The Australian government says the New Vehicle Efficiency Standard (NVES) has given Australians more choice in electric vehicles (EVs) – and contributed to an overall reduction in greenhouse gases of 1.9 per cent over the last 12 months.
Talk about the ABC AM Chris Bowen – the minister for climate change and energy – said on the radio program that the 8.5 million tonnes reduction in Australia’s emissions by the end of September 2025 was among the “encouraging figures”.
The fall caused by the transport sector, at 0.4 per cent, was not as large as the overall decline, but Mr Bowen said that sector was particularly difficult to reduce emissions quickly.
“For the first time outside of COVID, we’re also seeing a reduction in our transportation emissions – just a very small… (a) 0.4 percent reduction, but still,” he said ABC Radio.
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“Transportation is a very difficult nut to crack, a sector where it is very difficult to reverse emissions because it is such a long-term sector: if you buy a car today, it will be on the road for an average of 17 years,” the minister added.
“This is the first sign that our policies, (the) New Vehicle Efficiency Standard, are increasing the number of electric vehicles and are starting to have an impact.”
The NVES came into force on January 1, 2025 and sets carbon dioxide tailpipe emissions limits for new vehicle manufacturers.
Under the NVES, each automaker’s emissions are averaged across the entire range of vehicles and those that meet the established limits receive credits that can be sold to those who exceed their limits so that they can avoid financial penalties, which came into effect on July 1, 2025.
The first report was published in February 2026 and showed only 19 of around 70 Australian manufacturers exceeded the limits, with those violating them potentially facing penalties.
The report also showed that average emissions from new light passenger vehicles exceeded the NVES target, which gets stricter every year until 2029, by 21 percent.
But since 2005, emissions from Australia’s transport sector have increased by 23 per cent – including 11 per cent higher diesel emissions – Mr Bowen highlighted ABCThis is Melissa Clarke.
“As I said at the start, it is a small reduction,” Mr Bowen admitted.
“I’m not exaggerating, but considering it’s been so hard to let up – and you know, it’s not a bad thing if people are moving around more, and it’s not a bad thing if people are going somewhere – then that’s what we want to see.
“We (also) want the emissions intensity to go down; we want the associated CO2 emissions to go down.”
“We’ve done things that have been too difficult for 20 years, like the New Vehicle Efficiency Standard.
“There has been a massive increase in electric vehicle supply in terms of choice for Australia – cheap models, expensive models, low range, high range – giving Australians much more choice and they are increasingly taking advantage of it.”
Other government initiatives included the Vehicle-to-Grid Network (V2GN), launched by Mr Bowen in December 2025 to encourage PHEV and EV owners to feed electricity back into the national grid.
Earlier this month, state-owned Clean Energy Finance Corporation (CEFC) committed up to $60 million to Hyundai Capital Australia (HCAU) to offer discounted financing for eligible Hyundai and Kia electric vehicles.
The Climate Change Authority’s 2035 Targets Advice, announced in September, calls for a 62 to 70 percent reduction in carbon dioxide emissions from 2005 levels over the next decade.
For the first time, more than 100,000 electric vehicles were sold in Australia in 2025 – a new record – with an increase of 13.1 percent year-on-year and a record market share of 8.3 percent.
That number was overshadowed by nearly 200,000 sales of non-plug-in hybrid vehicles.
“Consumers are not yet buying electric vehicles at the levels expected, nor at the levels needed to meet emissions targets,” said Tony Weber, CEO of the Federal Chamber of Automotive Industries.
“The key to driving the uptake of electric vehicles is to ensure adequate charging infrastructure is in place, the total cost of ownership is reduced and that electric vehicles meet the needs and wants of Australian motorists.
“Ensuring the availability of charging infrastructure is essential if the NVES is to make a difference in achieving climate goals.”
The Climate Change and Energy Minister said the work was far from complete as he rounded up his work ABC Radio interview.
“(There is) a lot more to do when it comes to charging infrastructure and securing that support,” Mr Bowen said.
“We have tripled the number of available charging stations, we have massively increased the number of electric vehicles, but this is an ongoing task that we want to take on.”
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