9 Jun 2021

How to cut NZ's transport emissions? Driving industry boss, climate change expert respond

From Checkpoint, 6:12 pm on 9 June 2021

The final report from the Climate Change Commission has been released, with a key recommendation being a ban on the import of fossil-fuel-powered vehicles from the early 2030s.

Transport creates about 47 percent of New Zealand's carbon emissions, and from 1990 to 2018, domestic transport emissions increased by 90 percent.

Motor Trade Association chief executive Craig Pomare told Checkpoint a ban on new petrol or diesel-fuelled imports would be a step too far. He wanted to see incentives to deal with the existing 5.5 million vehicles on New Zealand roads.

Professor Dave Frame from the NZ Climate Change Research Institute said there needed to be more complex work done to make lower carbon options more attractive without disproportionately impacting lower socio-economic groups.

"If the endgame is to decarbonise the fleet, there are better ways to incentivise Kiwis to get into cars that do spew out less emissions, whether that's an EV, whether that's a hybrid, whether that's a petrol and diesel vehicle that has lower emissions than what we have now," Pomare said.

"The challenge we've got is that everything in the [Climate Change Commission] plan is focused on the cars that come into the country every year, which is about a 250,000 to 300,000. But actually, if we dealt with the 5.5 million vehicles in the country right now then we could actually achieve that target far sooner by making sure they're maintained, and doing emissions testing on them.

"It's not about shifting it to somebody else, we can actually take care of it ourselves. But the plan makes absolutely no mention of the existing fleet of vehicles."

Pomare said he had talked with the Minister of Transport about the idea of scrappage, where people are reimbursed for trading in their older, higher-emitting vehicles. He said there was interest expressed from officials, but he does not see any recommendation like that in the Climate Change Commission report.

He would like to see vehicles 15 years or older in a scrapping scheme.

"We're saying 'let's get the worst ones off the road at around 15 years', it then means we can open the door to some better, lower polluting, far safer cars."

Just under one in three cars on New Zealand roads are 15 years or older, Pomare said.

He suggested a range of reimbursement options, including cash in hand, credit towards a more efficient vehicle, or credit on one's public transport account.

Pomare said another challenge was electric vehicle (EV) supply.

"In Japan there's something like less than 200,000 used EVs, versus multiple millions of hybrid vehicles.

"Right now if we think it's EVs and EVs only, that will get us to the 2029 target? We just don't believe that's realistic."

In terms of trucks for commercial or industrial use, Pomare said there were some companies trialling electric trucks in New Zealand. For some there were practical challenges like charging times.

'NZers drive some pretty unnecessarily big vehicles' - Professor Dave Frame

Professor Dave Frame, Director of the New Zealand Climate Change Research Institute at Victoria University, told Checkpoint there needed to be more cross-policy work from government to make lower carbon options more attractive, without disproportionately impacting lower socio-economic groups.

"Transport is a hard sector but it's an important sector and, politically, it's a tricky sector because there's so many motorists," Professor Frame told Checkpoint.

"So putting fuel surcharges in place or lifting the price of petrol is a proven vote loser, so it's actually quite a hard sector to make much progress in.

"I think by trying to make public transport much more attractive by investing more in it, by trying to get stuff onto the rail network, they have some potentially positive things to do, but they will need at some point to be disincentivising petrol car use as well.

"Otherwise the ban in 2030 is not so credible. That ban will only stick if petrol vehicles are fairly unattractive at that point.

"Our vehicle fleet is one of the oldest in the OECD because, largely, we buy second-hand vehicles from overseas. If we continue to do that, then we would need a generation of vehicles to pass through that we buy second-hand.

"So it's a very short turnaround and either implies quite large subsidies to pull those vehicles through or major technological changes so those vehicles are being produced much more cheaply than today.

"That's possible, but it's sort of unproven."

The Climate Change Commission's report estimates there will be price parity between an EV and petrol car by about 2031.

"There may be," Professor Frame said, "but the further you gaze out into the distance, the trickier it is.

"If they're right about that, then that may well be an attractive thing to do. But if you look at the long tail of vehicles in New Zealand, we have an abnormally high number of vehicles that are over 15 years old.

"That price parity in 2031 doesn't necessarily translate into the New Zealand road fleet being low carbon by 2035."

The report also recommends the number of kilometres travelled by cycling to triple, and the number of kilometres travelled on public transport to double.

To achieve that, Professor Frame said there needed to be more driving disincentives.

"If it's much more expensive to drive a vehicle, people probably will choose alternatives. Whether they're happy doing so is a different matter."

He would recommend vehicle emissions testing and a fuel surcharge to more closely reflect the actual price of carbon on a vehicle's CO2 emissions.

"Modelling we did last year suggested that to make the cuts that you want from the transport sector by 2030, under the old climate target, [you would have to] add another dollar for the petrol price.

"I don't think that would work, but I think some sort of emissions-based surcharge on fuel would be a good thing. I wouldn't suggest going all the way up to $1 because I just don't think it would stick, but I would suggest something in that area to disincentivise the use of petrol cars. New Zealanders drive some pretty unnecessarily big vehicles.

"But I would also do things with a tax and benefit system because, simply, a fuel surcharge would hurt poorer people disproportionately.

"The vision in this document is a transformational change. Yet many of the areas in it - the discussions are about things like a massive scaling up of cycling and active transport and public transport. But how are we going to get there?

"That's where it's a coupling between policies and making the low carbon option more attractive, that it's really all about. And there I just don't think that a small commission with a universal mandate is able to do all that joining up, because it doesn't really have complete line of sight over any one sector, let alone all of them interacting together."