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FEDERAL CHAMBER OF AUTOMOTIVE INDUSTRIES. Tm Reardon: Director Government Policy Global Fuel Economy Initiative 2 March 2011. Bad Data = Bad Policy. Good Data = Good Policy. Source: SAPERE Research Group . Flawed International Comparisons. International Comparisons. 2009 CO2 Outcomes:
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FEDERAL CHAMBER OF AUTOMOTIVE INDUSTRIES Tm Reardon: Director Government Policy Global Fuel Economy Initiative 2 March 2011
Good Data = Good Policy Source: SAPERE Research Group
International Comparisons • 2009 CO2 Outcomes: • UK= 149 Grams of CO2/km • Australia 219 Grams of CO2/km • Adjusted for: • Market Segment: 199 Grams CO2 • Fuel Type: 175 Grams of CO2 • Vehicle Size: 156 Grams of CO2 • Other factors: • Auto Transmissions • Fuel Quality
Australian Policy Framework • 24 July 2010, Election Commitment: • Mandatory CO2 Target. • 27 January 2011, PM announced: • Abolition of the CCR. • Capping of the LPG Vehicle Scheme. • Abolition of the GCIF. • 24 February 2011, PM announced: • A carbon price from 1 July 2012. • Transportation fuels incorporated.
Motor Vehicle CO2 Emissions: Policy Elements Congestion Pricing Carbon Price (ETS, Carbon tax) Vehicle CO2 Emissions Standard Reducing CO2 Emissions from Motor Vehicles Fuel Excise Green Car Innovation Fund Luxury Car Tax Fringe Benefits Tax
Belt or Braces • Carbon Price Vs Carbon Standard: • A carbon price can efficiently determine the least cost method of emissions abatement. • Secondary emission strategies, such as Mandatory Standards, assume that a reduction of one tonne of C02 from a passenger motor vehicle is more important than a reduction of one tonne of C02 from any other sector of the economy.
New Vehicle Fuel Efficiency History of PMV CO2 Emissions Forecast CO2 Emissions CO2 Price and/or CO2 Standard Design Options for a Standard Taxation Issues
NAFC/NACE Targets 1983 = 9.5 Litres/100km 1990 = 9.0 Litres/100km 2000 = 8.2 Litres/100km 20?? = 6.8 Litres/100km 2010 = 222 Grams of CO2
National Average Fuel Consumption 2010 Target • 2010 Target = 222 grams of CO2 • All Fuel Types. • All vehicles under 3.5 tonne. • 2010 outcome = 212.6 grams of CO2.
Change in NACE: Segment Change Vs Vehicle Technology (including Fuel)
Target Achieved, What Next? • July 2010: • Mandatory NACE Target • 2015 = 190 grams of CO2 • 2024 = 155 grams of CO2
Technology improvements: • Lightweighting • Aerodynamics • Reduced mechanical friction • Low friction tyres • Weight gains • Safety • Emissions • Noise • Quality • Comfort Efficiency Gains v Mass Increases
CO2 Targets: Economy Wide Targets • Australian Government target of 5% to 25% reduction in CO2 emissions by 2020 based on 2000 levels. • 2000 = 260 g/CO2 • 25% reduction • 2020 = 195 g/CO2
Flexibilities • Credits for: • Low emission vehicles • Eco-technologies • Alternative fuels • Phase-In from 2015 • Averaging and Pooling • Make Good Provision (Banking/Borrowing)
Options for Burden Sharing • Industry Target. • Vehicle based approach: Standard set which vehicle must achieve in order to enter the Australian market. • Corporate Average: Each brand provided a target CACE: • All brands to achieve 195 grams. • Uniform Percentage Reduction. • Parameter based target.
Reducing CO2 emissions – – integrated approach An integrated approach Delivering majority of new car CO2 reductions Influencing demand in a harmonised way Sustainable production Reducing congestion
CO2 Standard : Summary • Developed Co-operatively with Industry. • Based on reliable data. • Recognition of Non-test cycle technologies: • Alternative Fuels. • GSI, TPM, Air-con gases, Etc. • Incentives for emerging technologies. • Realistic target consistent with economy wide objectives.
FEDERAL CHAMBER OF AUTOMOTIVE INDUSTRIES Global Fuel Economy Initiative 2 March 2011