The Government has announced the next steps on replacing petrol tax with electronic Road User Charges (RUCs) for all vehicles—a shift that has the potential to be transformational for Aotearoa. Drive Electric is cautiously optimistic.
Currently, RUCs are paid on a per-kilometre basis by diesel vehicle and EV owners to fund road usage, while other vehicle owners pay Fuel Excise Duty (FED) at the pump.
Funding the maintenance and development of our roading system is important, especially for regional areas. However, metropolitan centres require an integrated transport approach, rather than a road-focused one, to improve transport efficiency. On a broader scale, the Government should ensure that RUCs for all are implemented as part of a strategic pathway toward a more affordable, low-emissions future.
The Government’s most recent RUC changes have further slowed EV adoption at a time when sales were already stalling due to the removal of the Clean Car Discount (CCD). It is critical that the Government focuses on delivering wins for both the economy and the climate when introducing RUCs for all.
There are challenges ahead for the Government. Petrol will become much cheaper with the removal of FED, which risks shifting focus away from the adoption of fuel-efficient vehicles. Less fuel-efficient vehicles tend to be more polluting. Additionally, petrol and diesel vehicles rely on imported fossil fuels, whereas EVs in Aotearoa are powered by renewable, locally generated electricity.
The financial burden of air pollution is well documented. Aotearoa’s trade deficit with Singapore and South Korea, our main providers of refined fuel, has ballooned following the closure of the Marsden Point refinery.
A shift to electric transport will provide cleaner air, cheaper travel, greater fuel security, and support our balance of trade. The Government must seize this opportunity and be clear in its objectives. It has a once-in-a-decade chance to put Aotearoa’s transport system back on the path to a cleaner, emissions-free future.
Further Reading:
Where does our fuel come from? (Infometrics)
Wood smoke, traffic fumes polluting Christchurch’s air (RNZ News)
Our air 2024 (Ministry for the Environment)
Transport (Ministry for the Environment)
