Government Subsidies for Electric Vehicles

Rob Bell

Issue 23, June 2019

There has been a renewed interest in Electric Vehicles worldwide, and specifically in Australia, but what about all the existing cars?

Just recently, we’ve seen news reports about politicians wanting to increase the number of Electric Vehicles on our roads. As a country, Australia has been largely late to the party. Perhaps, it’s just that we’re fashionably late, and we’ll soon become the life of the party?!


For those of you residing in Australia, you’ll likely be familiar with government initiatives in recent years. However, if you’re not, here’s a quick primer:

LPG CONVERSIONS: In 2006, a $2000 (AUD) subsidy was introduced to help people convert their vehicles to LPG. This was designed to help reduce emissions, running costs, and more.

HOME SOLAR: While this one is something of a political football, we’ve had generous feed-in tariffs (albeit lessened now), rebates on installation costs, and various loan schemes to help people gain access.

HOME INSULATION: Making our homes more energy efficient thanks to insulation installation rebates, reduced heating and cooling costs, in turn, means a reduction in emissions.

WATER TANKS: Many local councils tackled drought conditions across our country, not with just water restrictions, but incentives for installing rainwater tanks too.

All of these programmes have had their successes and failures, but at least they were moving in the right direction.


As with any of these programmes, we unfortunately see inexperienced companies pop up out of nowhere to take advantage of the schemes. Sometimes with a few “cowboys” too with terrible intentions. But let’s face it, that happens in any industry, regardless of how it comes about.

Converting vehicles to E.V. is not really new. It’s been around for decades, but it’s always been seen as something of a rogue or DIY approach. What if the industry was encouraged to change that perception?

If we developed standards and guidance around the approach to conversions, it could easily become as ubiquitous as having your car serviced.


Well, naturally, there’s not just one answer. But what if it’s PART of the answer?

Let’s consider the numbers. There are almost 20-million vehicles on Australian roads. That’s a huge number for a country with just a few million more people than that. Every year, just over 1-million new cars are sold in this country. That means around 5% of the cars on the road are new - just 5%! Instead of aiming to sell 10% of new cars as E.V., why not try and convert 10% of existing cars each year?

After all, virtually all major manufacturers are now on the bandwagon for electric and hybrid vehicles, and within a few years, we’ll likely have no other choice. Fortunately, they won’t look like a Prius (apologies to all those out there who love their Prius).

However, even in 5-years, it would still leave 15-million cars with ageing Internal Combustion Engines in them.


If we consider the overall carbon footprint of a vehicle conversion versus a new one, there must be some generous benefits for a conversion.

Someone with better number skills than I, in addition to the appropriate data, could no-doubt work out these numbers and make a substantial business case to do it.

Arguably, these vehicles can have their anticipated lifespans drastically increased by replacing the motor with fresh new E.V. equipment.

Ultimately this disregards various other improvements which come with a new vehicle, such as increased safety features, which are indeed an important consideration.

There’s also the more vain aspects such as all the shiny things, better Sat-nav, and that unbeatable new car smell... but I’m sure many of us can move past those things; especially if financially incentivised to do so.


Ultimately there are also other challenges with converting millions of vehicles from fuel to electric. Our electricity infrastructures struggle under Summer loads with air conditioners keeping us cool already. Imagine if we added a few million vehicles to that infrastructure?

Sure, if we’re all recharging from our home batteries which were cleanly recharged from the Sun’s rays that previous day, then this isn’t much of a concern. However, that’s also something that would take time.

We’ve reached a huge milestone in Australia, with over two-million households using rooftop solar. This marks a huge number, however, only a fraction of these have some form of battery storage. Those numbers, I’m confident, will continue to grow.


It seems entirely feasible to create an industry within this field, professionally retrofitting vehicles with electric technology.

Send the cast iron engines to the metal recyclers to turn them into new metal products. Give a proportion of these 20-million vehicles a new, greener lease on life.