Clean Car Standard scheme questions and answers

Do many imported electric vehicles have low star safety ratings?

No. The Nissan Leaf is the most common electric vehicle and all models back to 2012 have been 4-star vehicles. Like all vehicles there are always less safe models and we recommend using www.rightcar.co.nz(external link) to help buyers choose the safest car they can afford.

If petrol vehicles incur fuel excise duty (FED) and diesel vehicles incur road user charges (RUC), how will electric vehicles contribute to the Land Transport Fund?

Electric vehicles make up a very small portion of road users. They are not subject to FED as they do not require fuel and are currently exempt from RUC to encourage further uptake of electric vehicles. The current exemption is in place until 31 December 2021 but may be extended. Once it is lifted, electric vehicles will need to pay RUC based on distance travelled. The revenue mechanisms to fund the transport network will require further analysis over time. This is not part of the scope of the Clean Car scheme but is being addressed by the Ministry of Transport (MoT) and Waka Kotahi.

If electric vehicles do not contribute to the Land Transport Fund, does that mean less money will be available and that our roads will therefore be less safe?

While the volumes of electric vehicles are low there will be no difference made to roading investments. Over time consideration will be needed on the best manner to recalibrate the revenue mechanisms that fund the transport network.

Are electric vehicles generally more expensive than similar non-electric vehicles?

Yes, they tend to be. That is why the Government is considering an incentive scheme to help make clean cars more affordable.

Will the Clean Car Standard make used imported vehicles more expensive for low-income families?

With current market prices the initial purchase price may be higher. However, the ongoing running costs of low-emission vehicles can be significantly lower. The Standard is expected to result in fuel savings for families of nearly $7000 on average over the lifetime of a vehicle. This will benefit lower-income households because they spend a higher proportion of their disposable income on fuel.

What financial encouragement will there be to buy electric vehicles?

The Government has signalled that it intends to consider introducing an incentive scheme for clean car buyers. It is expected to be similar to the Feebate scheme consulted on in 2019.

What is a Feebate?

Feebate is a made-up word joining the words Fee and Rebate. A feebate scheme (more often called a discount or a rebate scheme) would charge a car buyer a fee for a high-emitting vehicle and provide a rebate/refund for a clean car.

If there are to be discounts for buying electric vehicles, how long will they last?

Details of an incentive scheme have yet to be announced. The scheme consulted on in 2019 anticipated discount incentives to be in place for several years, with review periods allowed for.

How much will the Clean Car Standard cost to setup and administer?

Implementing the Standard will require $16.2 million in capital cost, and $7.2 million to administer annually.

What else is the Government doing to reduce transport emissions?

This is just one part of the Government’s plans to decarbonise the transport sector. Officials are currently developing a Transport Emissions Action Plan. This will be our plan for how New Zealand could reduce its transport emissions and will be the basis of the transport section in the Government’s Emissions Reduction Plan for the 2022–25 emissions budget. The Government has signalled it intends to implement a lower emitting bio-blend fuel and have councils electrify the public bus fleet.

What are the Government’s new CO₂ standards?

The standards change progressively each year, lowering with the expected technology advancement and sector adoption. The benchmark for the standard is 2025, when to not incur fees, vans, utes and light trucks will need to meet 132 grams of CO₂ per km, and cars and SUVs 102 grams. Those targets should result in an average CO₂ level being achieved across the light vehicle fleet of 105 grams. The measures are based on the New European Drive Cycle (NEDC) standard.

How are they measured?

All manufacturers produce the emissions rating for each vehicle model when it is introduced. It is produced according to specific criteria. There are several different CO₂ standards used internationally and NZ will have a standard calculation converting them to a common equivalent.

What percentage of New Zealand’s greenhouse gas emissions are the result of transport emissions?

47%. Of this percentage, nearly 70% of all transport emissions are from cars, SUVs, utes, vans and light trucks.

How does New Zealand compare with other OECD countries with regard to CO₂ standards?

New Zealand is one of only three countries in the OECD without a regulated vehicle CO₂ standard. The others are Australia and Russia. The target of 105g we are setting for 2025 was already achieved by Japan in 2014 and by Europe in 2020.

Will there be any exemptions to the Clean Car Standard?

 Exemptions to the Clean Car Standard are proposed for:

• agricultural vehicles for farms, such as tractors, harvesters, mowers, toppers, bailers
• military vehicles
• special interest vehicles
• vintage and veteran vehicles 
• scratch built vehicles and modified vehicles certified by the Low Volume Vehicle Technical Association.

What percentage of current New Zealand vehicle registrations are electric?

In December 2020, there were 24,862 electric vehicles on New Zealand roads - 2% of vehicle registrations in New Zealand. This compares to 87% in Norway and 23% in the United Kingdom.

What plans are in place to ensure heavy vehicles, such as buses and trucks, also go the electronic way?

The technology is also advancing in those transport sectors. Already the Government has signalled a full conversion of the public bus fleet. Over time we can expect to see more adoption in those areas.

What are the charges for importers who continue to import vehicles that have a high CO₂ rating?

There are different rates for new vehicles and used vehicles, and different rates depending on whether charges are paid annually or as you go. Also, the charges increase after the first two years. All charges are amounts per gram of CO₂ over the importer’s target.

Will the Clean Car scheme mean car stock will be more expensive for importers?

This will be up to the importer, who has the option of importing clean cars and not incurring any fees. Importing vehicles with CO2 emissions below their targets would accrue credits that can be used to offset potential charges from vehicles that exceed their targets.

Is it feasible to have the Clean Car scheme operational by 1 January 2023?

Absolutely. We already have many of the elements needed for the scheme to operate. Waka Kotahi has commenced work on this initiative, and you can expect to see and hear more about it as we go.

What is the MoT’s role in the implementation of the Clean Car Standard?

The MoT is responsible for advising the Government on the policy settings and outcomes. It has a role to review the scheme and propose adjustments as necessary to achieve the outcomes the Government is seeking.