- Read Zephyr's previous columns in this series, 'Could EVs be the key to super commuting? Here's how I found driving the Hyundai Kona EV for a week' here, and 'Are you worried about range anxiety in an EV? Here's why it’s all in the mind' here.
The first step on the path to beating addiction is recognising you have a problem.
Thanks to our falling dollar, New Zealand has a trade deficit of $4 billion (the worst in a decade) and currently spends $6.5 billion a year importing oil. We’re in the ridiculous situation of exporting all our oil and importing someone else’s. New Zealand’s oil is just too good for the local market. Our single refinery at Marsden point cannot refine our own oil. That does nothing to help our energy security. We’re not producing enough to be independent, but it’d be nice not to have to ship ours to Australia and import more from the Middle East. It seems we have an issue with long-term planning and the costs involved. Marsden point was built in the 60’s and we had two chances to fix our energy security when it was upgraded in the 80’s and 2009. Unfortunately, the country was bankrupt in the 80's and the Global Financial Crisis had happened in 2008. Looks like we are stuck with importing the black stuff until we sort ourselves out.
Rising fuel costs hurt a lot of people. It will increase the cost of everything: a rising tide raises all boats. Unfortunately, there are many people who simply can’t afford extra expenses, they are living on the edge as it is, their boats have short moorings and a rising tide will flood them. Reducing our reliance on oil is a win for everyone, except oil companies, but we still have people protesting about lowering prices and keeping us hooked on the stuff.
Lowering the cost of the drug is not the answer to fixing an addiction, we must provide an alternative.
Are electric vehicles a real alternative?
With the rise in petrol prices, there has been a lot of press about EVs recently. EVs are quite mainstream now, but they are still largely off most people's radar. Nobody is surprised to see a Nissan Leaf driving around town, first released in 2010 there are now thousands of them imported and sold in New Zealand every year. In fact, there are 25 models of full Battery Electric Vehicle (BEV) or Plug-in Hybrid Electric Vehicle (PHEV) in New Zealand. It’s limited, but it’s improving. There have been over 4000 EV registrations already in 2018. That’s more than all of 2017 in nine months. It’s 1600 more than the total registrations in the four years from 2013 to 2016.
Petrol prices are probably contributing, but looking at the EV community, it’s a pretty mixed bunch of people. There are the geeks who like new tech, some are environmentalists who want to reduce their carbon footprint, some are converted petrol heads who want superfast cars. Many just want to reduce their petrol bills, and most are a mixture of all these things.
There does seem to be a lack of low-income families in the EV owner demographic. This is mainly due to the lack of affordable family-friendly models and the higher upfront cost. Like long-term planning and investment in infrastructure (Marsden point as an example) people don’t like to pay more now to save later. Unfortunately, EVs are pretty much a pay now, save later proposition. That’s okay if you are a homeowner and can get cheap finance. But if you are a renter on a low-income, that’s not so doable. If the government wants low-income families to transition into sustainable, cheap running cost transport, it’ll need to help them overcome that barrier. I’m not talking a direct subsidy to lower the cost, more like cheap finance loans for sustainable solutions. It could be EVs, but it could also be home solar and battery packages.
The imported Nissan Leafs are the most popular BEVs (battery electric vehicles), partly because Kiwis love buying cheap used vehicles from Japan, but also because of the lack of choice of New Zealand new models. Up until this year, you only really had a choice of the Hyundai Ioniq or BMW i3 for New Zealand new BEVs. Apparently, you could also buy a Renault Zoe EV or Kangoo EV, but you’d need good luck finding one of those at a Renault dealer. Nissan stopped selling New Zealand new Leafs a few years ago, despite (or maybe because of) the popularity of them being imported. They have put up the 2019 Leaf on their New Zealand website (although the registration of interest form didn’t work) so it looks like they have finally had a change of heart. The PHEVs (plug-in hybrid electric vehicles) are a lot more popular, with the standouts being Mitsubishi Outlander PHEV, Kia Niro PHEV and Toyota Prius PHEV.
Nissan Leafs charging.
