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The transport sector is Australia’s second fastest growing source of carbon dioxide emissions and yet we still don’t have any standards which apply to new vehicle fuel efficiency.

Road transport contributed 16% to total CO2 emissions in 2000 and this grew to 18% in 2010 and 21% in 2016.

We are the only OECD country with no minimum fuel standard while more than 80% of the global vehicle market has adopted fuel standards. We have had standards for many years relating to other vehicle emissions such as nitrous oxides, carbon monoxide and particulates.

Standards in other countries

The EU applied mandatory standards from 2009 requiring a light vehicle fleet average of 130 g CO2/km by 2015 and 95 g/km by 2020–21.

These standards have been further developed requiring a reduction by 15% by 2025 and 37.5% by 2030 relative to 2020–21. Standards will also be applied to heavy vehicles.

The USA has had voluntary standards since 1975 that have not been effective. In 2012 standards were introduced including a reduction by 3% each year after 2012 applied to each manufacturer. They are enforced with the potential of the loss of licence to sell vehicles. The effective standard is slightly higher than applies to the EU. However President Trump is now threatening to loosen the standards.

Testing methods are problematic

The sources used for this article comment on ongoing issues with the testing methods being used to monitor vehicle fuel use.

The standard methods used in Europe were developed in the 1970s. They are called the New European Drive Cycle (NEDC) and they have been found to be unrealistic because they assume that the car is being driven at a constant speed with mild acceleration. Actual consumption that has been tested in real conditions show the gap is getting worse and is now believed to be about 40%.

The sources don’t explain why the gap is getting worse apart from the legal methods of manipulating the tests, e.g. by using low-resistance tyres. The latest EU standards will require cars to have on-board monitoring systems in future.

Clearly there is a need for proper testing of on-road vehicle emissions. One wonders about the accuracy of the greenhouse gas reporting for Australia’s transport emissions. The same applies to reporting by other countries.

The standards are applied on a fleet wide basis but then manufacturers have to apply the standard to their individual range of vehicles. The projection of future emission levels requires an estimate of the nature of the vehicle fleet that is a combination of several cohorts of ages of vehicles plus the average distances travelled by each type of vehicle.

Australia’s experience

The current situation is that in 2017 Australia’s light passenger average CO2 emissions were 172 g/km compared with 118.5 g/km in the EU. In the case of light commercial vehicles Australia’s average was 222 g/km compared with 164 g/km in the EU.

In addition to the lack of efficiency standards, according to a report from Transport Energy/ Emissions Research [1] several other factors contribute to Australia’s higher vehicle emissions:

  • Use of heavier and greater engine capacity cars such as SUVs (even in comparison with the USA). It is reported that in 2017 the average fuel use in Australia was 20% higher than in the USA. This trend is getting worse.
  • Use of automatic transmissions that are reported to be less fuel efficient.
  • Greater distances travelled. The Australian Bureau of Statistics reported that total travel by passenger vehicles in Australia was 142 billion kilometres in 2000. This has been growing to 176 billion kilometres in 2016, an increase of 24%.
  • The most fuel efficient model choices in Australia are not as efficient as in Europe leading to the suggestion that manufacturers are taking advantage of our lack of mandatory standards.
  • Our vehicle fleet is older than in other countries and turnover is slower so it takes longer for the benefit of newer, more fuel-efficient vehicles to flow through to the fleet as a whole. Conversely driving a vehicle for a longer period could produce lower emissions when allowance is also made for the emissions during manufacture.

It is also suggested that Australians are paying paying about 30% more for fuel than they should (provided better fuel efficiency doesn’t encourage more driving).

Australia’s attempts to introduce standards

Australia has had voluntary efficiency standards since 1978 that were equivalent to 195 g CO2/km (2000) and 161 g CO2/km (2010) but these have not been achieved.

In 2010, the ALP government decided that mandatory CO2 emissions standards would apply to new light vehicles from 2015, i.e. a national fleet wide average of 190 g/km in 2015 and 155 g/km in 2024. However, the change in government in 2013 meant the standards would not see the light of day.

Several reports have been written analysing the options for introducing standards.

The Climate Change Authority produced a report in December 2016 that proposed that the first phase of mandatory standards be introduced with effect from 2018, by which time local manufacture of automobiles was expected to have ceased.

The standards would progressively reduce CO2 emissions from new light vehicles to 105 g/km in 2025, almost half the then current level of 192 g/km. This 2025 standard would broadly bring Australia into line with the USA and still trail the tighter EU targets by several years.

A Ministerial Regulation Impact Statement found that the introduction of a standard of 105 g/km phased in over 2020–25 would cost $16.2 billion compared with no standards but would lead to:

  • national fuel savings of $27.5 billion
  • reduce greenhouse gas emission by 65 Mt by 2030
  • create an overall net benefit to the economy of $13.9 billion

This calculation allowed for a cost of carbon emissions of about $50/tonne.

The Automotive Association has lobbied against the proposal on the grounds that cars will be more expensive. Implementation of a standard to reduce CO2 emissions to 105 g/km is estimated to increase the average cost of a new car in 2025 by about $1500. This, however, would be offset several times by fuel savings of about $8500 over the life of the vehicle, leaving motorists better off.

How about electric vehicles?

The rollout of electric vehicles in Australia is being held back by their cost and lack of recharging stations. Labor’s election proposal to require that 50% of new passenger vehicles sold be electric vehicles by 2030 was hysterically dismissed by Scott Morrison. He claimed the policy would make life impossible for tradies as the ute would be uneconomic and it would spell the end of the weekend trip away in the SUV.

Of course this was all nonsense as the cost of electric vehicles is coming down rapidly and is expected to be similar to internal combustion engines by 2025. We might even revive the local manufacturing industry? In any case perhaps it would be a good idea to hire a large SUV for a weekend trip rather than driving these large vehicles around to drop the kids off at school or commute to work.

One question about the use of electric vehicles is the carbon emissions if they are being recharged using electricity from the current high use of coal-fired generation. The data I have found indicates that electricity consumption to run an electric vehicle could be 6–10 Kw h per 100 km. Currently Australia’s emissions from electricity generation is 800 g/Kw h. So that equates to carbon emissions from electric vehicles of 48–80 g/km.

Conclusion

The available evidence suggests that legislative action regarding vehicle CO2 emissions is long overdue. The federal government must take action to ensure total CO2 emissions from road transport are reduced by introducing emission standards and by taking several additional measures such as increasing public transport and reducing distances driven.

Introducing these new regulations quickly is a priority because it takes years for them to actually work their way through the market to the new vehicle fleet.

References

[1] Transport Energy/Emission Research Pty Ltd Vehicle CO2 Emissions Legislation in Australia – A Brief History in an International Context

[2] Light Vehicle Emissions Standards for Australia

Published in STEP Matters 201