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Why You Could be about to Pay More to Use that Electric Vehicle

While governments around the world apply their best efforts to increase the uptake of electric vehicles, something different is happening down under that many might come to question.

Over the last week or so, we've had news that the populous states of South Australia, New South Wales and now Victoria will be looking to charge electric vehicle owners a road user charge starting from the middle of next year.

The language might be 'softer', however, there is no other way to paint this - it's a tax. In Victoria, this tax has been set at 2.5 cent/km for electric and other zero-emission vehicles, including hydrogen vehicles, while a 2.0 cent/km charge would apply to plug-in hybrid-electric vehicles.


Making sense of the changes

The move is seemingly at odds with the ACT and Tasmania, both of which have committed to a 100% electric future for each region's government fleet, alongside other incentives. And it begs the question - what exactly are the other governments thinking when it comes to promoting the case for the uptake of electric vehicles?

Understandably, the governments in question are trying to get on the front foot. They sense that as fuel excise proceeds slip from the federal government's reach - as motorists abandon combustion engine vehicles or opt for more fuel efficient models - they will also be left on the outer and staring at a shortfall in funding. 

However, notwithstanding the fact that today's excise significantly covers state road funding needs with capacity and then some, we're looking at a situation where the very merit of transitioning to an electric vehicle might come into question. In a world where other governments are effectively incentivising motorists to give green fuel technologies a 'fair go', the opposite is playing out on our shores. 


Extra charges are as sure a way as any to stop the transition to an environmentally friendly solution that the rest of the world has been striving to reach, not to mention, which the inudstry has invested heavily to make a reality. Sure, the well-off motorist eyeing up a six-figure Tesla might not baulk at the price increase associated with the road user charge. However, niche segments of the market only reach critical mass once they have reached mainstream adoption, and that means, 'connecting' with price conscious drivers.

Now, existing vehicles might well be burdened with their own charges in the form of the aforementioned fuel excise. However, for green technology to be given an 'equal' footing in its own right, there needs to be some sort of carrot on offer to naturally reinforce the benefits. Sometimes, this very carrot does mean that not every user will be paying the same cost, or some won't pay anything at all. But if that policy is designed to shift the nation's legacy to a more sustainable outcome, then equity is still at the heart of that process, 

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