Is this the beginning of the end for petrol and diesel cars in Australia? ACT's 2035 internal-combustion ban detailed

Can it really work in Australia? The phase-out of fossil-fuel-powered vehicles? The Australian Capital Territory looks set to find out, with a data-backed ban planned to come into effect by 2035.

The Territory’s Attorney General, Shane Rattenbury, has announced a strategy report in which the ACT will phase out the sale of new internal-combustion passenger vehicles from 2035 in an Australia-first move aimed to match other aggressive phase-out targets already set across Europe.

The strategy targets 80-90 per cent of new light vehicles being zero-emissions by 2030, and includes an extension of the stamp-duty waiver to used electric vehicles (said to save buyers around $1600), a $2000 grant for the installation of EV charging infrastructure in apartment buildings, expanding the ACT charging network to "at least 180 chargers" by 2025, a ban on fossil-fuel powered vehicles on taxi and ride-share fleets by 2030, and 100 per cent of government fleet vehicles to be zero emission vehicles "where fit for purpose".

The government also plans to make all buildings EV-ready and streamline the process for approving chargers on public land. The strategy is more vague about its phase out of existing combustion engined vehicles from 2035, only focusing on the sale of new vehicles, and the phase-out of vehicles from various fleets.

It is unclear how existing combustion vehicles may be treated in 2035, but it is also worth noting that this strategy document is a statement of intent, and not yet law. The ACT government leaves open the adjustment of this strategy closer to 2030.

In terms of price-related incentives for zero emissions buyers, in addition to those outlined above there is also two years of free registration, and the ability to apply for a $15,000 interest-free loan towar the price of an electric car and the installation of charging equipment. Unlike NSW and Victoria, there is no rebate amount being offered to new EV buyers.

Currently, transport accounts for around 60 per cent of the ACT’s emissions footprint, 70 per cent of which is said to be from private vehicles alone. The territory already committed to net zero emissions by 2045.

“The ACT is far from alone on the global stage,” Mr Rattenbury said. “The UK has already committed to phase out internal-combustion-engine cars by 2030 and Europe recently committed to a phase out by 2035.”

Mr Rattenbury also stated the plan would be beneficial to ACT residents who would have “cheaper to run cars” with “cleaner, quieter streets, and less reliance on foreign oil.”

Australia currently imports more than 90 per cent of its fuel, primarily from Singapore, but also from South Korea and China.

The sourcing of Australian fuel has been the source of headlines for more than one reason recently, with skyrocketing prices and the revelation that currently held fuel stocks would only last about a month if supply was disrupted, raising concerns about fuel security.

“This move also lays down a marker for the Federal Government to address the crucial issue of supply. The demand for electric vehicles is clear and the Albanese Government must act to unlock supply by introducing a strong Fuel Efficiency Standard, which would heavily incentivise supply of clean cars, and put Australia on the superhighway to clean transport,” Mr Rattenbury said.

Unlike many other developed nations, Australia’s fuel standards are notoriously lax, allowing for high-sulphur fuels to be used at bowsers. This complaint has been echoed by many vehicle manufacturers who raise issue with the fact that new-generation combustion engines with petrol particulate filters may not be compatible with the poor-quality fuel used Down Under.

Electric vehicles are facing an uphill battle in Australia, with geography and prices working against them. In 2021, just below two per cent of new vehicle sales in Australia were electric, compared to a global average of 10.3 per cent (a number which more than doubled since 2020).