After eight years, the verdict is in on the Leaf, they are the most reliable car on New Zealand roads. They were top last year and second this year in Consumer NZ's survey. An astounding 98% of owners are very satisfied, and they are getting more satisfied each time they pass a gas station. As the years go by, I think more EVs will be joining the Leaf on the top of these lists. EVs are simple, there is no engine or transmission to go wrong. Maintenance on the Hyundai Kona is a $125 check every 15000km. A change of an air filter, a rotation of the tyres and check of the brake fluid (those brakes you hardly use) and you’re done for another year.
New Zealand has 80% renewable energy, and that’s without really trying. It is the perfect environment for EVs.
Don’t listen to naysayers who talk about burning coal to run EVs, that does not happen in New Zealand. We burn coal and gas mostly for industry (like drying milk powder). New Zealand does have a lot of coal and gas to burn, but we also have a lot of waste going to landfill and our recycling is piling up. We have a lot of forestry waste, too. Maybe we should look at stopping drilling and dumping, and start burning for industrial energy. Sweden has incinerators in cities, they are not toxic. It’s not a whole solution, but it could be part of one, and nobody likes landfills in their backyard.
You can also ignore those saying the grid can’t take all those cars coming home and plugging in. Smart EV owners time when they charge their EV to take advantage of the best rates. You put a timer on the charger. You don’t hit the grid in peak time. You can usually set up 'allowed’ charging times in the system of the car.
There are also people who say we don’t have enough capacity, they are talking rubbish. Look up into the sky at noon, raise your hands into the air and feel the breeze, there is plenty of capacity we can tap into. There is also the fact that 14% of our electricity is used by a smelter in the south, which has a limited lifespan.
So, we know that EVs are great, and good for New Zealand, but who is helping us to make the change?
Unfortunately, we can’t count on the manufacturers to do it.
Before 2018, outside of Hyundai and BMW, none of the other manufacturers really supported BEVs in New Zealand. Consumer range anxiety around BEVs, the wider range of PHEV options, and especially the love of SUVs and (cheap diesel burning, fringe benefit tax-exempt) utes, made sure of it. Manufacturers don’t have BEVs in the two most popular vehicle market segments, which are SUVs and utes. Those two segments make up 66% of the market. The arrival of Tesla in New Zealand with the Model X SUV changed that a little bit, but that’s a very small market here, not many can afford $138,000 for a car. In the US, Tesla Model 3s are selling like hotcakes (number four on the sales charts – outselling the Corolla), but it's probably going to be a year or so before we get those here, and they’ll still be expensive. VW New Zealand also started selling the e-Golf, which is very popular in Europe. Jaguar (the Indian-owned 'British' car manufacturer) will release the i-Pace at some stage soon.
Clean EVs can’t use priority lanes, but dirty, smoke-belching trucks can. We really need to rethink our priorities.
New Zealand is a very small part of a limited right-hand drive market. Since the UK and Australia stopped producing cars we only have Japan, Thailand and Indian manufacturers making right-hand drive cars – everyone else has to convert them. Indian manufacturers aren't really interested in New Zealand (outside of the Jaguar i-Pace and Range Rover PHEV). Only Mahindra is selling here. The biggest manufacturer of EVs is China, and they are busy supplying left-hand drive cars in their own market.
Three of the top five BEV brands are Chinese. Heard of BYD, BAIC and SAIC? No? That’s because they have next to no presence in New Zealand. SAIC has brought in some LDV EV vans, but that’s about it. Tesla is tiny in New Zealand, or rather New Zealand is tiny for Tesla. They are selling well for luxury cars, but they are still luxury cars. Maybe some billionaires will store a heap of them in their underground bunkers. Nissan does not even bring in Leafs, we have to import them used, with no manufacturer warranty. Any company up for buying cars without a manufacturer warranty?
The government and transport agencies haven’t really helped, either.
The previous Government did virtually nothing to incentivise personal EV uptake, and the current government has done nothing (yet) to improve that. The target of 64,000 vehicles (2% of the market) by the end of 2021 was weak and unambitious. New Zealand will hit that without incentives, it is a ‘do nothing’ target. The most recent statements made by the coalition government show the focus for incentives, when they do finally get announced, will be for government and business uptake. Currently, the only real incentive for private EV owners is an exemption from Road User Charge (RUC) and that ends in December 2021. It’s been said by some that that RUC exemption makes EV owners bludgers.
