Electric vehicle road fee would hit outer suburbs hardest, and could throttle record adoption

A proposed road-user charge for electric vehicle (EV) drivers in Australia could significantly hinder the current surge in EV sales, according to a recent study. The research highlights that nearly one in three households might reconsider purchasing an electric vehicle if subjected to an annual fee based on kilometres driven. This potential policy change threatens to stall the momentum of record-breaking EV adoption, which has been fuelled by rising petrol and diesel prices. The study, conducted by University of Sydney honorary professor Simon Jackman and commissioned by the Electric Vehicle Council, surveyed over 3,600 drivers to assess the impact of removing incentives and introducing a road-user charge. Under the NSW government’s proposal of three cents per kilometre, most households would face charges between $300 and $500 annually, with an average cost of $353. The findings reveal that working families in outer suburban areas, particularly blue-collar communities and drivers aged between 33 and 55, would be disproportionately affected by the fee. Professor Jackman noted that while many participants accepted the principle that EV drivers should contribute to road maintenance, there was widespread concern about the timing and scale of the proposed charge. He warned that the fee could deter price-sensitive buyers, especially those on the margins of considering an EV purchase, thus slowing down the transition to electric vehicles. The research suggests that the revenue generated from such a charge would be modest, yet its impact on adoption rates could be significant. Government officials, including Treasurer Jim Chalmers, have indicated openness to introducing a road-user charge to ensure fairness across vehicle types, with NSW planning to implement the scheme by 2027. However, some EV users, such as NSW energy worker Jim Purcival, emphasise the financial benefits of electric vehicles, particularly in fuel savings. Purcival, who commutes 140 kilometres daily, highlighted that charging his EV using solar power has made a substantial difference to his running costs, underscoring the appeal of EVs beyond just environmental factors. The introduction of a road-user charge raises important questions about balancing equitable road funding with maintaining the incentives that have driven EV uptake. Policymakers will need to carefully consider how such fees might affect different demographic groups and the broader goal of accelerating the shift to cleaner transport. The study’s findings suggest that without careful calibration, road-user charges could inadvertently slow progress towards Australia’s electric vehicle future.