Fuel Efficiency Standard—Cleaner and Cheaper-to-run Cars for Australia

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In April 2023, the Australian Government sought feedback from the community on the design of a fuel efficiency (CO2) standard, that will reduce greenhouse gas emissions, save Australians money on fuel and see cleaner cars on the road. It aims to achieve this by providing global vehicle manufacturers with the right incentives to send cleaner, greener vehicles to Australia.

Why we want your input

Your input will inform the development of a fuel efficiency standard that provides global vehicle manufacturers with the right incentives to send cleaner, greener vehicles to Australia.

How you can voice your opinion

We are listening to the Australian Community

In April and May 2023, we received around 2700 submissions on the design of an Australian Fuel Efficiency Standard. Further consultation will be undertaken and a Fuel Efficiency Standard will require new legislation.

What will be the outcome of this consultation?

Your submission will inform the Government's approach to an Australian fuel efficiency standard and support our achievement of net zero emissions by 2050.

The Issue

Introducing an Australian fuel efficiency standard can increase the supply of low and zero emissions vehicles in Australia to reduce emissions, reduce fuel costs, and achieve our net zero target.

The transport sector makes up 19% of Australia's emissions, and is projected to be the largest source of emissions by 2030. On average, passenger cars in Australia emit 40% more carbon than cars in the European Union, 20% more than the US and 15% more than New Zealand.

Australia is one of the last industrialised countries to develop a fuel efficiency standard. Australians are getting left behind as the world moves to cleaner cars and are paying more at the bowser as a result. Over 85% of cars sold worldwide are covered by a fuel efficiency standard including in the United States, the European Union, New Zealand, China, India and many more.

The response to the National Electric Vehicle Strategy consultation was clear, without a fuel efficiency standard, there is no requirement for global vehicle manufacturers to send their best fuel saving technology to Australia, including high efficiency internal combustion engine technology, hybrids and electric vehicles (EVs). The lack of proper incentives also means that the plug-in hybrids and EVs supplied to Australia can also be more expensive. As a result, fewer low emissions vehicles flow to the used car market where around 70% of Australians purchase their vehicles.

A fuel efficiency standard in Australia will lower emissions and improve consumer choice, and Australians will still be able to access the vehicles they need, from hatches to 4-wheel drives, utes to vans. A fuel efficiency standard will increase consumer choice of more efficient petrol and diesel engines, hybrids, and more affordable plug-in hybrids and battery EV options.

We set out key design questions in the consultation paper and are working with stakeholders to design a strong standard that is right for Australia. We sought the views of all interested Australians, including the vehicle industry, climate groups, consumers, think tanks, unions, regional Australians and individuals.

Relevant documentation

Outcome

As part of our consultation process, individuals and organisations who lodge a submission are asked to nominate whether they would like their submission to be published by the department, or if they would like to keep their submission private. Where a submission did not indicate a privacy preference, the highest privacy setting has automatically been applied to protect the privacy of the individual. Because of these privacy settings and individual preferences, not all submissions have been published.

Where public submissions have been provided as a document, they have been published as a document.
Where a public submission contains multiple community submissions in one document, that has been published as one document.
Where public submissions have been provided as text in the body of an email, they have been consolidated for ease of community reference into one document.