Will the proposed fuel efficiency standards save you money?
If the Albanese government gets its way, Australia will introduce a set of fuel efficiency standards next year that aims to reduce emissions of new cars, SUVs and utes by 60% by the end of the decade.
Dubbed the New Vehicle Efficiency Standard (NVES), it's primarily shaped around environmental concerns, but with vehicle emissions generally scaling in direct proportion to their fuel consumption the government claims the NVES will have the happy side-effect of reducing household expenses by an average of $1000 per year, or $17,000 over the life of a vehicle.
But will it?
The answer is a firm, "it depends".
Of course, if your plan is to just hold onto your existing car for the foreseeable, then the proposed legislation will have no effect on your fuel bills.
Rather, the legislation aims to compel automakers to bring their most efficient vehicles to Australia - or at the very least increase the availability of low-emissions options within their existing vehicle lineup - with compliance to be measured by the grams-per-kilometre emissions of CO2 of each car.
Not all cars will fall under the NVES CO2 threshold and the legislation won't outright force automakers to sell lower-emissions cars, but those that do will earn a credit for each emissions-compliant car sold that year.
Conversely if they sell a car that's non-compliant, that company earns a debit.
If there's a surplus of credits, that manufacturer can sell those credits to manufacturers that have a more debit-heavy emissions ledger, with the end goal being a long-term reduction in automotive-sector CO2 emissions.
But you'll only save money as a direct result of the NVES if you buy a new car that's more efficient than your old one, and which wasn't available prior to the introduction of the NVES. Even then, those savings won't manifest until you've driven it long enough to see your average fuel usage fall markedly.
From a consumer's point of view, the biggest benefit should come in the form of greater variety and availability of efficient vehicles, because the government's claim that Australians will financially benefit from the NVES is rather misleading - to save money, you're going to have to spend money first.
The New Vehicle Efficiency Standard will, if passed, go into effect on January 1, 2025.
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