About

The Government wants to reduce car emissions: here’s how.

Share
The Federal Government would encourage car companies to sell more low-emissions vehicles under a fuel efficiency standard.
Car emissions is the focus of the Government's new scheme

New cars will have to meet stricter fuel emissions criteria under a government plan to bring cleaner vehicles into the country.

The ‘Fuel Efficiency Standard’ will determine which new car models can be sold in Australia, based on how much petrol they use per kilometre.

The Government hopes the measures will boost supplies of electric, hybrid and fuel-efficient vehicles.

If the standards pass Parliament, Labor will introduce legislation in 2025 and won’t impact existing cars. Here’s what you need to know.

Fuel efficiency

Petrol cars release greenhouse gases and air polluting emissions, which contribute to global warming and reduce air quality.

A vehicle’s fuel efficiency is measured by tracking how much petrol it uses per kilometre, influencing how much carbon dioxide (CO₂) it emits.

In 2022, transport accounted for about a fifth of Australia’s total emissions.

Under the government’s proposal, car models would need to meet an average CO₂ target before manufacturers can sell their vehicles in Australia.

New standard

The standard is designed to encourage car companies to sell more low- and zero-emissions vehicles, like hybrid or electric cars.

Companies found selling new high polluting cars to Australian drivers will face financial penalties.

The government hopes the fuel efficiency standard will result in fewer cars on the road using a lot of petrol.

Major economies including China, the U.S., and Europe have already rolled out fuel efficiency standards.

Petrol costs

It’s estimated the average Australian family pays $5,000 for petrol per year.

Fuel prices have increased significantly in Australia in recent years, partly caused by Russia’s invasion of Ukraine, which reduced global fuel supplies.

The government also said a fuel efficiency standard would make driving cheaper for Australians. It cited modelling showing drivers could save $1,000 per year by 2028.

Emissions

The average Australian family pays $5,000 for petrol per year, according to Government estimates.

Fuel prices have increased significantly in Australia in recent years, partly caused by Russia’s invasion of Ukraine, which reduced global fuel supplies.

The government said a fuel efficiency standard would make driving cheaper for Australians. It cited modelling showing drivers could save $1,000 per year by 2028.

Opposition

Shadow Climate Minister Ted O’Brien urged the government to release its modelling for the proposal.

He also raised concerns over the standard’s potential to minimise choice for drivers.

The Government has said there is “no evidence” suggesting an efficiency standard will increase vehicle prices.

Independent Senator David Pocock welcomed the measures but said there’s “a lot of catching up to do”.

“The absence of fuel efficiency standards have made us the world’s dumping ground for the most fuel inefficient vehicles,” he said.

The government will spend the next month reviewing its proposal before introducing legislation.

It has flagged it wants the policy to come into effect by 1 January 2025, however Pocock is pushing for a July 2024 start date.

Become smarter in three minutes

Get the daily email that makes reading the news actually enjoyable. Stay informed, for free.

Be the smart friend in your group chat

Join thousands of young Aussies and get our 5 min daily newsletter on what matters in your world.

It’s easy. It’s trustworthy. It’s free.