Australia, Industrial Relations, Transport Industry News

NatRoad warns of ‘significant financial barrier’ to net zero

NatRoad

NatRoad believes that the continued move to zero emissions in the transport sector will take a toll on smaller businesses, calling on the federal government to establish $3.5 billion fund to help assist the electric transition.

Despite contributing roughly 20 per cent of national carbon emissions, NatRoad says the road transport industry has been “largely forgotten” in the nation’s decarbonisation planning, leading to the detriment of the nation’s plans to reach net zero by 2030.

NatRoad CEO Warren Clark says the association’s submission to a federal House of Representatives inquiry into the transition to EVs says the cost of an electric heavy vehicle is likely to be “two to three times” that of a diesel vehicle.

“This represents a significant financial barrier to the average trucking business,” Clark says.

“Trucking industry revenue is being squeezed by higher costs, with profit margins declining over the past five years to be just 2.3 per cent, while overall industry profit is down by 7.4 per cent.

“We’re pro-decarbonisation as a sector, but we’re also realistic about the day-to-day running costs of heavy vehicles, especially during a cost of living crisis. While alternative fuels and energy, including electric vehicles, have massive emission reduction potential, they currently come at a high-cost premium.

“The bottom line is that by combining the electric heavy vehicle cost barrier with a limited industry ability to pay, there’s likely to be a delay in our sector’s transition to lower emissions.”

NatRoad’s Decarbonisation Industry White Paper is asking the federal government to establish a $3.5 billion Clean Transport Fund, constituting of both loans and direct incentives, to bring forward the road freight transition.

Clark says experiences in the US and Europe have demonstrated that financial incentives are critical to facilitating the early adoption of EVs and alternative fuels for heavy vehicles.

“Make no mistake – moving to EVs where they are suitable for the freight task will bring down operating costs, that’s why we support decarbonisation,” Clark says.

“But the federal government also needs to deliver a strategy and funding for developing low emission truck recharging and refuelling infrastructure.”

NatRoad has also recommended that the Australian federal, state and territory governments should develop a national approach to higher axle mass limits for electric and low emission vehicles.

“While we welcome recent changes to get electric trucks onto the road, the growing inconsistency between the states and territories is just creating another barrier to reducing emissions,” Clark says.

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