Labor’s push for electric cars fuels billion-dollar hole in road budget

LABOR’S plan to dramatically increase the number of electric cars in Australia could blow a $1 billion-a-year hole in the roadfunding budget within a decade – and five times that by 2039.

Bill Shorten revealed he would set a “national target” for half of all new cars sold in Australia to be electric by 2030 but offered no plan for tackling the major shortfall in fuel excise revenue that would create.

Motorists currently pay more than $20 of fuel excise per 50L tank of petrol or diesel, which raises nearly $12 billion for roads each year.

Electric cars contribute nothing. “Right now the people who are driving Teslas costing $150,000 to $200,000 aren’t paying for roads like the people who are driving a Mazda3,” said Infrastructure Partnerships Australia boss Adrian Dwyer. “There is no sense of the unfairness that currently exists,” Mr Dwyer said, because most owners of conventional cars were unaware they were already paying a road user charge. Bloomberg New Energy Finance last year estimated the rise of electric vehicles in Australia would cut $1 billion a year from fuel excise revenue by 2029 and $5 billion a year by 2039. It did not respond to requests for further comment yesterday. But its projections could be conservative.

The Bulletin has seen a 2017 Department of Infrastructure presentation that forecasts the loss could be as much as $3 billion a year.