There is an alternative case to be made that, since there are no emissions levies on ICE (regular) vehicles, every car ICE owner is bludging off paying for the health costs from those emissions. Emissions cause lots of health issues. Those costs are being covered by regular taxpayers, rather than the dirty diesel and petrol burners that are causing the problem. The argument then goes “You can’t do that, it’ll increase the cost of freight!” – polluter pays, I reckon.
Why should the public pick up the cost for the freight industry? We’re already heavily subsidising maintaining the roads for the damage trucks do. And speaking of incentives, how is it that heavy trucks get to use the priority lanes for motorway on ramps? It’s because, if they sat in the regular lanes, the regular commuters would be left sucking on their fumes. NZTA is actually incentivising freight by letting them use a priority lane. That’s the same NZTA that just canned the trial of the same incentive the last National government tried to give to EVs. Clean EVs can’t use priority lanes, but dirty, smoke-belching trucks can. We really need to rethink our priorities. How about for a start, they clean up their act and stop using smoke -belching vehicles – or pay heavily for doing it, rather than get a free 'priority' pass? Smokers are made to pay heavily and go to their own little area outside, not given VIP treatment.
Jacinda Ardern has called climate change this generation's “nuclear-free” moment. The coalition government has set up a climate commission, set a zero-carbon target for 2050, but it’s doing nothing to help those on lower incomes kick the petroleum habit. The IPCC has released its damning report, the change has to start now. From the limited announcements so far, the incentives will largely be aimed at businesses. Fringe Benefit Tax (FBT) and depreciation changes might go a little way to stop businesses buying utes as company cars. There are currently 65 double-cab utes brought for every EV. At least it’ll allow EVs to be an option on fleet managers' purchasing list, rather than being costed out by the high purchase price and therefore higher FBT rates. Removing the FBT work related exemption for utes would help too – let us just stop subsidising utes. We need to start costing in emissions and use that to reduce the cost of cleaner imports. The current form of proposed feebates is revenue neutral, that’s not going to work for low-income families that need these cars the most. We need to increase their subsidies by actively helping them scrap their petrol-dependent vehicle.
PHEVs and BEVs are not the whole solution, but they are a big part of it. Hydrogen will probably be required for heavy transport, buses and maybe even planes and ships. We’ll need to invest in cheap hydrogen production for that to happen. Current industrial production methods are very dirty. We’ll need it to be run off local renewable production methods. It’s not as efficient as a BEV, but it does not have the problem of weight and distance, which are big issues for heavy industry. A giant battery in a truck will take a very long time to charge, that’s not good for the business running the truck.
Lastly, the government needs to signal manufacturers that we’re EV friendly, so that they actively market the EVs they produce. I guess that’s where converting the government fleet comes in, maybe talk of a big contract for Nissan has nudged them to begin selling New Zealand new Leafs again. I’m not sure that is how I want my tax money spent. Those cars might filter down to low-income families in 10 years, but those families are hurting now. Some hard regulations about manufacturers having to sell zero-emission vehicles would be handy, it certainly works in California. Apparently, China is producing lots of family-friendly EV people movers as taxis, so let's encourage them to sell us some. The good news is that Thailand (the Detroit of the East) has a friendlier EV policy than New Zealand, and they happen to drive on the same side of the road. Do I see a door for cheap Chinese EV imports opening? Fingers crossed they can pass the safety and compliance standards.
EVs don’t need to be feature-packed, high-end, luxury vehicles. They just need to be able to transport people cleanly, safely and cheaply.
This year, we’ve had 2000 vehicles abandoned in Auckland. They are simply getting too expensive to run. If other countries make the switch to EVs before us, they will be looking to dump their ICE vehicles somewhere. We’ll need emissions and import standards to stop New Zealand being that dump.
Breaking any addiction is hard work. We all need to work together and support those making the change, rather than standing on the sideline barracking them. Accept the things we cannot change (yet), but definitely change the things we can.
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