulsion should be subsidised over another.

“I think what we need is a holistic approach to this, that the government needs to adopt, and that includes fuel quality, when we move to Euro 6 (emissions standards), and a CO2 standard.”

Mr Weber said there were a number of ways people could be encouraged to move to more efficient vehicles via incentives.

“What we need to do is to make that transition so that the Australian lifestyle and way in which we work, especially on farms and in the mining industry, so they are not adversely affected.”

In 2016, the federal Labor Party announced a policy that would cut vehicle CO2 emissions by 40 per cent, from 184 grams per kilometre to 105g/km by the middle of next decade.

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