NSW Government pledges $105m to offset EV fleet costs

EV fleet incentives NSW Government
EV fleet incentives NSW Government

22 November 2021: The NSW Government has announced new incentives totalling $105 million to encourage businesses, not-for-profits, hire companies and local councils with more than 10 vehicles to convert their fleet to certain types of electric vehicles (EVs).

Supplementing a $490 million commitment detailed in the government's 2021 budget to assist NSW’s transition to EVs, the fleet incentives will extend rebates and exemptions on battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEV) to reduce the price gap between them and comparable internal combustion engine models.

The incentives will be available for BEV and FCEV passenger vehicles and SUVs with a recommended retail price of less than $100,000 inclusive of GST. Light commercial vehicles such as utes and vans are also included without a price cap. More information on eligibility can be found in the Drive Electric NSW EV fleets incentive report.

Run in a ‘reverse bidding’ style, fleet operators can request support based on the level of incentive needed to procure eligible EVs.

Fleet vehicles currently make up roughly half of new-car sales in Australia and generally have a short tenure, meaning increased EV volume in fleets now will result in more affordable, pre-owned examples on the used market in coming years.

Treasurer and Minister for Energy and Environment Matt Kean says the segment is crucial to NSW reaching the targets set out in its Electric Vehicle Strategy and making EVs more commonplace on our roads:

“NSW is on track to have EVs make up more than half of new cars on the road by 2030 ... Fleet buyers make up about 50 per cent of new vehicle sales and usually sell them after three to four years, creating a great opportunity for us to increase the second hand EV market for the whole community,” Mr Kean said.

The savings will continue after the vehicle has been procured, the government claims, with operators saving up to $3100 on annual running costs (compared to ICE vehicles) and reducing their CO2 emissions by roughly five tonnes per vehicle on average.

“Whether you’re a hire car operator, in the delivery business or own a construction company, these new fleet incentives will make it easier for your business to transition to EVs while enjoying the benefits of reduced costs and emissions,” Mr Kean said.

How can businesses apply for EV fleet incentives?

Updated December 2021: Detailed in a virtual information session held on 30 November 2021, the selection process for businesses applying for EV fleet incentives will be conducted in four stages.

Stage 1: From 7 December 2021, business are able to select the number and type of BEVs and FCEVs they are looking to procure through the government’s bidding platform. The platform also allows businesses to perform total cost of ownership calculations as well as emission differences between the electric models and ICE counterparts.

When amounts are calculated, businesses are able to request funding per vehicle, with $/tonnes of CO2 saved calculated, forming a final bid and used to rank the application against other businesses’.

Stage 2: Between 13 December 2021 and 4 February 2022, businesses are asked to: formalise their bid with evidence of their annual driving distance; support changes made to pre-set values of the TCO calculation, and; confirm if the vehicles will be charged with renewable energy.

Stage 3: Businesses will be provided with their current ranking compared to the most competitive bidder in their stream by 18 February 2022. From here, business have one week to confirm or update their final bid.

Stage 4: The NSW Government will contact successful bidders between March and April 2022. Funding will be provided when a vehicle is purchased and registered with adequate evidence supplied by the business.

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