Victoria announces $3K EV subsidy in huge electric vehicle push

Premier Daniel Andrews has set a target to make half of all vehicles zero emissions by 2030, as Victoria announces a $3k EV subsidy – the centrepiece of a $100m package that will see it leading the charge to a zero-emissions future.

The government says the package will both encourage the uptake of EVs and improve charging infrastructure across Victoria, promising the moves “will encourage more drivers to consider purchasing a zero-emissions vehicle”.

“The science is clear. Our transport sector is a significant contributor to our emissions. This package of reforms is makes cars the vehicle for change, by getting more zero emissions vehicles on our roads,” says Victorian Minister for Energy, Environment and Climate Change, Lily D’Ambrosio.

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Victoria announces a $3000 EV subsidy even as the state looks to push a controversial electric car road user tax through parliament, which would see a 2.5c per kilometre fee charged to EV owners. That plan has attracted the ire of the auto industry and climate change experts alike.

In announcing the package the Victorian government said the per-kilometre road user tax would help fund the $100 million zero emissions package that will see the formation of an “expert advisory panel”.

The $100 million package includes $46 million in direct EV incentives, $19 million in additional infrastructure, $10 million to buy zero emissions vehicles for the Victorian fleet and a $5 million “innovation fund” to encourage the uptake of EVs in the commercial vehicle sector.

If successful the unprecedented EV incentive package could significantly increase the update of electric vehicles in Victoria, which until now has had one of the lowest EV take ups in Australia.

The subsidy is aimed at EVs costing less than $68,740 (before on-road costs such as stamp duty and registration), which currently includes only a handful of models such as the MG ZS EV, Hyundai Ioniq Electric, Nissan Leaf and Leaf e+ and the most affordable version of the Tesla Model 3. It should also include the yet-to-be-priced Hyundai Ioniq 5, Kia EV6, Toyota bZ4X and Mazda MX-30 Electric.

The subsidy will be available for the first 20,000 electric vehicle purchases from today, and will roll out in stages. The $3000 subsidy will apply to the first 4000 EVs sold, with the level of discounting applied to the next 16,000 vehicles yet to be confirmed. However, given the initial numbers spruiked by the Victorian government suggest the remaining 16,000 vehicles will share the remaining $34 million dollars from the initial $46 million targeted at subsidies; that suggests an average of $2125 per vehicle.

“Electric vehicles are the future for transport. We are making sure that more Victorians can buy a zero emissions vehicle as we prepare for this transport revolution,” says Victorian Minister for Public Transport, Ben Carroll.

Through their representative body the Federal Chamber of Automotive Industries, the automotive brands in Australia welcomed news of the EV subsidy while cautioning against an emphasis on zero emissions vehicles.

“We have worked closely with the Victorian government to find a holistic approach to increasing the uptake of electric vehicles through specific investments and climate targets,” FCAI Chief Executive Tony Weber said.

“However, the FCAI has concerns over the ambitious target of 50 percent of new vehicle sales in Victoria being electric vehicles by 2030, warning that governments should focus on CO2 emissions targets rather than mandating specific technologies.”

UPDATE: An earlier version of this story reported the EV subsidy applied to vehicles priced below $69,000. This information came from a government press release but was later amended to $68,740.