A new report from KPMG Australia has shown how understanding localised uptake of EVs can help support fleet transition and improve carbon emissions management.
The report Accelerating local electric vehicle uptake where it matters, launching at the Infrastructure Sustainability Council Connect Conference Queensland this week, shines a light on the current uptake of Electric Vehicles (EVs) in key localities. It looks at car sales data and expected EV uptake in Sydney, Melbourne, and Brisbane at a local suburb level.
Report findings highlight that almost one fifth of Australia’s carbon emissions came from transportation-related activities. This means EVs represent a key pillar in the push towards decarbonisation with governments across Australia enacting measures to increase their adoption.
“Understanding EV uptake at a local level provides an opportunity for Australia to develop uptake policies and pathways that will help us go from EV laggard to EV leader,” said Ben Ellis KPMG Leader of Planning and Infrastructure Economics.
“A range of state-level targets have been set with Victoria, NSW and Queensland announcing a target of 50% by 2030. Better understanding adoption of EVs at a suburb level and also the trends in existing car model ownership and travel preferences can help in evaluating and responding to geographical diversity in EV and internal combustion engine car ownership. That in turn, feeds into a helping to achieve lower emissions outcomes.”
Ainsley Simpson, CEO of Infrastructure Sustainability Council said: “Zero Emission Vehicles have a key role to play in accelerating net zero for the transport sector, and for our nations, cities, and regions. A key objective of the Council’s work is to help deliver long-term social, environmental, and economic returns working with government and industry today. The KPMG analysis identifies that emissions reductions are a local matter, making it clear at the level of postcodes, where the greatest economic, social and environmental benefits can be gained.”
Urban Fleet Slope
In Sydney, Melbourne, and Brisbane there are clear trends regarding passenger car registrations and commuting patterns, including:
- As we move from the city centres to the outer suburbs, people prefer larger, more spacious cars.
- We tend to see cars that are older in the outer suburbs and relatively newer cars in the inner city.
KPMG’s Electric Vehicle Insights and Analytics Platform (EVIAP)
KPMG has developed the Electric Vehicle Insights and Analytics Platform (EVIAP) to track EV volumes at postcode level.
Mr Ellis said: “The EVIAP tool provides a valuable snapshot of the latest EV uptake trends and anticipates development of future EV fleet. It is capable of tracking EV technology, socio-economic trends and policy efficacy at a local level in our major cities.”
The EVIAP model estimates annualised EV registrations specific to each postcode in Sydney, Melbourne, and Brisbane. The model reflects the socio-economic characteristics of each postcode as well as the state of the technology at a given point of time. These results are further combined with generalised commuting patterns and vehicle replacement rates, allowing users to determine how the EV fleet is likely to develop.
Emissions Reduction Potential
“Using the KPMG Electric Vehicle Insights and Analytics Platform, we are able to forecast the likely reduction in CO2 from the uptake of EVs in each postcode based on typical commuting patterns,” said Mr Ellis.
“We find that emissions reductions are a local matter and that replacing a conventional vehicle with an EV in one area will not result in the same benefit as one in another.”
He said that current EV uptake trends suggest that rates will be highest in areas in the inner city with relatively shorter commuting distances; the emissions reduction benefits in this area will not be a great as the outer suburbs.
“This is where policies can be targeted to increase EV uptake to meet our emission reduction targets,” Mr Ellis said.
“If the current trends persist, emissions will be highest in areas with the slowest EV uptake. This will be a result of the current geographic distribution of cars across postcodes, where concentrations of older, emissions-intensive vehicles are clustered within outer suburban postcodes. In other words, replacing one conventional vehicle in an outer suburb could lead to much higher emissions reductions than replacing one in an inner city.”
Key Strategies to accelerate EV uptake
Mr Ellis said a range of market interventions could address this dilemma and promote EV uptake acceleration where it matters while alleviating some of the financial pressures of replacing a conventional car. A package of initiatives could include:
Ensure an adequate supply of EVs
EV import campaigns could ensure that (new) EVs desired by the Australian market are available. Adopting the Euro 6 vehicle emissions standards will also send a signal to the market to offer lower emissions vehicles to Australia, including EVs
Incentivise the uptake of affordable vehicles and model availability
Ongoing purchase incentives for lower priced vehicles and/or lower income households could help level the playing field and promote a more even uptake across metropolitan areas. Supporting the importation of vehicles that match driving preferences of each postcode will enable more choice for consumers.
Subsidise EV use for long commutes
EV commuting could be subsidised to make it more attractive than commuting in a conventional car. European policies could be considered as a reference point for this concept. For example, commuters in Austria are granted a fixed (income) tax exemption which increases based on the distance to the workplace and with the absence of public transport alternatives. In such a model, each kilometre exceeding a commute above an initial pre-set distance could be made (income) tax deductable for EVs. This could be implemented in a similar way as the ATO’s tax deduction for business-use vehicles.
“By addressing issues identified at the postcode level and addressing them strategically with tailored policies, Australia will be able to transition to an EV fleet more effectively and realise its emission reduction goals,” he said.