Driving towards Australia’s energy transition
The Green Files is a unique CEFC series where we talk to the people making a difference in the race to net zero emissions.
With more models coming onto the market, more Australians are making the switch to electric vehicles (EVs). EVs not only provide a way to reduce emissions and cut carbon footprints, they also offer additional benefits ahead of traditional Internal Combustion Engines (ICEs). Thang Tran, CEFC Investment Director and avid EV fan, discusses these advantages and talks about where the EV market in Australia is heading.
Just a few years ago, you’d struggle to see an EV regularly on Australian roads. Fast forward to today, and the EV revolution is in full swing. Around 91,000 full battery EVs were sold in Australia in 2024 – almost triple the 33,410 sold in 20221, with EVs accounting for almost 10 per cent of all new cars sold.2
In 2023, I became one of the thousands of Australians who’ve made the switch to an EV, and my family and I have reaped the benefits since.
I’ve been pleasantly surprised by the convenience of owning an EV. I’m lucky enough to have off-street parking and rooftop solar, and I make the most of the free charging offered by local councils when I’m out and about. All up, the cost of powering my EV has been less than $100 a year. Shopping centres and local councils have dedicated parking spots for EV drivers, making it much easier to find a place to park.
I’m also enjoying the high-tech features with added safety and security. I particularly like security mode, where my EV monitors the environment when parked, and take videos of any close-encounters or dangerous situations. Plus, it’s whisper quiet, making it an all-round pleasure to drive.
And most importantly, I’m glad to know that in driving an EV I’m supporting Australia’s transition towards net zero emissions.
While the transition towards greater EV uptake hasn’t been without challenges, the increase in supply and choice of EV models means that EVs are increasingly available at a range of price points. Once a luxury option, new EVs can now be purchased from around $30,000, meaning that more people can get on the road and reduce their emissions for less.
There’s been a significant level of growth in the range of brands are available, with carmakers from China and other markets putting their latest models into the Australian market.
Reducing range anxiety
A big factor in increased EV uptake is the reduction in “range anxiety” amongst drivers, who feared they would run out of power on long trips. The average distance travelled daily by most Australians equates to just over 33km3 per day, which is easily covered even by vehicles without longer ranges. Some longer range EVs – as much as 600km – are further helping to alleviate these concerns.
The continued build out of rapid chargers on Australia’s highways will help more consumers overcome the range anxiety that has been holding back some motorists from making the switch. EV drivers are getting used to planning their charging stops when they’re on longer trips and often their cars can help them do this.
More chargers in apartment blocks
There are still a few barriers to overcome on the way to increased EV adoption. One is installing chargers into older apartment blocks, which often don’t have the right electricity infrastructure and whose strata managers can be resistant to accommodating chargers. All levels of government are working with the property sector to find a way through the problem.
For new apartments it’s not an issue, with the National Construction Code requiring that new parking spaces for apartment buildings include space for switchboards and to be capable of supporting EV charging infrastructure. Additionally, 10 per cent of parking spaces in new office and retail developments must be EV ready, as must 20 per cent of parking spaces in all other commercial developments4.
EVs are essential to the transition
The widespread adoption of EVs will play a crucial role in Australia’s energy transition.
Transport emissions currently make up about 22 per cent of Australia’s total emissions, which is forecast to rise to 27 per cent in 2030. Of that, emissions from passenger vehicles and light commercial vehicles make up 55 per cent.
All up, in 2030, passenger vehicles are expected to make up around 10 per cent of Australia’s total emissions, with light commercial vehicles projected to make up almost 5 per cent. Transitioning them to EVs will be crucial in reaching our climate targets5.
Boosting energy security
It’s important to note that EVs that are charged from the electricity grid – as opposed to rooftop solar – aren’t emissions-free. If the power used to charge them is generated by burning coal, for example, then driving an EV will produce emissions, but just at the power plant instead of at the car itself.
However, as more and more of Australia’s electricity is generated from renewable sources, EVs will become increasingly low emissions and eventually emissions free.
Another future benefit of EVs is energy security. A new generation of EVs allows the EV battery to be used as a power storage. Households can draw on that power for home use such as powering lights, televisions and other devices, essentially using the car battery as home energy storage. Recently in Queensland vehicle-to-load technology was utilised by EV owners during and after Cyclone Alfred to keep appliances and lights working, an example of how energy storage can provide additional resilience in tough times6.
For many motorists the cost of purchasing an EV remains a barrier to faster uptake. That’s where the CEFC is stepping in to help overcome this challenge by working with car makers and lenders to provide discounted finance for consumers and businesses purchasing an EV.
For example, we’re making EVs more accessible to more people with a $150 million commitment to support the Commonwealth Bank of Australia EV Access Program that provides discounted loans to buy EVs to essential workers and low-income Australians. Car manufacturers have also come onboard to the program to provide benefits such as reduced upfront costs or free EV charging subscriptions.
On the supply side, the CEFC is working to bring more EV options onto the market. For instance, we’re investing up to $50 million with Australia’s largest independent retail auto financier Angle Auto Finance by providing finance to car dealers to change their showroom floor plan to accommodate EVs.
There’s little doubt that EV sales will continue to grow in 2025 and beyond as prices come down further and new entrants, particularly from China, further increase consumer choice. We’re seeing people mover and ute EVs are becoming available, and the market looks set for continued strong growth.
EVs significantly reduce carbon emissions, improve air quality and support energy security. They’re a tangible way for individuals to make a difference to the pressing need to lower emissions. They’re also a lot of fun to drive! I’m confident there’ll be many more motorists joining me on the road in their EVs in the years ahead.
1 (https://www.aaa.asn.au/library/electric-vehicle-index-q4-2023/ and https://electricvehiclecouncil.com.au/uncategorized/2024-sets-new-record-for-ev-sales-in-australia/)
2 Electric Vehicle Council, State of Electric Vehicles 2024, p9.
3 Based on an average of 12.1km annually, https://www.abs.gov.au/statistics/industry/tourism-and-transport/survey-motor-vehicle-use-australia/latest-release
4 https://councilmagazine.com.au/understanding-new-ev-charger-requirements/
5 https://www.dcceew.gov.au/climate-change/publications/australias-emissions-projections-2024
