The Federal Government’s proposed National Vehicle Emissions Standard is open for consultation on until 4 March 2024.

The Department of Infrastructure and Transport estimates the improved vehicle efficiency standard will save Australian drivers about $100 billion, and have cumulative emissions savings of 370 million tonnes of CO2-e over five years.

All developed economies in the world have vehicle emissions standards, with the exception of Russia and Australia. 

The particles from tail-pipe emissions damage our lungs, cause respiratory and heart illness, and cause global warming. Transport emissions account for 25% of Tasmania’s greenhouse gas emissions, and 19% in Australia.

Australia has the second highest passenger vehicle emissions per person in the developed world, after Saudi Arabia. For comparison the United States, where large vehicles and big distances are common, has 20% lower emissions and cost per kilometre driven, per person. The US has had a vehicle emissions standard since 1970. 

The proposed Australian standard caps CO2-e for the “fleet” of vehicles imported and sold by car makers each year. It would apply to all new cars, SUVs, four wheel drivers, vans and utes below 3.5 tonnes.

The current proposal is two caps to start in 2025, at 141 grams per kilometre for small cars, and 199 grams per kilometre for large cars, vans and utes. 

For reference, a Nissan Qashqai emits 146 grams per kilometre, and an entry level Ford Ranger emits about 200 grams per kilometre, according to the Department of Infrastructure and Transport.

Both caps would fall each year by about 12% until 2029. The cap is averaged over each vehicle maker’s fleet, so the maker can sell vehicles that exceed the cap if they also sell an equal proportion of vehicles that fall under it.

If the maker beats the target, they are awarded with NVES credits at the end of each year, and if they fail to meet the target, they receive debits. Both credits and debits can be banked for two years and traded with other makers. Makers can also combine their “fleets” with other makers for accounting purposes.

This is called a cap and trade system, and is modelled off other systems around the world. It creates a market wide incentive for all vehicle users to save money and emissions by purchasing cheaper and more efficient vehicles.

So how will this affect Tasmanians? 

The net effect of the policy is that Tasmania could save up to $1 billion per year on fuel costs and slash one of our largest emissions sources on the island by up 25-30% in about 10 years.

It’s important to note that other countries with vehicle emissions standard have similar priced or cheaper vehicles available, and lower emissions per kilometre driven than Australia. The evidence shows that emissions tend to fall, whilst prices stay the same for higher emissions vehicles, but fall for lower emissions vehicles.

The standard only effects new vehicles, and is not intended to apply to large commercial vehicles, such as trucks.

You can make a submission to the proposed standard via the Department of Infrastructure and Transport website, or here via carbonzero.org.au/nves-submissions.