This is the perfect time to announce a future ban on sales of fossil fuel cars, argues former National Party cabinet minister Wayne Mapp.
Now that we have got past the CGT shemozzle, we can get back to the serious policy that the prime minister says is the existential crisis of our times, climate change. To which I would add, the environment generally.
There has been a whole host of official reports setting out the crisis we are in. The dramatic reduction in biodiversity, the reduction in water quality, options to deal with climate change or more specifically emissions of carbon dioxide and methane. Another committee and another report won’t solve these problems.
At least the Climate Change (Zero Carbon) Bill introduced yesterday has actual goals with intermediate steps. The goal is for New Zealand to be carbon neutral by 2050. For farming, biogenic gases need to be 10% below 2017 levels by 2030, and between 24 and 47% less by 2050.
Action by farmers does not engage all of us. It is easy to say climate change is the other person’s fault. So what could be done where we would all have to make positive steps to make a difference?
The most obvious area is transport, which is responsible for 37% of all New Zealand carbon emissions.
Phil Twyford is in charge as minister. His record as a minister to date does not encourage. Julie Anne Genter seems well intentioned, but the power in this area lies with the Green leader James Shaw, who is the climate change minister. Since this is an existential crisis, however, we really need the prime minister to lead the charge. She should be telling us the things that will be done to make a real difference.
We already know that the government will not be building any more motorways, irrespective of the safety issues and in some cases, the fuel savings. The passion is for rail. But where are the actual commitments for rail to Marsden Point and the electrification of the main trunk line?
At least the Hamilton to Auckland passenger rail is getting under way, opening in March 2020. It will be a diesel train from Hamilton to Papakura, then a change of train to the electric commuter to Auckland. Total time of two hours 29 minutes, with stops at Huntly and Rotokauri. Not as fast as the motorway. Clearly more needs to be done – in particular full electrification from Hamilton to Auckland so that a fast train service can be established. That is, fast for New Zealand: say 160 kph max speed, with the aim of a 90 minute service, Auckland to Hamilton.
But the great majority of people will not be using the train, or for that matter, light rail trams.
For most New Zealanders, the car is still dominant. There are 3.9 million motor vehicles in New Zealand. The great majority are cars and SUVs. They generate the bulk of the transport sector’s 37% of New Zealand carbon emissions. Changing the vehicle fleet is imperative to make any real impact on New Zealand’s emissions.
Norway is banning the sale of new fossil fuelled cars from 2025. France is doing the same from 2040, and the UK is doing so by 2050. All these countries have far newer vehicle fleets than New Zealand. Norway could have a completely zero emission vehicle fleet by 2035.
So far New Zealand has no specific plan to change the entire vehicle fleet. We are not nearly as rich as Norway, so a change by 2025 looks unrealistic. But what about 2030?
Once that signal is given, many people will change sooner. Cars basically fully depreciate in ten years. Obviously, they last longer. But a $40,000 car has a market value of around $5,000 after 10 years, so 2030 works as an economic signal.
The New Zealand vehicle fleet has an average age of 10 years, so it will take 20 years to change the whole fleet. Quite a bit of that change will occur before 2030, as new car buyers change their purchase patterns. Each year there are about 190,000 new registrations, so the impact of the change will soon show up.
The big issue is low income families. Maybe half of all car buyers are purchasing second hand Japanese cars for less than $10,000. There is no way they can afford a new electric car. A new electric Hyundai Kona SUV costs $73,000 right now; the price could be around $50,000 for a new model in a few years.
So how do we help lower income families make the shift? It will require a decent subsidy, maybe $5,000 per year for five years of car ownership or annual lease. Not only will this help emissions, it will mean much safer cars for low income families. Many of the terrible recent accidents have many more deaths and injuries in older, less safe vehicles.
Probably 100,000 of the new annual registrations would attract such a subsidy, targeted at lower income families. The initial annual cost would be $500 million, assuming full take up, rising to $2.5 billion per year in five years. It is a large sum of money, but it is doable. Governments have previously had tax packages or family support packages of this size.
In this case such a policy would be a key policy in bringing down emissions. It would totally eliminate all transport emissions by 2040, so would be a huge step toward a zero emission economy.
The UK parliament has just declared a climate change emergency. Such declarations mean nothing without action. If the government announced next year that they were banning the import of fossil fueled cars by 2030, along with a package to help income families be part of the shift to electric vehicles, that would be a serious step.
New Zealand transport could actually be carbon neutral by 2040. But that will only happen if serious action happens now.
The Bulletin is The Spinoff’s acclaimed daily digest of New Zealand’s most important stories, delivered directly to your inbox each morning.