An Australian bank will stop approving personal loans for new petrol and diesel-powered cars from 2025 as the federal government flags tough new fuel efficiency standards. Electric vehicles this year have a minuscule 1.6 per cent market share even when Tesla sales were included, with starting prices of $47,000 and a lack of charging stations turning off many potential motorists. But the customer-owned Bank Australia wants to change that, in a bid to reduce carbon emissions linked to climate change. Its chief impact officer Sasha Courville told the National Electric Vehicle Summit in Canberra on Friday the bank’s new policy was ‘an important step in decarbonising the Australian economy’. ‘By ceasing car loans for new fossil fuel vehicles, we are sending a signal to the Australian market about the rapid acceleration in the transition from internal combustion to electric vehicles we expect to see in the next few years,’ she said.
‘We’ve chosen 2025 because the change to electric vehicles needs to happen quickly, and we believe it can with the right supporting policies in place to bring a greater range of more affordable electric vehicles to Australia.’
Australia’s new electrical vehicle plan
CHARGING STATIONS: Average interval of 150km as part of a plan for a national network
COMMONWEALTH GOVERNMENT CAR FLEET: Low emissions target to apply to 75 per cent of purchased or leased vehicles by 2025
HYDROGEN HIGHWAYS: Refuelling network for another renewable energy-powered vehicle
Bank Australia made the announcement as Climate Change and Energy Minister Chris Bowen and Transport Minister Catherine King jointly announced that new fuel efficiency standards would be introduced as part of a National Electric Vehicle Strategy.
‘Apart from Russia, Australia is the only OECD country to not have, or be in the process of developing, fuel efficiency standards,’ their joint media release said.
Under Labor’s plan, a low emissions target would apply to 75 per cent of the Commonwealth government’s car fleet by 2025, with that figure including purchases and leases.
‘Up until now, Australian households and businesses have had very little choice regarding low-emissions and fuel-efficient vehicles, and they have been paying for it,’ Mr Bowen said.
The ministers have also promised to have electric vehicle charging stations at average intervals of every 150km on major roads along with a national hydrogen highways refueling network.
Ms Courville said Bank Australia would continue allowing loans for secondhand petrol and diesel cars from 2025, as it banned financing for new fossil fuel-powered vehicles.
Federal Chamber of Automotive Industries chief executive Tony Weber described the government’s polices as ‘a major step on our journey to delivering low emission vehicles to Australian customers’.
‘This is a good day,’ he said.
Australia has a net zero by 2050 target with Prime Minister Anthony Albanese’s Labor government this month securing from the Greens support to legislate a 43 per cent reduction in carbon emissions by 2030. Bank Australia has a net zero by 2035 target.
April 2022: At World Bank Climate Talk, Nicholas Stern Floats End of Conventional Vehicles Sales: Urges ‘clarity on timescales for stopping the sale of internal combustion engine vehicles’ – Nicholas Stern, former chief economist for the World Bank from 2000 through 2003: “The right kind of policies have to be put in place, including the abolition of fossil fuel subsidies, the advancement of carbon pricing, but clarity on timescales for decentralization of the grid, clarity on timescales for stopping the sale of internal combustion engine vehicles, and so on—making sure the sense of direction is clear in those ways.”