The new bludgers on our roads
Rob Maetzig.
Let’s talk about petrol excise duty and road user charges – those fees that every motorist pays to help maintain our roads.
They’re going up. On September 30 the excise duty on petrol will rise 5.9 per cent to 72.4 cents a litre, and on October 1 the road user charge on dieselengined vehicles weighing less than 3.5 tonnes will also rise 5.9 per cent, to $68 per 1000 kilometres.
Oh – and by the way, these fees will rise again by the same percentages next year and the year after.
But that’s OK. It’s how we help pay for maintenance and improvements to New Zealand’s roads, and for other important initiatives such as public transport and road safety.
Of course, how much individual motorists pay in excise duty and RUCs depends on how much petrol they consume and how many kilometres owners of diesel vehicles travel. But given that in New Zealand the average light vehicle is estimated to travel about 14,000km a year, then it’s fair to assume that the annual duty/RUC cost per vehicle is around $1000.
That’s unless the car is a pure electric vehicle – because they don’t pay anything at all.
Obviously, pure EVs don’t consume any petrol, and the Government has exempted them from paying any RUCs. The bureaucrats say this is intended as one way of encouraging people to buy the vehicles.
This exemption will continue until 2021 or until EVs comprise 2 per cent of our light vehicle fleet, whichever comes first.
Energy and Resources Minister Megan Woods and Acting Associate Transport Minister James Shaw have jointly boasted that there are now 10,000 EVs on our roads.
Shaw added that this was an important milestone, particularly considering that just five years ago there was only 210 EVs registered.
Some of that ‘‘EV’’ number includes plug-in hybrids, of course, but there are still more than 7000 new and used-import pure EVs registered in New Zealand.
It is an important milestone, too. EVs emit at least 80 per cent fewer emissions than their fossil fuel equivalents, and a lot more of them will be needed if New Zealand is to meet its greenhouse gas target under the Paris Agreement of reducing emissions by 30 per cent below 2005 levels by 2030.
But is it fair that this growing fleet of electric vehicles should be contributing nothing towards meeting the cost of the wear and tear they are causing to New Zealand’s roading network?
Now that the EV fleet has reached 10,000 cars, and at the current RUC rate, the National Land Transport Fund is missing out on at least $7 million a year from battery-only vehicles. But they’re out there using our roads, which is something that could be said to be totally removed from the climate change good they are achieving.
And consider this. If our EV population continues to grow at such a rate that it reaches the 2 per cent of our light vehicle fleet before 2021, that will mean they will be bludging even more from our highway maintenance operation.
In its excellent report into how New Zealand can best transition to a low-emissions economy, the Productivity Commission heaped praise on the huge potential of the EV in helping meet this aim.
It pointed out that if New Zealand’s entire light vehicle fleet was replaced with EVs right now, our annual CO2 emissions would fall by 11 million tonnes.
The report added there are currently three major barriers to the uptake of EVs: the high upfront cost of buying the vehicles, their limited range, and a lack of public awareness and understanding.
No mention was made as to whether any exemption from paying RUCs might factor into any EV purchasing decision.
With that in mind, now that the 10,000-vehicle mark has been reached, is it really appropriate that so many owners are being allowed to continue to pocket the millions of dollars that could be going into much-needed improvements to the roads they drive on?