Parties lock horns on cost of emissions

National says a new standard for emissions in cars is going to make the price of cars go up. The Government says it will mean electric vehicles will be cheaper – and they both have the papers to prove it.

National’s transport spokesman Michael Woodhouse and Transport Minister Michael Wood locked horns over the new clean car standard.

Woodhouse’s weapon of choice was a policy paper from last year, that warned new standards will increase the cost of importing vehicles.

Wood shot back with a more current paper that argues the cost of electric vehicles and hybrids is likely to decrease.

The Government has two policies to green the vehicle fleet. The clean car discount charges people who buy dirty vehicles to offer a subsidy to people who purchase cleaner vehicles.

The second, lesser known policy, is the clean car standard. This works by setting suppliers an emissions target to reach. Suppliers must make sure that they don’t import vehicles which emit over a certain threshold – if the average emissions of their fleet are over that threshold, they will be hit with a fee.

Suppliers could avoid that fee by lowering the average emissions of the cars they imported.

An early version of the Government’s clean car standard warned it could increase the cost of some small EVs by as much as $40,000. Wood has since made changes to the scheme to avoid enormous costs like that. A regulatory impact assessment now has the cost of a new EV falling from about $58,000 in 2019, to $47,000 in 2025.

On the back of that advice, Wood made changes to the standard, which he’s confident will prevent those costs from being passed through to consumers.

Woodhouse believed those increased costs, if there are any, will be carried by consumers.

‘‘No amount of spinning by the prime minister or the minister of transport will change the reality that a large number of people with very few choices will be paying significantly more for the vehicles they need in the future,’’ Woodhouse said.

Wood said the emissions standard ‘‘will result in average fuel savings for families of nearly $7000 over the lifetime of their vehicles and stop over 3 million tonnes of climate pollution going into our atmosphere’’.

The first target is to have new vehicles emitting just 105 grams of CO2 per kilometre in 2025.

But a briefing to Wood from November warned that pushing ahead with the 2025 target, though technically possible, would be ‘‘extremely difficult’’.

‘‘To achieve this, vehicle suppliers will have to either almost exclusively sell hybrid vehicles, or sell a large proportion of EVs. This will be extremely difficult for them to do over four years, because New Zealand is not a priority market for overseas vehicle manufacturers.’’

As a result of those difficulties, the changes would ‘‘disrupt vehicle supply in the short term, push up vehicle prices, and slow the turnover of the existing fleet,’’ the paper warned.