NZ’s elec­tric ve­hi­cles sales are too low

The Hutt News - - CONVERSATIONS - ROB MAETZIG

OPIN­ION: Ja­pa­nese ve­hi­cle man­u­fac­turer Mazda raised a few eye­brows re­cently when it an­nounced that when it be­gins in­tro­duc­ing elec­tric ve­hi­cles and other elec­tric drive tech­nolo­gies from next year, it will only of­fer them to ‘‘clean’’ coun­tries.

In a me­dia re­lease de­tail­ing what it calls Sus­tain­able ZoomZoom, which is its long-term vi­sion for tech­nol­ogy de­vel­op­ment, the brand said it will only sell its EVs in re­gions that use a high ra­tio of ‘‘clean’’ en­ergy for power gen­er­a­tion or re­strict cer­tain ve­hi­cles to re­duce air pol­lu­tion.

On the face of things that’s a very big call, be­cause all of the world’s big­gest new ve­hi­cle mar­kets are hope­less in gen­er­at­ing power us­ing re­new­able sources such as hy­dro and wind.

In USA for in­stance, only about 15 per cent of elec­tric­ity is gen­er­ated the re­new­ables way. In Aus­tralia it is less than 17 per cent. Even in Mazda’s home coun­try of Ja­pan the fig­ure is just 17.4 per cent.

In the fos­sil fu­els-rich coun­tries of Kuwait and Saudi Ara­bia no elec­tric­ity at all is gen­er­ated us­ing re­new­ables, and in the United Arab Emi­rates the fig­ure is al­most as bad at 0.23 per cent.

Hardly high ra­tios.

So with that as back­ground, New Zealand can feel rather proud that it is se­cond-best in the world in the way we gen­er­ate elec­tric­ity. Hy­dro, wind and geo­ther­mal en­ergy com­bine to pro­duce 85 per cent of our power, with the re­main­der gen­er­ated us­ing gas and coal.

Our per­for­mance is not that far be­hind the top coun­try, Nor­way, which gen­er­ates 97.9 per cent of its power us­ing re­new­ables. Other coun­tries that are per­form­ing well in­clude Colom­bia at 82 per cent and Brazil at 81.2 per cent.

So does this mean we can feel all self-sat­is­fied and now sit back and wait for car com­pa­nies such as Mazda to come zoom-zoom­ing to us with se­lec­tions of brand-new fully-elec­tric and plug-in hy­brid of­fer­ings?

The an­swer has to be no – be­cause although we’re up close to Nor­way in gen­er­at­ing our elec­tric­ity the green way, we’re nowhere near match­ing the Scan­di­na­vian coun­try when it comes to our take-up of elec­tric ve­hi­cles.

In the past few days there’s been a fair amount of crow­ing over the fact that the num­ber of elec­tric ve­hi­cles on New Zealand’s roads has grown 2290 per cent since 2013.

The might sound im­pres­sive, but the ac­tual num­ber of such ve­hi­cles is 4500 – which is not many. Look at it an­other way: dur­ing Au­gust 331 EVs were reg­is­tered – a pit­tance com­pared to the 13,063 new ve­hi­cles and 14,483 used im­ports reg­is­tered dur­ing the same month.

It’s es­ti­mated that the 4500 EVs now in use in New Zealand rep­re­sent less than 1 per cent of our to­tal car ‘‘park’’. Com­pare that to Nor­way (which is not much big­ger than us, both in terms of land area and pop­u­la­tion), which boasts more than 150,000 EVs and plug-in hy­brids. Not only that, but last year 40 per cent of all new ve­hi­cles reg­is­tered in that coun­try were EVs.

There’s a les­son to be learned in all of this for New Zealand. Statis­tics and sur­veys show that the Nor­we­gian ac­cep­tance of EVs is not nec­es­sar­ily for en­vi­ron­men­tal rea­sons – but eco­nom­ics. Nor­way’s gov­ern­ment of­fers gen­er­ous sub­si­dies for EVs (and im­poses re­stric­tions on the use of con­ven­tional ve­hi­cles), and that’s pri­mar­ily why the lo­cals buy the cars.

Re­cent sur­veys showed that 72 per cent of buy­ers are choos­ing their elec­tric cars for eco­nomic rea­sons, and just 26 per cent for en­vi­ron­men­tal rea­sons.

And statis­tics from neigh­bour­ing Den­mark sup­port this. They sug­gest that if the sub­si­dies weren’t in place, this takeup of EVs might dis­ap­pear. In 2015 Den­mark re­in­stated regis­tra­tion taxes on EVs af­ter some years of ex­emp­tions – and sales last year fell 68 per cent.

So what does all this tell us? How about this: in stark con­trast to the sit­u­a­tion in Nor­way, so far our takeup of new elec­tric ve­hi­cles has largely been for en­vi­ron­men­tal rea­sons. The elec­tric ve­hi­cles on of­fer here new are sim­ply too ex­pen­sive for the rea­sons to be oth­er­wise.

That also ex­plains why close to half all EV sales so far in New Zealand have been used Nis­san Leafs im­ported from Ja­pan and the UK, the prices for which are prob­a­bly ben­e­fit­ing from fi­nan­cial in­cen­tives of­fered in their home mar­kets.

All this means the key to mass ac­cep­tance of new EVs is for the Gov­ern­ment to stump with fi­nan­cial in­cen­tives.

Although the Gov­ern­ment wants the takeup of EVs to reach 64,000 ve­hi­cles by 2021, it isn’t do­ing much to help the coun­try achieve that goal. So far it is spend­ing $1 mil­lion a year on in­for­ma­tion and pro­mo­tion aimed at try­ing to con­vince peo­ple to buy, ex­empt­ing the ve­hi­cles from road user charges un­til they make up 2 per cent of our to­tal ve­hi­cle fleet, and let­ting EV users drive on pri­or­ity lanes in Auck­land.

Com­pared to Nor­way, that’s nowhere near enough. In that coun­try, elec­tric ve­hi­cles are ex­empt from VAT and pur­chase tax which on av­er­age re­duces their prices by up to 50 per cent – which means their prices are about the same as con­ven­tional ve­hi­cles. On top of that there are all sorts of other in­cen­tives such as free park­ing, free charg­ing, and ex­empted lanes on trunk routes.

Lit­tle won­der then that EVs com­mand such a large mar­ket share in Nor­way. Maybe we in New Zealand could be do­ing the same, so we can truly take ad­van­tage of the abun­dance of our clean en­ergy.

In per­cent­age terms there’s been spec­tac­u­lar growth in the num­ber of EVs in New Zealand – but in nu­mer­i­cal terms the EV fleet re­mains small.

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