The government is tinkering with the Clean Car Standard - again - saying most importers are unable to meet the targets under the scheme as it currently stands.
It will also fully review the scheme, with recommendations to Cabinet due by June 2026.
The government last year watered down the standard to align CO₂ emissions standards with Australia - saying that change would strike the right balance between reducing transport emissions and ensuring vehicles would be affordable.
The standard charges importers for vehicles that have CO₂ emissions-to-weight ratios above a certain target, with credits for vehicles with ratios below that target.
Transport Minister Chris Bishop said it had helped lift fuel efficiency, but now the market conditions had changed, with a supply shortage of cleaner used vehicles, and a drop in demand for new EVs.
"Most importers are now unable to meet the passenger-vehicle targets. In fact, right now, 86 per cent of importers are facing a net charge rather than net savings from credits. The scheme is so out-of-whack with reality that even some hybrid vehicles will attract charges rather than credits," he said.
The Clean Car Discount scheme was announced by the previous government in June 2021. Photo: 123RF
The targets were set to decrease each year until 2029, while the charges for exceeding them would increase.
Under the new changes, the charges will be slashed by nearly 80 percent - from $67.50 to $15 per gram of CO₂ for new vehicles, and from a top rate of $33.75 to $7.50 for used vehicles, for 2026 and 2027.
Credits will also be protected so that none expire before 31 December 2028, while the standard is reviewed.
Bishop estimated the changes would avoid $264 million in net charges, which could have been passed onto consumers through higher vehicle prices.
The changes will made through an amendment paper to the Land Transport (Clean Vehicle Standard) Amendment Bill (No 2), with the aim of passing it this week and coming into effect on 1 January.
One of the first actions taken by the government upon coming into office was to repeal the Clean Car Discount, which charged fees to buyers of newly imported combustion engine vehicles, with the money going towards rebates for electric cars or plug-in hybrids.
ACC has also increased levies for electric cars.
- more to come
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